Strathfield Group in tune with franchising
The Strathfield Group has come out of voluntary administration and has a new plan for its business, focusing on franchising and product diversity. Vaz Hovanessian, chairman, explained the retail franchise company's debt has been transferred to a creditors' trust, removing its liabilities from the company balance sheet.
Sixty two stores under the Strathfield banner are now operating, with about 55 of those are automotive retail franchises. The company will continue with a mix of company owned and franchised stores but the growth will come from establishing more franchised outlets, said Hovanessian, as franchising results in better performance.
There are plans to open more than 60 new stores over the next 18 months, including franchised kiosks in high traffic shopping centres.
"Most of the stores will run as franchises to reduce the risk of liabilities, such as leases and employees, to the company. We will increase the number of stores in better locations and improve the quality of inventory carried to increase our margins," added Hovanessian. "We will be giving instore training for better product knowledge," he said.
Stores will be refurbished, and the cost to franchisees will be shared with the franchisor. "It's a combined effort. Franchisees must feel they have the support of head office," said Hovanessian. In a move to better embrace franchisee culture Strathfield has also set up a franchise support committee.
In addition to boosting franchisee presence within the group, Strathfield is pushing into new product categories introducing office solutions, rentals of office equipment, home security and offering finance for its goods.
New branding is supported with a tag line and radio jingle, In Tune With You, which Hovanessian said "refreshes and evokes the brand."
This article appears courtesy of 5 Minute Franchising Newsletter06.04.2009