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franchise development: starting from scratch

franchising YOUR OWN BUSINESS

ENSURE ALL YOUR FRANCHISES ARE COMPLIANT

with our franchise management software

Philip Morrison provides an introduction to what you’ll need to think about when franchising a business

To arrange a demo, email us at sales@franchiseinfinity.com. Visit www.franchiseinfinity.com for more information.

G PERFORMANCE | COMMUNICATION | COMPLIANCE | LEARNING MANAGEMENT

FRI2277 Franchise Infinity Compliance v3.indd 1

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• The largest Franchise Operation Refilling & Remanufacturing Inkjet and Laser Cartridges in the world • Operating 1650 Stores over 60 countries worldwide • Established in New Zealand since year 2000 with 40 Stores operating nationwide • New store areas and resales available • Full training & support provided • Excellent Returns

Master Franchisee

Geoff Smith

REFILL & SAVE

Tel: 03 446 8600 Mob: 0274 339 829 Email: geoff.smith@cartridgeworld.co.nz Cartridge World stores are independently owned and operated

Why Pay more to print?

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Franchised business networks touch many different industries these days from retail and food to home services and business-to-business. Some are owner/operator businesses while others occupy vast premises with hundreds of staff and thousands of stock lines. The 2017 Franchising New Zealand survey by Massey University suggests that there are 631 franchise systems in New Zealand with about 37,000 franchisees employing almost 125,000 people and a turnover equivalent to 11 percent of the nation’s GDP (read more at www.franchise.co.nz/article/2594). It should therefore come as no surprise to learn that franchising can be likened to Joseph’s technicolour dream coat, with a vast range of inputs intermingled to produce the overall effect. What is appropriate for one industry is not appropriate for another; what works for one business may not work for another. That means it’s important to take professional advice to create a workable and sustainable business model. Over the years, we have observed many DIY-built franchise systems. These are often doomed to failure before they start, or underperform and typically give franchising a bad name. Before you take money from someone else for a franchise, then, you need to invest some of your own money into developing a robust and sustainable franchise format. Use a consultant who has standing in the franchise sector, and beware – not all consultants are created equal. The first question to ask would be: ‘Are they a member of the Franchise Association of New Zealand?’

• Turn Key operation

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reen Acres, the company that became New Zealand’s largest home services franchise, started off with one man mowing lawns in Auckland. From a single outlet in Ponsonby, BurgerFuel has become a publicly-listed company with outlets throughout the Middle East. Fastway grew from a man with two vans in Hawkes Bay to a multi-national courier and post company. Franchising made it all possible – but could you follow in their footsteps and franchise your own business?

where do i begin? As the flowchart (right) suggests, the first place to start is with the business concept itself. Do you have a successful business already? You’d be surprised how many people with an ailing business think of franchising it as a way out of their financial difficulties rather than as a way to get themselves (and others) deeper in the mire. Or are you considering bringing in an overseas-based franchise business model into New Zealand?

pilot operation Either way, you’ll need a workable concept and a proper business plan before you develop a pilot operation. A pilot operation is essential to test systems, marketing, supply chains, service, pricing, margins, seasonality Franchise New Zealand

Summer 2017/18

Year 26 Issue 04

30/11/17 6:16 PM

Profile for Franchise New Zealand

Franchise New Zealand - Year 26 Issue 04 - Summer 2018  

With a change of government and a couple of high-profile employment issues affecting the franchise sector, the latest issue of Franchise New...

Franchise New Zealand - Year 26 Issue 04 - Summer 2018  

With a change of government and a couple of high-profile employment issues affecting the franchise sector, the latest issue of Franchise New...

Profile for paul52