Lifetime achievement for Fastway founder

Lifetime achievement

for Fastway founder

AUCKLAND: Fastway Couriers mobile franchise founder and chairman, Bill McGowan, (pictured right above with Mike Henderson) has been recognised for his contribution to the New Zealand franchise industry with a Lifetime Achievement award from the Franchise Association of New Zealand (FANZ). The award is one of only two the association has given since its establishment in 1996.

McGowan was presented with the award at a recent FANZ event in Auckland by FANZ board chairman Mike Henderson.

“With this award we are acknowledging Bill’s 20-plus years in franchising, but also his pioneering vision. He has contributed greatly not only to the New Zealand franchising industry, but has also shown how it can be done if you want to export your business,” Henderson said.

Fastway business services franchise – which operates in 12 countries globally – is one of the few New Zealand franchise systems to be successfully exported overseas.

“More than 75 percent of the franchise businesses in New Zealand were developed here, and as franchise systems reach saturation point in this country more and more will need to be looking at overseas markets for expansion and growth,” Henderson said. “If it were me, the person I would be seeking advice from is Bill McGowan.”

McGowan founded Fastway Couriers 23 years ago with a single courier van. It is now arguably the most successful locally grown NZ franchise to expand offshore. With annual sales of NZ$258 million it is the largest global courier franchise in the world, operating more than 1,200 franchises globally.

Bartercard teams with Austrade

SYDNEY: Bartercard, the world’s largest trade exchange, has forged a relationship with the Australian Trade Commission (Austrade) which, it claims, will further help make exporting to Britain a real possibility for SMEs.

“Exporting is often difficult because of cost and language barriers, but the fact that Australians and Britons both speak English simplifies the process. Acute cultural differences, however, mean that trading between the countries is typically problematic,” says Bartercard International executive chairman, Wayne Sharpe. “Teaming up with Austrade has allowed Bartercard to access thriving SMEs in Australia which are looking to expand their businesses abroad.

“In return, as these businesses become Bartercard members, they will have access to a database of more than 4,000 UK businesses with which they will be able to trade. In addition, they will be able to enjoy all the usual benefits associated with being a Bartercard member.

“Austrade’s raison d’etre is to assist Australian companies to trade successfully with overseas companies by reducing the time, cost and risk involved in selecting and entering new markets. By working with Bartercard, the element of risk is taken away as they will be able to contact thousands of respected businesses in the UK as soon as they join. They will also be able to reduce cash expenses, effectively trade spare capacity or unused goods, thereby increasing their profit margins.”

In another development, Bartercard International managing director, Andrew Federowsky, has been inducted into the International Reciprocal Trade Association (RTA) Hall of Fame. He is the Hall of Fame’s youngest inductee.

Brumby’s in breakthrough

arrangement with the ATO

BRISBANE: Bakery franchise Brumby’s and the Australian Tax Office (ATO) have agreed to trial an arrangement that delivers administrative tax concessions for franchisees and which potentially could set the model for future arrangements with other franchise chains.

The arrangement requires Brumby’s 300 franchisees to meet their existing reporting obligations of weekly shop reports and monthly profit and loss statements as well as lodging and paying their tax on time.

In return the ATO will reduce the period in which people need to keep business records for tax purposes from five to three years; be less likely to conduct intrusive reviews or audits; and provide potential concession treatment in relation to penalties for any tax shortfall amounts where people have made a genuine attempt to comply.

According to Brumby’s managing director, Michael Sherlock, the arrangement recognises businesses with good compliance behaviour and reliable internal controls.

“In return the Tax Office provides them with administrative concessions,” he says.

Brumby’s and the ATO will evaluate the trial in six months to ensure the arrangement is working effectively.

Under the arrangement, Brumby’s will conduct assurance reviews to ensure integrity of the records and reports by franchisees.

“By giving this assurance to the Tax Office that franchisees are observing all their record keeping and reporting obligations, we have achieved significant concessions for our franchisees in meeting their administrative tax obligations,” Sherlock says. “It is a major breakthrough that will hopefully be able to be duplicated beyond Brumby’s.”

In another development, investment group River Capital executive director, Paul Cowan, has joined the Brumby’s board. The move comes after River Capital purchased 258,900 shares in August, which followed an off-market purchase in February of 816,000 and a further purchase of 488,449 shares in April.

River Capital, which holds strategic positions in both Australian and international businesses, is now Brumby’s largest individual shareholder controlling 14.96 percent of Brumby’s shares, up from just 1.7 percent at the beginning of February.

Brumby’s fourth largest individual shareholder, Marcus Barlow, has also joined the Brumby’s board. Cowan and Barlow fill vacancies created by the departure of board members Bob Snow and Tom Brigstocke.

New system aims to

shake up franchising

MELBOURNE: The architects of an accreditation system designed to for the first time provide a clear benchmark for the rapidly growing franchising sector are continuing to ramp up the concept, confirming that the new service will soon be available to franchises of all sizes for approximately $15,000.

The Franchise Industry Quality Accreditation (FIQA) system, which is being developed by ROCG Asia Pacific, Franchise Point and Point Management, has already been endorsed by some of franchising’s most prominent identities as a means to improving and expanding best practice processes in a sector that in Australia alone constitutes 850 franchise systems, 55,000 franchisees and employs 720,000 people.

According to ROCG Asia Pacific director, Nathan Rose, the immediate target after launch is to have five Australian systems per month achieve FIQA status, and then export the model overseas.

With disputes between franchisors and franchisees becoming increasingly high-profile, as exemplified by the recent court case involving Lenard’s and one of its former franchisees, Franchise Point managing director, Michael Anthony, says there is a need for greater transparency among franchisors, and that in providing them with the opportunity to achieve industry best practice FIQA will also help them attract better quality franchisees.

The case for a universal measuring stick in franchising has been argued for many years, but this is the first time such a system been developed.

“It is totally unique and the next step will be for franchisees to be benchmarked. The only way to achieve true best practice and real business improvements is to get franchisors working a lot more closely with their franchisees,” Rose says.

However, he does not believe there is a need for anything as sophisticated as the ISO standards.

“Many franchise systems are relatively small and cannot afford to spend $50,000 to $200,000 on a compliance application. As such, we intend to work around a figure of $15,000, which we think is affordable for most systems,” he says.

Although Rose and Anthony have been the key drivers behind the new system, and Rose is still in the process of fine-tuning the 200-odd questions that will be used to gauge a franchise’s different competencies, neither intend to retain stewardship over its application.

“We see the actual process of FIQA accreditation being handed over to a steering panel that might, for example, involve the Franchise Council of Australia and franchisors themselves. Whether an organisation is finally delivered FIQA status, or administered an FIQA under terms that certain improvements are made within six months, will be controlled by a collective so that the franchise industry itself will affect how it grows within the marketplace,” Anthony says.

What, then, makes for a best-of-breed franchise system?

“It is a combination of the internal structure of the business itself, cultural processes, commercial opportunities and the ability of the franchise to communicate externally to the marketplace,” Anthony explains. “A best practice franchisor will have established the processes that deliver an exciting, learning culture, and a vehicle for the growth and development of franchisees.”

The FIQA will objectively measure these processes and in so doing become an important development tool for franchises to achieve industry best practice.

“We will look at management, at the external business positioning and internally at how it is run from a strategic and operational aspect. We will measure each of these and set a benchmark that companies need to achieve in each area. We will also conduct financial benchmarking, as obviously a franchise needs to be strong financially,” Rose says.

According to Anthony, Franchise Industry Quality Accreditation will become a key method through which quality franchise systems will be able to differentiate themselves in the eyes of potential franchisees and end customers.

“FIQA is designed to up-skill, and in delivering a better system accredited franchisors will attract better quality franchisees,” he says. “Even if they do not initially achieve the benchmarks we will be able to deliver a road map as to what, exactly, they need to implement to eventually receive FIQA.”

As far as the thousands of people currently considering buying a franchise are concerned, formal accreditation seems set to become a case of ‘if not, why not?’

For an in-depth interview with Michael Anthony and Nathan Rose, see page 88 in this issue.

Awards a sign of success

SYDNEY: A series of interpretation panels and vivid backdrops of World War II images produced on acrylic sheets has won a silver award in the ‘Exhibition Stands’ category at the recent Australian Sign and Graphic Association (AGSA) sign awards.

The project took a month to complete and was produced and installed by Signwave in Newtown for a temporary exhibition at the Sydney Jewish Museum.

Signwave Newtown also won a silver award for signage work undertaken for Nestle Australia in the ‘Any Sign Produced/Designed From Out of House’ category. This entry took three months to complete and included signage, murals and displays for five levels of the Nestle Australia building.

According to AGSA business development executive, John Hadfield, Signwave Newtown beat 10 competing finalists in each category to take out the awards.

“Both Signwave Newtown’s entries had the ‘wow’ factor the judges were looking for – impact, design and practicality. They used exceptional design, layout and graphics to portray the desired message for the client in a creative and effective manner,” Hadfield says.

Dean Rowland from Signwave Newtown says the awards are a coup for the centre as they are typically won by large ‘traditional’ sign-writing companies.

“We were up against people who had been in the industry for over 50 years, so we are extremely proud that our efforts have been recognised by AGSA,” he says. “Winning these awards has strengthened our presence in the industry. It has also increased credibility for our business with both existing and future clients.”

Small businesses wary

under current IR laws

SYDNEY: One third of small businesses in Australia may consider not hiring employees due to the current unfair dismissal laws, according to a special focus report on industrial relations reforms from the latest MYOB Australian Small Business Survey.

“This figure would appear to support the Federal Government’s planned industrial relations reforms. However, 41 percent of respondents remain neutral or undecided regarding the effect of dismissal laws on their recruitment decisions, indicating they need more clarity and information around these reforms from the Federal Government,” says MYOB chief executive officer, Craig Winkler.

At the same time, 44 percent of respondents believe the level of government ‘red tape’ and compliance requirements have increased over the past three years. About one in three small businesses believe that reducing red tape at the Federal Government level would benefit their business the most, compared to a reduction at the state or local level.

When asked to rank the areas of red tape that is the greatest burden, 31 percent of respondents ranked BAS reporting first, while 19 percent ranked allocating GST to daily transactions second.

“The frustrations of small business around the burden of red tape has been building for years, so government policy that will make a significant difference to the regulatory load on companies would be welcomed by small business owners,” Winkler says.

The special focus report also questioned small business about super choice legislation following the implementation of the super choice legislation on 1 July. The report found two-thirds of small businesses pay into two or less super funds, with 43 percent paying into only one fund.

“This statistic perhaps explains why 82 percent of respondents did not see super choice as a significant burden to their business, while only 12 percent of small businesses reported that they needed to increase the number of super funds they contribute to as a result of the new legislation,” Winkler says.

The survey also polled business owners about key economic and business indicators and revealed that small business is polarised about their confidence in the Australian economy over the next 12 months. Overall, there has been a shift towards greater optimism and greater pessimism, with 30 percent believing the economy will be ‘better than now’, up eight percent from the previous quarter, yet 36 percent believe the economy will be worse than now, up seven percent. The proportion of small businesses indicating no change has in turn dropped 17 percent to 21 percent.

In the survey’s outlook for specific business issues, interest rates, business costs and government policies continue to be the major concerns of small businesses, although these negative ratings are down.

However, only 21 percent of respondents believed interest rates are having a negative outlook, down from 51 percent in the last quarter, certainly due to the stability around interest rates since the last survey.

A dog gone success

MELBOURNE: Belinda Richards from Sydenham Aussie Pooch Mobile has been awarded International Aussie Pooch Franchisee of the Year at the company’s recent annual conference. She was also a finalist for the third year running in the PricewaterhouseCoopers Excellence in Franchising Awards.

Richards was chosen for her outstanding service to customers and their pets as well as dedication to the Aussie Pooch system as a whole.

“I truly enjoy the interaction with my customers and their dogs. Being greeted by four-legged tail-wagging friends each day is my motivation. The award was unexpected and I am honoured to be recognised in this way,” Richards says.

Richards has been with Aussie Pooch Mobile for four years and has combined her ambition and drive, together with the Aussie Pooch system, to not only achieve a successful business, but be a mentor to other franchisees.

Deacons great honoured

PERTH: Former Deacons partner and now Perth consultant, John Groppoli, has been awarded the Contribution to Franchising award at the recent WA Franchise Council of Australia Awards.

Groppoli is chairman of the national franchise group Termi-mesh and sits on the board of Retravision (WA), the state’s largest electrical retailer and wholesaler. As a consultant to Deacons, he has retained several huge franchisors among his long-term clients.

On receiving the award, Groppoli stated: “I am obviously very proud to have won the award this year. The award represents recognition by your peers of the significant contribution that you have made to the franchising sector. It is always pleasing that your efforts over many years in a particular field of endeavour are ultimately recognised. Credit must also go to Deacons and such people as senior associate Tamra Seaton who has worked with me over recent times and the support that I have had from her in this regard.”

Groppoli was managing partner at Sly & Weigall when its Perth office integrated with the national Deacons partnership in 2001. Recognised for his exceptional leadership skills and expertise in franchising, his other appointments have included Dome Coffees, Franchise Council of Australia and Milner’s, where he is now managing director.

One of Groppoli’s philosophies regarding franchising has been to take a commercial approach and devise strategies that consider industry implications.

New COO for ERA

SYDNEY: Expense Reduction Analysts’ expansion in Australia has led to a new position in the organisation. Avron Newstadt (pictured right, top right, with Stan Zets) has been appointed chief operating officer responsible for day-to-day operations of the franchise network, its marketing and business development. Newstadt will work closely with CEO Stan Zets, who will continue to focus on the strategic development of the Australian headquartered global franchise.

“I look forward to working together with all the franchisees to develop methods of increasing their revenues. This could be through improved marketing of our existing services and/or the development of additional products and services that can be offered through our franchisee network to new clients, as well as further developing our existing client base,” Newstadt says.

“Through my experience as a franchisee and time spent in operational finance positions within small to medium-sized organisations as well as two years in a private equity firm, I feel that I can bring an understanding of the opportunities to both new and existing franchisees, an ability to relate to clients’ operational requirements in a business development capacity and a strong network to assist in further business development.”

Launched in the UK in 1992, ERA is represented in over 20 countries worldwide.

HeadzUP for Just Cuts

SYDNEY: Hairdressing franchise Just Cuts has launched a new lifestyle magazine, HeadzUp, with 200,000 copies distributed throughout Australia and New Zealand.

“We are always looking for a way to make a difference to our clients’ lives,” says Just Cuts founder, Denis McFadden. “It’s no ordinary magazine either. In keeping with our vision to make a difference in peoples lives, it will be a stimulating mix of issues-based and uplifting stories.

“Hairdressers are rightly renowned for their relationships with their clients, and the magazine is an extension of that relationship.”

Just Cuts has 150 salons and services more than 60,000 customers a week.

“We share a few tips on how to treat yourself, try a new look, and get help when you need it. It’s more real world than celebrity,” says editor Jess Scully.

The magazine also features advertising promoting the Just Cuts hair product ranges, Justice and Edgy.

New workplace survey

SYDNEY: The NSW Office of Industrial Relations is encouraging employers and employees across the state to talk about their experiences of family-friendly work practices and policies in a new survey.

The Work and Family Survey will gather case study material on flexible working practices and policies to develop practical guidance for both employers and their staff.

“Most employers now recognise the importance of flexible work arrangements, knowing these sorts of policies can help them attract and retain the best staff,” says Pat Manser, Office of Industrial Relations deputy director-general.

“Employees expect more options when it comes to their work arrangements, placing more importance on balancing work and family commitments. Promoting family-friendly practices and policies that work for both employees and employers is a key priority under the state industrial system.

“There’s growing concern that many of the gains won for working families under the state system may be at risk with the federal government’s proposed industrial relations changes. It’s timely, then, to ask business people and their staff about the work practices and policies they have in place, what they find useful and effective and what they want to see retained.”

The Office of Industrial Relations provides direct help to employers on setting up and managing flexible arrangements.

“We’re always interested in hearing new ideas and suggestions on what works and what doesn’t, and I invite all employers and employees to fill in the survey and tell us about their experiences,” Manser says.

The survey is located on the OIR’s work and family website at www.workandfamily.nsw.gov.au. For further information call 131 628.

Working underclass revealed

SYDNEY: What do coffee shops, butchers and cabinet makers have in common? According to a new study by CCH Australia, a desperate need to get good financial advice if they are to even meet average returns.

Latest figures from Australian Bureau of Statistics (for the period ended April 2005) reveal average full-time adult, ordinary time earnings of $1006.70 per week, or $52,348 per annum. However, CCH benchmarking data reveals that many owners are failing to achieve this level of return. For example:

l Ninety percent of coffee shop owners earned less than the average weekly earnings figure (85 percent of owners earned less than $35,000 per owner pa)

l Seventy-four percent of butchers earned less than average weekly wages (68 percent of owners earned less than $35,000 per owner pa).

l Forty-seven percent of cabinet makers earned less than average weekly wages (over one-quarter of owners earned less than $35,000 per owner pa).