Lottery brands score 5-star rating

By Sarah Stowe | 14 Aug 2019 View comments

FRANdata has awarded five star ratings to Tatts, NSW Lotteries, Golden Casket and SA Lotteries. It’s a ratings clean sweep for ‘the Lott” (part of Tabcorp) which operates all four lottery brands.

These four high performing franchises join Quest Apartment Hotels as the top rated franchise systems in Australia. Quest was the inaugural 5-star recipient, and its ranking announced mid July.

The graduated star rating scale delivers a consistent evaluation of franchises throughout Australia, providing franchisors with an opportunity to stand out from the crowd.

Darryn McAuliffe, CEO of FRANdata, said the review team was particularly impressed with the range of new initiatives introduced by the lottery group to support the financial performance of more than 3,800 franchisees.

The review revealed a high level of investment in the professional development of the leadership and head office teams. This not only helps maintain a clear “culture of compliance” bu also equips them to provide optimal levels of support to their franchisees, said McAuliffe.

Tabcorp’s brands are representative of “listening” franchises, he said. “The good systems are listening to their franchisees, who are listening to their customers, and are then refining and improving the model. They have addressed the financial performance of the franchisees.”

McAuliffe revealed there are more ratings to come in the next few weeks, including some service brands “expected to perform well”.

“The higher ratings we are seeing released are from leading quality brands who value the recognition,” McAuliffe told Inside Franchise Business.

How to score 5-star rating

The Franchise Rating Scale is an independently assessed system for identifying strong performance and business transparency and was introduced into Australia by FRANdata in March this year. The system is a well-established program in the US.

At the time of the launch FRANdata’s US CEO, Darrell Johnson, said “In the US FRANdata has been providing ratings systems and services for 30 years. There are two keys to successful ratings systems – the assessment must be conducted independently, and the assessment must be objectively based on factors relevant to the decision of the prospective franchisee and others (such as financiers) involved in the transaction. The Australian franchise ratings system will bring both.”

Five star brands need to demonstrate a high level of transparency and an outstanding overall level of franchise performance across seven key categories:

  1. System performance
  2. Franchisee financial performance
  3. Franchisee engagement and satisfaction
  4. Franchisor training and support
  5. Franchisor financial performance
  6. Lender relations
  7. Compliance and assurance