What we have learned about franchising
Dena Blackman first heard about franchising in 1983 when she attended a business development seminar and heard a speaker from the US explaining the concept. It wasn't long before she was franchising the home and family care business she had founded nearly 20 years earlier.
"The first thing I learned about franchising was that it is the ideal way to establish national and international presence for a well-known local business with an exemplary reputation.
"It is a way for like-minded entrepreneurial colleagues to have skin in the game and to have their own enterprises profit from my experience and mentorship.
"It can be fraught with pitfalls for the unwary and in the 1980s many franchisors were unscrupulous in their handling of the original licensing of their businesses. The Franchise Council of Australia was set up to bring professionalism to the written agreements between the parties.
"My original franchise agreement was a simple one of 12 pages set up by my franchising lawyer in 1985 and it served us well because we selected the right franchisees and we were caring franchisors who wanted our franchisees to do well.
"Our current agreements are now 65 to 70 pages in length covering almost every aspect of the relationship. This can create concern in a prospective franchisee who may feel that there is no leeway for intelligent compromise by either party.
"I have always wanted each of our franchisees to be millionaires in their own successful businesses. If they do poorly, we receive no income from them and they are discontented colleagues.
"It is important to have close and frequent communication both ways. Nurturing a new franchisee is very time-consuming but if it is done well, your franchisee will gain confidence faster and not be so demanding of time and energy in the long run.
"Our association with one of our original franchisees lasted for more than 25 years and the others have also been long-standing and outstanding successes.
"My company Angels & Associates Pty Ltd is the franchising arm of Dial-An-Angel and although we are not in “the business” of franchising but in the business of home and family care and support services, we like to share our 47 years of experience in the industry with our carefully selected franchisees.
"One of the most important aspects of franchising is the development of a proper “package” to present to a new franchisee. This includes a training programme and the tools with which to start their venture.
"From the franchisor’s point of view, the incoming franchisee must be prepared to listen carefully and learn quickly and not assume that they understand every nuance of the new business venture.
"Nothing is geared to irritate a franchisor more than (after providing the franchisee with all the “tools” to access frequent Q & As) than to have them phone at all hours for the same information.
"I believe that the success of a franchise lies in the selection process. I have always chosen capable caring franchisees with people skills and sound business principles. Business acumen may be assessed by their previous exposure to the various skills required in running their own businesses.
I can’t emphasise communication enough. Feedback as to how the franchisee is coping or the advice of any major changes being contemplated or initiated by the franchisor are integral to the relationship."
Danielle Robertson is the second generation of the business
"I began working in the family business in 1986 just after my mother Dena had commenced the franchising of Perth and Melbourne in 1985. Franchising was relatively new at that time and both Dena and I learned as we went.
"Initially, the franchises loved the fact that we had the ability to assist them to grow their businesses with our many years’ experience, knowledge, policies, procedures and systems.
"It was evident early on that the franchises were quite entrepreneurial which is great in one way but they would often make changes to policies and procedures without letting us know. It would only be when we visited the office to audit when these sorts of changes were noticed.
"We learned that we needed to communicate better with the franchises and encourage them to come up with ideas and collaborate with us as a franchisor. We had a network of offices developing which could have all benefited from the ideas or changes. It took a significant time to alter the culture and advise them that it was ok to make tweaks and changes but consistency across the group was imperative.
"Over the years, everything has become consistent. It has to be! Going through ISO 9001 Certification has meant that all offices (franchises and company owned) are audited not only internally but externally.
"We have a fabulous document management system with version control which assists us with consistency. There are no grey areas now and the franchises are most compliant in all facets of the business. With continuous improvement on all our minds, it works a treat when a local area comes up with an idea that will aid productivity nationally.
"The key to success is to ensure your franchises share the same values as you and fit your culture – it will make it easier to work with them and assist them to grow their business and build your brand."