“This is definitely the most thought through strategy, and we are consolidating where we are to get it in place. We’ve taken the opportunity with a bit of freeze in the market to concentrate on existing strategy,” says Dave Milne.
About two years ago the Noodle Box chiefs (managing directors Milne and Josh James) decided to turn the spotlight from growth to improving the core elements of the business. “How we achieve this requires a focus on basics, and what makes a good food opportunity is training,” believes Milne. “The strategy is to employ more people at head office, so we can be more shoulder to shoulder with franchisees.”
Noodle Box has moved from a system of operations managers to business support managers focused more on the financial aspects of running a business. Now the structure supports one business support manager for betweeen 12 and 20 stores, depending on the level of experience and the region in question. Another four trainers have been added to the team, doubling the level of back-up for franchisees and emphasising the importance of training.
Franchisee training takes six weeks – two weeks hands-on in a company store, two weeks personalised training and setting up operations, then two weeks in their own store. All this is then followed by an assessment.
In addition to this process, the first stages of e-learning will be part of the training offer by the end of the financial year. “What we’re trying to do is have cut-through to franchise staff and trainees, and we offer trainer courses for franchisees, so they know how to train their own staff. They can be really good at the hands-on but they have to be able to pass on the knowledge and this is one part of the puzzle.
“The key we’ve found is new franchisees need to be assessed for strengths and weaknesses. We’re using external companies to work on [providing support in] this, such as doing a business course with Westpac, and providing book-keeping services in the first year.”
In fact Noodle Box now offers any new franchisee signing up for a greenfield site access to 12 months free professional bookkeeping.
“It’s a seven year relationship in our first term, so having the cost of the first year’s book-keeping far outweighs what we get back. It means we can work with franchisees on their business.”
Key ingredients
The Noodle Box network comprises 81 stores, seven of which are co-owned, it’s a level that suits the business, as new franchisees step in once businesses are up and running. “You need to have some stores co-owned. About 10 percent is where we like the balance, and geographically dispersed so we can feel the trials and tribulations of what’s happening in each state,” Milne explains.
And once the system reached 50 stores there were benefits to be gained by larger group purchasing. “Quality of produce is very important in food, as is the pricing percentage in cost of goods (COGs). Labour is tough to control, but we can control COGs,” explains Milne.
One strategy has been to produce own-brand items such as the Noodle Box sauces, allowing the franchise to introduce its own flavours and adjust existing recipes. Asian cooking can be freestyle as the meals are cooked in front of the customer in a minute and a half so manufacturing product allows for greater consistency.
Local suppliers of meat and fresh produce are supported where possible; there is no benefit in a national supply for produce that is freshly delivered every two or three days. And Milne highlights the community aspect to this too – supporting other businesses in the regions in which new franchises are being developed.
Village people
The focus on thinking local emerges in another way too, as Noodle Box picks up on a trend for more individualism in eateries, what Milne calls the village feel. “I spent six weeks in the US looking at one-off eateries and what the bigger brands are doing, and there’s a really significant move to having stores with individualism. I like it.
“We want to bring back a village feel, get away from the cookie cutter approach. Geographical areas are different and we want to create an atmosphere that is a little more individual. It’s a bit more expressive rather than contained.”
Because the key to franchising is the replication of a model of business, and a system of operation, 80 percent of the business remains geared to the same procedures. It is the visual aspect and ambience that will differentiate stores, he says.
“Some areas are very cafe oriented, so we have gone for a warmer feel, with more timber. We started out as very clinical and very clean visually, now we have a mix of express and cafe outlets. If the customers know they can get the same meal but stores are different, it’s more appealing than having them all the same.”
Noodle Box has been focused on serving healthy lunch or dinner meals to customers but is now making the most of all-day passing traffic to introduce snacks and light meals, with the aim of attracting more female customers, and perhaps the after-school market. Of course remaining true to the core premise means healthy Asian food is still the focus.
“We’re trying to bring back the female customer. We introduced a smaller sized box, and on top of this, I think the ability to create lighter meals will only enhance this.”
Serving up more in-house support staff, additional learning tools, strategic alliances to bring in expert knowledge to benefit franchisees, a trend to individualism in store decor, and an expanded menu offering franchisees more sales opportunities: Noodle Box has its sights firmly set on its goal of leadership within the Asian fast food sector.