Modern Franchise Magazine February - 2012

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February 2012
Franchise What the Most Growth in 2012. Successful Franchisees This Time Its Have In Common Different!
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Whats in this months Magazine?
Regular Features Page 4: Page 8: Page 28: Welcome Franchise Focus Modern Franchise
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Special Features Page 6: Page 16: Page 20: Page 24: Page 34: Page 58: What do the Most Successful Franchisees Have in Common? Recruiting From Within - Multi-Unit Franchising Franchise Growth in 2012. This Time its Different. The All-Important Features Top Franchises Possess 5 Secrets to Effective Franchise Websites Understand Why People Buy Franchises and Youll Attract more Franchisees
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Profiles Page 10: Page 28: Page 42: Articles Page 10: Page 14: Page 18: Getting Your Business Ready to Franchise Does the Franchise Sector Need an Overhaul? Are You Confused - New WHS Standards? Maxiom Jobs MPH Fair Work Ombudsmans National Franchise Program
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Page 30: 5 Ways to Motivate Franchise Staff? Page 34: Page 38: Page 60: Warning Signs When Buying a Franchise Franchising is Still a Great Way to do Business Taking Over an Existing Franchise
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The Modern Franchise

with Mark Matthews Welcome to the February 2012 Issue of Modern Franchise Magazine. 2012 is shaping up as a year of transition for many industries as more sectors adapt to the changing business environment. Franchising is no exception. We look at some of the factors that will effect the industry and some of the lessons from the past.
The franchise sector has been hoping for a revival in 2012. There have been many predictions of a boom year for franchising, but this time will it be any different (page 20)? Staff Management & Careers Features
If marketing is what drives franchise In franchise focus we talk to me success, your staff are the key to about our new Maxiom Jobs service delivering the results. and why EVERY business just cant survive without us! We look at ways of motivating and getting the best performance from Michael Polo Homes are growing There is plenty of rhetoric being franchise staff and how to find the their business through franchising. thrown around about franchising best staff for your franchise. We take another look into why this and what needs to be done to boost strategy is succeeding for them in the sector. So we ask Does the Looking for a franchise? Modern Franchise. Franchise Sector Need an Overhaul? There are some great tips to find Mark Fernandez from BDA talks out if a franchise business is right about multi-unit franchising and Despite all the commentary, the for you, taking over an existing recruiting from within. franchise sector is still franchise and the warning signs to outperforming most and franchises look out for when buying a We also look into the all-important in general are more profitable and franchise. features that top franchises posses, successful than similar nonplus much more. franchised businesses. In Why Franchise Management Franchising Is Still a Great Way There are also a number a really to Do Business We Look into the The Fair Work Ombudsman has great franchise opportunities Reasons Behind This. released a National Franchise advertised! Program, but will the industry be Sales & Marketing interested? Siimon Reynolds is also holding Strategic Entrepreneur events If any one factor was more iimportant Joanne Solis walks us through the around the country. Be sure to to business success than all others harmonised WHS legislation download his new ebook How to its marketing. Its something every amongst all the confusion regarding Attract New Customers Quickly business has to be expert in. So we and Easily from page 15. Its talk about The Sales And Marketing non-harmonised states and who, how and when you should comply. absolutely free plus if youre quick Skills You Will Need As A you can also get your hands on Franchisee. some discounted tickets to this event which anyone in business will There is also another great article by not want to miss. Chris Anderson - 5 Secrets to Successful Franchise Websites and Enjoy the magazine. All feedback is Kristn McNicol discusses Why Your appreciated. Visit our website at: Employment Brand Is So Important. www.maxiom.com.au
4 | Modern Franchise Magazine
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Modern Franchise Magazine | 5
WHAT DO THE MOST SUCCESSFUL FRANCHISEES HAVE IN COMMON?

Buying a Franchise and taking advantage of all that franchising has to offer can give you an opportunity to be self employed and gain some control over your career. By Daren Coudriet
If you have never been a all do. If you have great people business owner, youre probably skills, you are definitely getting wondering if you have what it into the right business. takes. You will probably find that you will While it is commonly known that be able to publicise your franchising offers opportunities business and build loyalty with to people with all kinds of skill your customers easier if you sets and backgrounds, there are choose to reach out. definitely a few attributes that a lot of the most successful They Have Determination. franchises have in common. For a franchise to have a chance They Know How To Network at becoming successful, the First of all, make sure you know owner needs to be prepared to that when you choose a location do whatever it takes to achieve for your franchise, you are also that goal. choosing your professional community. Especially at the beginning, owning a franchise is not relaxing If you have great networking 5 days a week. If you want that skills, you can thrive in a good dream to happen, it starts with an business community. Get to intense amount of real, hard know your neighbours and other work. Getting squeamish yet? business owners in your location. Look into joining local community No? Read on. Building your and business organizations like customer base, training the local chamber of commerce. employees and understanding your own learning curve is going This is a critical part in to take some time, and you must connecting with other business be determined to stick it out. owners, and it's something that the most successful franchises The more willing you are as a person to put in the necessary work, especially at first, the better chance you have of becoming the owner of a successful franchise. A commonly acknowledged fact in the business world is that franchises are statistically much more likely to become successful than an individual start-up. In part, this is likely because many of the "pieces of the business puzzle" have already been put together for the business owner buying the franchise. Many mistakes that may have been made in starting a business from scratch are avoided because of the nature of a franchised business. Additionally, the owners of the most successful franchises have the chance to carefully pick their franchise and can review and get comfortable with their business strategy before they start the business.
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THE MUST READ MAGAZINE

FOR ALL BUSINESS LEADERS & ENTREPRENEURS
Even with these bright statistics on your side, you can't be a person who shirks from hard work, because buying a franchise doesn't mean it is going to be easy. They Can Learn AND Lead
Also, many franchisors will have training you can provide your staff, which helps you to transfer this same knowledge. If you are unable, unwilling or uncomfortable executing someone else's system, you are probably much better off starting your own business than entering into franchising.
MODERN BUSINESS MAGAZINE
Another key to being a the owner of one of the most successful franchises, So do you think you've got what considering the initial learning it takes to be one of the most curve of getting the business started, is the ability to both give successful franchises? and take direction. Buying a franchise is not a The entire point of franchising is substitute for these basic that the customer gets the same elements of success. great service and/or product from your franchise and all the If you're able to follow a proven franchisees by following a system, have a great set of proven system. leadership skills, can network like a monster and have the So, you will need to learn the determination to do whatever it systems and processes that takes, then you may just have have made the other franchisees what it takes to take control of successful, as well as lead your destiny and achieve your others as you hire staff. dreams through franchising. This could be challenging at times, but keep in mind learning a system can be much easier than trying to create one from scratch.
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Daren Coudriet is a business and technology consultant focused on helping prospective franchisees find the right franchise for them.
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GETTING YOUR BUSINESS READY TO FRANCHISE

Quite a lot of well established businesses are faced with the issue of how to develop their business further than its current potential. By Jaz Campbell
Franchising is often considered as a recognised method of expanding your business without having to take on the immediate running costs of operating extra business owned outlets. One of the disadvantages, could be the income potential. Since you do not own the additional units, the potential revenue you receive as a franchisor is mostly a small portion of total earnings, typically known as a Basically, it comes down to a few Management Fee, Royalty or of things if it's an appropriate Franchise Service Fee. The total road for your business to take. turnover from the franchise isn't The benefit of making your yours to manage but rather you business into a franchise will take a cut for being the business is really the expansion controller of the franchise brand potential it can offer. and supplying on-going support and brand marketing. A franchised business could develop more rapidly than via You will need to make sure that company owned expansion you are likely to be able to sell since it's not so reliant on finding enough franchises in order to company resources to fund every reach critical mass. This is additional business unit. Each when the number of franchises individual franchise operator is operating brings in enough usually responsible for funding income for the franchisor to be their operation and taking care of able to provide all the support its overheads. services and marketing support it needs to successfully operate Another key consideration is the franchised business. whether or not the commercial formula you have (the business Not every business should be model) will actually translate well franchised. If the current into a franchise. If the venture has business is very reliant on the a central set of principles and personal skills and abilities of the systems which can be key individuals who are documented, replicated and operating the company, then it is packaged then converting it to a perhaps harder to replicate. franchise could be a viable path Businesses that are seasonal or for you. are based on a fad should not be franchised. There is also a This tends to facilitate a faster different management and development process. cultural approach required by franchisors. 10 | Modern Franchise Magazine Not all business owners are suited to become franchisors. Contacting a reputable and professional franchise consultant is a good place to start when deciding if you should franchise your business. Contact several, get their advice and then decide which one you will choose. Once youve determined if your business should be franchised, getting your business to the point where it can be franchised takes time and there are considerable costs involved. These dont just include preparing the legal documentation and Franchise Disclosure Documents. You will need to document every process in your business and have clear easy to follow procedures for every process and stage of the business. In fact, if you havent already documented these procedures then franchising may not be for you. You will also need a very strong marketing plan and have developed a brand. Your business must stand out and be perceived as a (if not the) market leader. However, if you do have a well run and organised business model there are many advantages of turning your business into a franchise.
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DOES THE FRANCHISE SECTOR NEED AN OVERHAUL?

Emotions are running high amongst the keenest supporters of the Franchise Council of Australia over the recent appointment of leading competition lawyer Frank Zumbo as the SA Deputy Small Business Commissioner. But is this just a reflection of another sector struggling with the changing business environment?
In the past week weve seen Franchise Council of Australia chairman Steven Wright launch a scathing attack on newly appointed Deputy Small Business Commissioner Frank Zumbo bordering on the extreme. Leading SA based franchisor Mark Langford, CEO of Game Traders has also launched an attack on Zumbos appointment, and Queensland based franchise consultant Jason Gehrke has been a strong voice in opposing the legislation. It should be noted that these opponents of Mr Zumbo and the legislation are also FCA directors. Mr Langford is also listed on the FCA web site as SA State President. Of course the franchisee groups have the opposite opinion on the SA legislation and appointment of Mr Zumbo. The FCA has also been criticised as just representing the big end of the franchising town. So in mustering its troops around the country to attack the SA Deputy Small Business Commissioner so hard is the FCA risking creating an Us vs 14 | Modern Franchise Magazine Them culture between franchisors and franchisees? The supporters of the South Australian Small Business Commissioner Office think this is In response to the conduct of the very thing that Mr Zumbos South Australian based franchise appointment will provide. Refund Homes Loans (now in administration), ACCC Obviously not everyone agrees. Chairman Greame Samuels made the statement that What is obvious is that a single "Franchisors and franchisees National approach to franchise have a special business regulation is preferable. What is relationship. Franchisees trust also obvious is that the their franchisor to provide honest Franchise Code of Conduct, and reliable information as to while generally good in their own business and about construction is lacking in franchising generally and to compliance incentives and mislead them in this manner is enforcement. an abuse of trust." With new Federal Small It seems that the trust between Business Minister Mark Arbib the various stakeholders in the still in the process of getting his franchise sector is being head around the portfolio it undermined by some petty seems unlikely well see any industry politics and the parties developments on this front for a are moving further apart which while. cant be good for the industry as a whole. So where does that leave franchising? Franchising in Australia is worth $130 billion annually, with over The sector is still outperforming 70,000 franchisees and most others in our economy. employing over 600,000 Individual industries are generally Australians directly and many performing better than their nonmore indirectly. franchised counterparts, so why is the sector stagnating and The sector badly needs some divided? strong direction and leadership.
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RECRUITING FROM WITHIN MULTI-UNIT FRANCHISING

The latest buzz word in franchise recruitment is Multi-Unit Franchising but what does it really mean?
By Mark Fernandez What are the benefits to the franchise system and what systems need to be in place? Over the past year the concept of franchisees with more that one franchise has become very popular. With the current economic climate causing banks to maintain a tighter lending profile, recruitment for new franchisees has become very difficult. A number of systems have reported that by looking internally and expanding franchisees from one outlet to two and even three to four, has not only reduced the time taken to find franchisees, but have stated that by knowing the person already involved in the business has made it easier to manage overall and has reduced the risk. However, if you are looking to expand and become a multi-unit franchisee here are some questions that you should consider: How hands on do I need to be in the operations? What people do I need to have in place to run multiple operations well? The benefits can be rewarding over the long run and with expansion also bring excitement!!!
Once you have decided to take on another store or location, What expectations does your people become even more the Franchisor have of critical to your success. The old multi-unit franchisees? saying you cant be in two places at once becomes very What will be the impact on real and you need to trust in my current operations your people even more and let financial, resources go at times. Do I need to do any retraining with the Franchisor to ensure that I remain current with the franchise systems and procedures. What technology do I need to have to enable me to better manage the businesses What have I learned from other multi-unit franchisees in the system? Multi-Unit franchising is the way of the future as more and more franchise systems move away from tradition methods of recruitment. For more information on Multi Unit Franchising, please
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ARE YOU CONFUSED? - THE NEW NATIONAL WHS (OH&S) STANDARDS

Even though not all states have enacted the new harmonised WHS Laws businesses are urged to ensure they meet the new Standards.
By Joanne Solis Despite concessions from the Federal Government that grant businesses up to 12 months to implement the regulations if they create new duties for organisations, compliance with the harmonised WHS Laws may still be required (if not desirable). Victoria, Western Australia, South Australia, and Tasmania have now also committed to adopting the new laws within 12 months. Until this time, each of these States will use their own existing legislation and guidance materials. Though, as many requirements of the new WHS laws are equally relevant to workplaces in nonharmonised States obligations of the new laws can be followed in many situations without being in breach of the current laws in those states. It makes good business sense, where no conflict exists with the current laws, to move to the harmonised obligations. Building-up Consultings advice to all clients is don't wait - ensure you are prepared now, because in many ways this is best practice so there's little downside. By now all franchises should have undertaken a review of all their WHS practices, procedures, manuals and policies. Franchises may need to implement training to ensure that all managers, franchisees and employees are up to speed with the changes and understand the requirements placed upon them. Special care should be taken when reviewing both franchise and contractor arrangements under the new laws and their franchisee and contractor management systems, and make sure their staff are prepared for the changes. Company directors and managers must be aware of the positive obligation on an officer of a company to exercise due diligence to ensure the company is discharging its safety obligation.
Another consideration is that under the new WHS regime, a business based in a nonharmonised state that contracts This doesnt mean businesses in with and supplies goods or services to a business in a these states do not need to jurisdiction where the harmonised comply. WHS Laws are in effect may find Companies that operate across itself subject to those Laws as a worker, designer, manufacturer, multiple states may still have to supplier or other capacity. maintain state relevant policies for non-harmonised states until So for example, if you are a the laws (with or without Victorian or West Australian amendments) are passed in franchisor with interstate these states, while complying with franchises or customers, it makes the harmonised WHS Laws in all good sense to ensure you comply other jurisdictions. now!
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FRANCHISING GROWTH IN 2012 - THIS TIME IS DIFFERENT?

In 2010 Carmen M. Reinhart and Kenneth S. Rogoff wrote a book entitled "This Time is Different: Eight Centuries of Financial Folly". While this article is written with the US franchise market in mind it in many ways mirrors the Australian franchise sector since the Global Financial Crisis By W.C. Garth Snider
Writing on the heels of the Global Financial Crisis & Great Recession the book's message was a simple one: no matter how different the latest financial crisis always appears, there are remarkable similarities with past experiences from other countries and from history. In fact, the IFA has restated its numbers for the previous year's franchise unit growth in each of the last three years. For example, the 2012 report said that the number of franchise The International Franchise establishments in 2008 was Association reported that 2012 774,000; the report in 2011 will be the year that franchising stated that the number of rebounds. Last month the IFA franchise establishments in 2008 We have been here before. released its Franchise Business was 791,000; and the 2009 Other nations and other leaders - Economic Outlook for 2012. In report claimed that the number in notwithstanding the hubris, or short it stated, "after three years 2008 was 864,000). maybe because of the hubrisof restrained growth, due to the always think that this time is recession and its lingering But in light of This Time is different. effects, franchise businesses Different what struck me as show signs of recovery in the particularly interesting about this The vast range of crisis year ahead." The IFA went on to latest pronouncement from the considered and analyzed in This state that "franchise business IFA was the statement by Time is Different demonstrates growth has been restrained over Stephen Caldeira, President of the past three years due to that excessive debt the IFA, in which he said in underlying factors, such as the accumulation, whether it be by referring to 2012 "the rate of weak rebound in consumer the government, banks, growth is far below the growth spending, that have been a drag trends we experienced before corporations, or consumers, often poses greater risks than it on the economy as a whole. In the recession." Most individuals addition, tighter credit standards understand that the growth that seems during the boom. "Debt have limited the formation of new franchising experienced in the 4fuelled booms all too often franchise small businesses and 5 years prior to the GFC was provide false affirmation of a governments policies, a financial the expansion of existing fuelled by the exact same businesses." (I think it important economic and financial factors institution's ability to make to keep in mind that the IFA has that gave rise to the larger outsized profits, or a country's standard of living. Most of these been forecasting for the last 2-3 macro-economic bubble-and it years that this year will be the booms end badly." subsequent collapse. recovery year. 20 | Modern Franchise Magazine Almost two years after the Great Recession officially ended the franchise market writ large is still struggling to cope with the boom that ended badly.
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Thus I think the most important question that we in the franchising industry must ask is what growth rate do we want and what growth rate should we expect?
account deficits, and a slowing trajectory of economic growth, exhibited virtually all the signs of a county on the very of a financial crisis-indeed a severe one." A severe one indeed. We have millions out of work still, and those that are employed have seen their wages stagnate and their home value drop precipitously and not recover.
Overall the analysis of the post crisis outcomes for unemployment, output, and government debt provides sobering benchmark numbers for how deep financial crises can unfold." Notwithstanding the remark of the executive I reference above, I do not think most in the franchise industry-nor the countryconsciously want another liquidity bubble. The out-sized short term profits fuelled by a large amount of liquidity in the system appear to be Faustian bargain that few in the franchise industry want to engage in again.
If we expect a growth trajectory similar to the 4-5 years prior to the Global Financial Crisis how do we plan to achieve that without a similar type economic environment? Or, do we care how we get there just so long as But that is exactly what history we do? has shown always occurred after a financial crisis. Reinhart and Toward that end, recently I had Rogoff state: "an examination of an executive remark to me that the aftermath of severe postwar he hopes that we experience financial crises shows that these another liquidity bubble because crises have had a deep and it would return the franchise lasting effect on asset prices, market to its pre-GFC days. output, and employment.
What the executive likely meant was that he wanted another great macro-liquidity event in our But is that what we really need Unemployment increase and Nation's economy, he just did not and/or want as an industry? house price declines have want to have it become a extended for five and six years, "bubble". In that case, he, as well Turning again to This Time is respectively. Real government as most in American business Different, the book reminds us today, is eagerly awaiting the that the boom we experienced in debt has increased by an average of 86 percent after three next economic boom. And if that America was powered by a years. Historical experience is boom is to be fuelled by liquidity bubble-a bubble that complicated financial was destined to burst-and was that V-shaped recoveries in equity prices are far more instruments and unrestrained fuelled in large part by the subaccess to the debt markets then prime mortgage market. "In the common than V-shaped recoveries in real housing prices "this time will be different" is the end run-up to the sub-prime refrain that is soon to be crisis, standard indicators for the or employment. repeated. United States, such as asset price inflation, rising leverage, large sustained current
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But as Reinhart and Rogoff detail with much precision it is unlikely from a historical perspective that the next time will be different. "The fading memories of borrowers and lenders, policy makers and academics, and the public at large do not seem to improve over time, so the policy lessons on how to avoid the next blow up are at best limited. Technology has changed, the height of humans has changed, and fashions have changed. Yet the ability of governments and investors to delude themselves, giving rise to periodic bouts of euphoria that usually end in tears, seems to have remained a constant." Franchising touches all segments of our economic society-technology, labour, finance, consumer, etc. Franchising will wax and wane depending on the over-all economic health of our country. The question that must be answered is this: will franchising plot a course that is complimentary too, but not dependent on, the next banking and finance led boom?
So when many in the franchise industry lament that availability of finance is holding back franchise growth, is that actually a bad thing? Or, will franchising as a industry continue to aim for, and the IFA continue to lobby for, the good 'ole days of "outsized profits" and rapid franchise unit growth fuelled as it was by what we now know to be an excess of debt accumulation both on the microand macro level of our economy? My guess is that few are even thinking about the future of franchising in these terms. Most simply want growth, and they care not how that growth comes about. (Of course this is how most in our country feel and is the emotional genesis for the boom and bust cycles examined in This Time is Different.)
If by loosening the IFA is silently longing for the loose credit standards that reigned supreme in the middle of the last decade then that perhaps is the wrong path down which to proceed. If it is not, then it is incumbent upon the leadership to set forth with more particularity the goals because liquidity in the system is inextricably linked to the franchise growth projections. In order to assure that we in franchising do not repeat the mistakes of the past, the franchising industry needs perhaps a different approach.
The industry needs leadership that does not repeat nor countenance the thread-bare and statistically suspect mantra of "franchises do better in recessions." We need leadership that understands that while prospective franchisees Every six months the IFA (and FCA) puts out a statement about are more difficult to come by now then they were prior to the Global how the tight lending standards Financial Crisis that may not are retarding the growth of necessarily be a bad thing. franchising. While that is undoubtedly true, it would be helpful to learn exactly what the IFA deems as the optimal level of liquidity in the system. In the same way that it is now settled wisdom that there were many who were allowed to take out a mortgage five years ago
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that should not have been permitted to do so, so too must the leadership in franchising state unequivocally that there were franchisees that should not have been awarded franchises and business that should not have been franchises as well.
many franchise establishments exist today-and if you read the reports carefully you will see that the PWC reports state that 2007 was the first time that there was enough data to even put forth a sound estimate.
So while 1.9% may well be the And if that be the case, then the appropriate and realistic growth growth rate that was rate for 2012, given the track experienced in the years leading record of the reports put forth by up to the Global Financial Crisis the IFA we must be more than a cannot be the benchmark for little sceptical about the numbers growth in the next decade. set forth.
Simply running the same plays out of the same playbook, and using statistically suspect boom year expectations of growth is not a game plan for long-term success. We have read this book before. We know how it ends. And no, this time will not be different.
Garth Snider is the President and General Counsel of one of the largest franchise lead generation firms online. He has a degree in finance and banking from the University of The economic outlook published All of us with a stake in Georgia, and a J.D. from Emory for 2012 projects an increase of franchising want to see University. Garth Snider has franchising grow again. We all 1.9% in franchise experience in commercial believe in the fundamentals that establishments. litigation as he had practiced for under-gird its special place in our economy. In order to achieve the law firm named Griffin But as stated above, the one Cochrane and Marshall from a prudent and sound franchise constant with the economic growth rate we need "tough love" 1998 to 2003. He is presently outlooks produced by the IFA leadership and sober, intelligent the President of Ad Engine over the last four years is that which is an online company responses to the challenging each year the reports change providing lead generation many of the figures stated in the times in which we live. services for franchises and previous years report. The Doing so, however, requires an small businesses. reports do have a convenient escape mechanism in that all of honest appraisal of how we got here and whether the good 'ole the reports state that the days were really that good. numbers are "estimates". In other words, neither the IFA nor the high powered accounting and consulting firms commissioned to compile the reports know conclusively how
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THE ALL-IMPORTANT FEATURES TOP FRANCHISES POSSESS

With literally thousands of franchises in business today, you can quickly become mentally exhausted when researching which opportunity is the best.
There is no "best franchise" out there that all franchise seekers should sign on for. Do you honestly believe that there is this line of people a mile long outside of McDonald's franchise development office? Of course not. So why is this? The answer is rather obvious. What is best for you may not be best for me. Maybe you love the idea of managing 10 or 20 employees and would thoroughly enjoy the pride and prestige of franchising for the world's best known fast food brand. Someone else may have just been laid off after 20 years of service for a computer software company and now wants to pursue his dream of a franchise opportunity that is home based and requires no employees. You see, it all depends on your unique values and interests. The product or service you offer should be secondary to the type of lifestyle your business will allow you and your specific role as a franchisee. That being said, however, there are several essential features to look for when evaluating any franchise business. 24 | Modern Franchise Magazine Stable industry. The leader in it's category. You need to be marketing A major contributor to your something that will be profitable potential success a franchisee is no matter the economy. teaming with a franchise in which they are the undisputed A necessary, recessionleader. resistant product or service. A dominant brand. Choose something that consumers either don't have time to do or make or despise doing and, thus, would rather pay someone else for. Stay away from fads, as they are unpredictable and don't provide longevity. Market potential versus the competition. It's wise to choose a franchise that has little or no competition from other similar, established franchises. Brand recognition is huge. This is a major reason to franchise in the first place. Growth Opportunities. Look for a franchise that encourages you to grow within their group. Try securing the rights to the surrounding sites or territories so you have room to grow and limit competition from within your own group!
Some franchise systems offer area developer or a master franchisee options. These are There are exceptions such as food courts in shopping centres, strong indicators that the but in general you dont want to franchise is thriving and planning to expand and grow the be in direct competition at the business. sale location with a major franchise or national chain. There are franchises out there Franchising is about three that provide these key things: location, location, components. location. The tricky job is identifying and finding them.
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WANT TO FIND THE BEST EMPLOYEES FOR YOUR FRANCHISE?

Think like a headhunter! Give the job to someone who can do it; not someone who has done it before.
There is much to learn from the way executive search firms operate within the recruitment sector. If you take leaf out their book you can improve your chances of recruiting the best people for your business, regardless of your size or time in business. Like all good recruiters, search consultants are all about reducing the risk for their clients. They too, like you, run a business. They dont get hung up on whether people have actually done the job before. When many recruitment firms advertise a job, they invite applications. Applications are usually about experience. What you are looking for is competence, not just experience. Dont get too hung up on qualifications. Most executives left university 20+ years ago. Its the 20 years since that employers should be interested in. Many of Australias highest net worth individuals either just finished high school or barely scraped through university. In the end its not what youve got that counts - but what you do with what youve got. Competence and attitude. Having the attitude to get the most out of what youve got and the competence to achieve it is what you should be looking for. And remember, before engaging a recruitment firm, think whether outsourcing that job (or part of it) is a better option and redefining the position to suit your business aims. You might already have that superstar in your business...or you might discover a different set of skills will be better suited to help you achieve your desired results.
I cant tell you the number of horror stories Ive heard from leading business people and entrepreneurs about hiring someone with experience over However, they think outside the attitude. Finding competent box. Their first thought is, who people is the key regardless of can do this job and what are they experience in a role. doing now? They dont just rely on experience or expertise. Unless you are looking for a medical specialist or lawyer, The lesson is to be more creative vocational experience only counts in your search. Recruiting people for only so much. Competence is according to what they can do, much more important. not what theyve done offers businesses greater opportunities The person doesnt have to have to find a superstar! done the job before, but they do have to be able to do it. Look at the way big businesses recruit & promote. They promote and employ on potential.
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modern franchise
A HOME BUILDING FRANCHISE WITH ONGOING WORK READY & WAITING FOR THE RIGHT FRANCHISEES.
Starting a home building franchise from scratch has provided some interesting challenges as Mike James from Micheal Polo Homes explains.
1. What inspired your business idea? MPH is part of a strong and exciting industry. Having constant contact with people from all walks of life, creating thier dream home and realising their personal vision, combined with an environment of working so closely with clients that they become your friends, it is hard not to be inspired. we needed to find the right strategy to tackle the increased work load that we had created. In the back of our minds however, we felt that franchising was a viable option as the industry we operate in is a very fragmented except for the largest players. The top 100 builders now hold around 40% market share. But there are around 50,000 other buidlers fighting for about 30% of the total market, with owner builders comprising most of the rest. The franchising system we have created with the assistance of our franchise consultant provides the advantage of buying power, innovation as a group to be at the fore front of market trends, professional marketing campaigns, long established industry experience, all whilst maintaining the personal level of service to our clients as they will be dealing directly with an owner of the business. 3. What previous experience did you have in the business before franchising?
2. How did you know franchising was right for you The disadvantage of these and what ultimately smaller business structuctures influenced your decision? purchasing power, state of the In addressing our future growth art marketing and innovation is plans we engaged the services restricted, so we decided that of a leading franchise consultant. we needed to become a top 100 builder ourselves. We were open to
Having come from a long line of builders in the UK and Europe, on both sides of the family, building & design have been in our blood. This extensive recomendation for the most In this assessment of the industry and technical applicable path for our company. industry franchising was the right knowledge and our broad decision for MPH. business experience, enables Having worked with Maxioms us to direct the MPH business marketing people to grow our well into the future. business as quickly as we have, 28 | Modern Franchise Magazine
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7. Tell us about some of the expectations that you had. Have they been met? So far everything has been in line with our expectations. These are exciting times. 8. Who is the target market for your franchise? We are looking for people to join our team who are passionate about servicing clients, who ideally have a building background or who have been involved in some area of the industry, and who have a keen eye for detail. More important is a can do attitude and someone who enjoys being creative. 9. How many units of your franchise do you plan to establish in Australia? Over the next 3 years we plan to establish 18 franchises and 40 within 5 years. 10. Do you have any plans for overseas expansion? At this stage we have no plans for overseas expansion, though we have already had enquiries. However, at this stage we intend to make sure that our franchise system is succesful in Australia and that we meet all our targets for growth and customer satisfaction before we look at other markets.
Michael Polo Homes lives by its service promise designer homes built on time and on budget; every time .
4. How long did it take to develop and set up your business? Whilst we have had over 30 years building & business experience, franchsing took us some time to learn and we spent over 2 years setting up the franchise system. Developing our business is constant and always will be, everyday we are developing more and more.
6. What challenges did you face in setting up your franchise?
The biggest challenge in setting up a customised franchise system is the amount of variables to work through. This challenge can be overcome as long as you maintain the intergrity of your company values at every decision point, and make a decision that best provides the oppotunity for both 5. What was the driving force the franchisee and the franchisor to make healthy profits so the behind your decision to business system is sustainable franchise? in the future. Sales growth left us no option Working with our franchise other than to expand. Our decision to franchise was based consultant was fantastic, on wanting to maintain product combining our concepts and visions with their franchise quality, engage people with a true passion for their work, have industry experience, resulted in a franchise system that we are strong technical knowledge and personalised service to the 100% comfortable with and client. All of this can be achieved believe in. through the franchise structure. 24 | Modern Franchise Magazine maxiom
Modern Franchise Magazine | 29 maxiom
5 WAYS TO MOTIVATE YOUR FRANCHISE EMPLOYEES

When you buy a franchise, if you haven't already owned your own business before, you probably have to make the difficult transition from working for someone to having people working for you. By Elise May
Being an employee is very different from being the boss. You have to be a good and effective manager in order to gain the respect of the people working for you. It is not as difficult as it sounds, as long as you are willing to put in the effort to motivate your employees. 2. Train your employees well, and keep them up-to-date with training. If you slack off on training your employees, they may feel like they are thrown out into the world without the ability to do their jobs effectively. If they feel poorly about how they are doing, are being yelled at by customers, or worst of all, if you Motivating your employees will blame them for doing a poor job be vital to your success. If the because they aren't trained well, people who work for you want to they are going to feel resentful be there, they will work harder and upset that you aren't giving and make your franchise even them all the knowledge they better. Here are some ways to need to do a good job. motivate your franchise employees: Keeping your employees trained will make them feel good about 1. Praise them if they are doing their job knowledge and will a good job. This is the simplest make your business better. thing and is very easy to implement. You should be able 3. Let your employees know that to tell who is working hard. If you they can advance. If your recognize them for doing a good employees see working at your job, it will show them that you franchise as a dead-end job notice and care how hard they where they have no work. This will make them want opportunities for promotions, to work harder. By contrast, if they are not going to work as your employees are working hard as you need them to. hard and doing a great job and you never recognize their efforts, If they know that good they are likely to stop trying so employees are rewarded with hard, and may even begin to advancement, they are more dislike you. likely to be good employees. But dont praise just for the sake of it. Your employees are not idiots and will see through this. 30 | Modern Franchise Magazine 4. Keep your work environment positive. If your work environment is clean, safe, and honest, your employees will feel better about working there. You do not want them to feel uncomfortable. 5. Be nice to your employees, if they are doing well, or even just because. You may want to organize a lunch or party for your employees, so they experience camaraderie with you and their fellow franchise employees. Happier employees work harder. These are just a few possibilities. There are many effective ways to motivate your employees beyond this list. In fact, if you are a new franchise owner and were previously an employee yourself, you can probably think of several ways that you felt motivated at a previous job, and use those ideas as a manager.
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THE 5 SECRETS TO EFFECTIVE FRANCHISE WEBSITES

By Chris Anderson
Its shocking that in 2012, so many small businesses and franchisees are still without a proper marketing website to help boost lead generation, sales, and if nothing else just to get on the radar of would-be customers. Blaming the economy or uncertain retail conditions is a tired excuse for why your business is suffering. Stop worrying about things you cant control, and start focusing on the things you canlike having a real website! For all of the franchisors out there with your heads in the sand, here are some of the top reasons you NEED to have effective websites for your franchisees (and for those reading who simply have cookiecutter, template pages that are almost exactly the same across the board, this applies to you too): 1. Investing Time in Social Media is a Waste Without a Website Take a look at your social media presence, and research your franchisees Facebook, LinkedIn, and Twitter profiles surprised to see how much activity there is? Now, look closer to see if theres an underlying strategy to convert those discussions in social media into leads and ultimately sales. Chances are this is where the ball is dropped. Thats where a website comes into play all of that great momentum can be channeled to a controlled website optimised to convert traffic in paying customers. 2. Control Your Businesss Voice Online The solution is to have a website that you can ALWAYS point people to, regardless of the With a website that is designed to communication channel (traditional have frequent content updates, you advertising, banner ads, PPC, can take control of the messaging, social media, etc.). and have a strong positive influence on your search engine 5. Generate Leads and Sell! rankings (SEO). Social media is the great equalizer allowing Most importantly, you need to have customers to join the conversation a SALES channel online that is the without barriers to entry. But hub where youre looking to convert owning the control of your brand traffic into leads, leads into and messaging through having a customers, and customer into website is still vital. evangelists. Social media is an excellent vehicle to connect with 3. Gather Customer Information people, build personal relationships, improve branding, Collecting visitors emails and other and a host of other benefits, but its information through your website pretty tough to convert those warm opens an amazing opportunity to fuzzy discussions into sales. With maintain communication with a website, you can have a potential and existing customers prominent sales call to action and through email marketing, which an easy way to collect customer can have a strong impact on information, and you can constantly customer retention. work towards increasing your conversion rates. Its also a great way to disperse new promotions to an audience Do you just have basic template who has already volunteered to pages, or worse listings, for your stay updated about news and franchisees, and are now happenings related to your reconsidering doing it the right franchise. way? Click on the link on the next page for a personal demo to see 4. Have a Homebase to Point how easy it is to make a change to Customers To having search engine optimised, lead converting, social media In todays fragmented social media integrated websites for your and Internet marketing arena, its franchisees. very easy to become completely disorganized and lose control of Or, if youre more of a do-it-yourself your lead conversion funnel not to guy or gal, click the big mention convoluting the experience Try it Free for potential customers looking to purchase your products or link and you can dive into a free services, or just learn more. trial.
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Modern Franchise Magazine | |33 IntelBuild Magazine 3
WARNING SIGNS WHEN BUYING A FRANCHISE

Buying into a franchise concept can be an attractive way for some people to become business owners. Ideally, a franchise company has a proven business model, saving new business owners the time, energy and money they would have to expend building concepts on their own. By Richard Wozniak
Because investing in a franchise is a life-changing event, every prospective franchisee should thoroughly investigate a franchise opportunity before signing any sort of franchise agreement. fact, spectacular or if there were, prospective will respond as in fact, a long line of potential franchisees. Just make sure that Franchisees. the franchisor keeps his word during this "courtship" period - if What's more likely in a pressure he doesn't, you'd be wise to not situation is that the franchise jump into marriage! opportunity is not that spectacular, their line is not that 4) What do existing and former While there are multiple long, and, conversely, they need franchisees have to say? websites and books floating your money in order to make around that outline the steps that their payroll. There's no better way to find out ought to be taken in the interests whether a franchisor has lived up of due diligence, you should take 2) Do the salesperson's to its promises and provided a minute to review the "red explanations not match up with leadership to its franchise flags" we've outlined below: what's in the Disclosure network than by conversing with Document? current and former franchisees. 1) Is the franchise salesperson putting on the pressure? Is the salesperson making Keep in mind that, while there promises and/or commitments are always those disgruntled One of the traits of a good above and beyond what's written franchisees that had unrealistic franchisor is that it wants to in the Disclosure Document? expectations to begin with, a make sure there is a mutually large number of complaints good fit before "closing the If so, you should have the among a set of franchisees sale." contract amended to include signals a definite red flag. those promises. Remember Should you find yourself being always get it in writing. 5) Is there a history of litigation? pressured into making a decision but feel like you haven't 3) Has the franchise Litigation is not, by definition, a been given adequate time to salesperson not followed bad thing - for instance, a good think everything through, don't through? franchisor is willing to litigate in sign an agreement. order to protect the brand in Sometimes franchisors lead question. Frankly, the franchisor wouldn't prospective franchisees through be hounding you like that if the a bunch of hoops so they can And there will always be a franchise opportunity were, in better predict how the contingent of disgruntled
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franchisees that will blame the franchisor for their own shortcomings. However, excessive litigation is certainly a sign of trouble; if this is the case, dig deeper. 6) Are you uncomfortable with the level of training and support provided by the franchisor? Consider the length and composition of the program (all lecture or some hands-on experience?), the subjects to be covered, and the qualifications of the training instructors. If you're not sure whether or not you'll learn what you need to know to operate the business, look into the issue.
Are you confident that the support outlined in the agreement can effectively assist you in managing your business? 7) Is the franchisor's financial stability questionable? You should have a franchisor's Disclosure Document reviewed by a professional. While most franchisors have the best of intentions when they promise support, what matters is that they are able to ultimately provide the support you need. 8) Is the franchisors marketing what they say it is?
If the franchisor cant or wont show you what ROI you can expect, and/or the feedback from existing franchisees isnt great then think again about this franchise opportunity. Some of the larger, more established chains have national advertising campaigns, whereas the smaller ones tend to advertise on a local level. Depending on what kind/size of business you choose, you may have to do most of the legwork i.e., solicit your own clients. If your concept requires sales skills that you don't have, reconsider choosing that concept - it may not be the right one for you! Without a strong targeted and measurable marketing plan a franchise opportunity is unlikely to be successful. There is an old saying in business everything isnt marketing - but marketing is everything.
Many franchisors control all the Current franchisees are a good marketing for the franchise source of information: group. When you investigate the franchise opportunity, ask for Did they learn enough via some examples of the training to operate franchisors marketing and get effectively? them to show you the return on this investment. Did they get needed help on an on-going basis from Ask some existing and former a qualified support staff? franchisees how successful the franchisors marketing is and if it targets the right customers
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WHY FRANCHISING IS STILL A GREAT WAY TO DO BUSINESS.

What seems to be overlooked recently with some of the negative publicity and state enquiries into the industry, is that franchising is still a great way to do business. By Geoff Hodges
There are countless benefits to becoming a franchisee, which is why Franchising is one of the strongest sectors of the Australian economy. If the franchise you are considering provides for all or most of the following then the chances are you will enjoy a successful franchise business: The franchisor provides comprehensive initial and onging training. The franchisee benefits from operating under the name and reputation (brand) of the franchisor, which is already well established, successful and positively perceived in the mind and eye of its market. The franchisee will usually need less capital than they would if they were setting up a business independently because the franchisor, through their pilot operations previous experience and buying power, will have eliminated unnecessary expense. The franchisor provides the advice and/or assistance in identifying suitable trading locations or operating territories for the franchisee. The franchisor is the expert. They know what areas or locations will be profitable and which arent. The franchisor helps the franchisee in lease negotiations, complying with planning laws, preparing store layouts, shopfitting and/or refurbishment, and provide general assistance in determining what the franchisee will require to launch the business. The franchisor trains the franchisee (and the franchisee's staff) on a regular basis in all areas of the business including; manufacture, preparation, accounting, business controls, marketing, promotion and merchandising. The franchisor may negotiate better rates of finance, or more favourable conditions, for franchisees with financial institutions. The franchisee receives the benefit on a national scale (if appropriate) of the franchisors advertising and promotional activities at a lower cost than if they were to attempt such marketing themselves.
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The franchisee is able to leverage the bulk purchasing power and negotiating capacity made available by the franchisor by reason of the size of the franchised network. Strongly question any franchise that does not provide cost advantages for franchisees. The franchisee has access to use of the franchisor's patents, trade marks, copyrights, trade secrets, and any secret processes or formulae. The franchisee has the benefit of the franchisor's continuous research and development programs, which are designed to improve the business and keep it up-to-date and competitive. The franchisor provides a knowledge base developed from their own experience, as well as that of all the franchisees
in the system, which would otherwise be impossible for a nonfranchised business to access. The franchisee has available to it the services of the field operational staff of the franchisor who are there to assist with any problems which may arise from time to time in the course of business. A franchisee can also speak to their franchisor and existing franchisees to discuss their business challenges or problems. Many franchise systems have advisory councils formed from high performing franchisees that are there to assist all franchisees and advise the franchisor of recommendations or improvements that will make the whole franchise system better for customers, franchisees and the franchisor alike.
The support and benefits provided by a Franchise system should greatly reduce a franchisee's business risks. What will make it an even better way to do business is provide franchisees with the necessary protection that many experienced industry participants are suggesting. Ethical franchisors (which are in the majority) have nothing to fear from these changes, in fact they will benefit from them. Their franchises will be more sought after and valuable. Franchisees will sleep safe in the knowledge that there is strong protection for their investment and significant repercussions for franchisors that dont comply with these changes. Do your due diligence, make sure you 100% happy with your decision and are fully committed to the business, the franchise and the franchisor....then enjoy the ride!
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ARE YOU A BUILDER LOOKING TO GET OFF THE TOOLS?

When you stop and think about it, as a builder you will use many types of coatings during the construction of even the most basic home.
Whether its the interior or exterior paints, renders, texture coatings, timber stains, decking oils, waterproofing membranes, sealants, primers, bonding agents, impact coats, concrete sealers, patterned concrete toppings and many more, you will most likely be dealing with multiple suppliers, different trades, different products and all the while diluting your buying power and costing valuable time scheduling and managing all these different companies and trades on site. How would it be if you could deal with one company that took care of all these coating procedures for you with one phone call! PowerCoat are the only company in Australia, that has the expertise and experience to successfully project manage all your coating requirements. We can even take care of wall system installation, full wet area waterproofing and seamless flooring applications regardless of the product or system specified, with very few exceptions. No matter whether you are a builder of homes, units, high-rise developments or industrial and infrastructure, PowerCoat will tailor a coatings solution to suit your business, preferred products and construction schedule. Franchise opportunities now available Australia wide.
40 | Modern Franchise Magazine 10 | Careers Magazine
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Modern Franchise Magazine | | 3 IntelBuild Magazine 41
FAIR WORK OMBUDSMAN LAUNCHES NATIONAL FRANCHISE PROGRAM

The Fair Work Ombudsman has launched a free tailored program, to assist franchisors interested in promoting fair and compliant workplaces in their franchise business. By David Marks
The newly launched National Franchise Program offers franchisors an opportunity to protect their brand by proactively working with the Fair Work Ombudsman to support fair and compliant workplaces across their franchise network. Participation in the National Franchise Program is both free and voluntary. The National Franchise Program offers participating franchisors: a tailored plan to support their business compliance with workplace laws a dedicated FWO Advisor who will work with the participating franchisor throughout the program and assist with enquiries practical guidance about how to promote and support compliance with workplace laws across the franchise business free tools and resources to educate franchisees about the Fair Work Act greater visibility of, and control over, workplace issues arising in their franchise business. Compliance with workplace laws is important to all franchise brands reputation. The National Franchise Program assists franchisors in promoting and supporting franchisee compliance across their business. The program offers franchisors an opportunity to participate in a program specially tailored to their business. While individual franchisees are not eligible for the program, they are encouraged to discuss the program with their franchisor. Franchisees who employ staff have the same workplace rights and responsibilities as other employers. This new website has information and advice, as well as templates and resources to help franchisees. Fair Work Ombudsman Advisors will help franchisors develop and implement programs to increase their franchisees understanding of, and compliance with, workplace laws with the program being tailored to best support their business. Failing to meet workplace responsibilities can have serious consequences for an employer. If that employer is part of a franchise, these consequences may be felt by the entire brand. As a franchisor, taking practical steps to assist franchisees to meet their responsibilities and minimise the risk to the franchise brand is a smart decision. Most franchise agreements impart a contractual responsibility upon the franchisee to comply with Workplace Laws As a franchisor, you can assist by: engaging appropriately qualified human resources and industrial relations personnel to train, update and assist franchisees arranging corporate memberships with an employer association, or special rates with a professional adviser. This may help franchisees access reliable and cost effective advice purchasing HR/IR systems or software to help your franchisees achieve consistent and compliant workplace practices. providing franchisees with information about their rights and obligations under the national workplace relations laws
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providing franchisees with The Fair Work Ombudsman templates that show them suggests Franchisors could what to do. You might share monitor compliance by: materials prepared for the conducting periodic audits of business by a qualified employee pay slips and advisor leave records to ensure helping franchisees franchisees are meeting calculate the right rates of their record-keeping pay. This may involve a obligations centralised time keeping and providing franchisees payroll system, sharing information and tools to current pay rates prepared conduct self-audits and for the business by a requiring franchisees to qualified advisor, or directing report back the results franchisees to the Fair Work assisting franchisees to Ombudsman online pay resolve workplace disputes tools. with employees Regularly monitoring by providing an anonymous franchisors that that franchisees enquiry or complaint service are complying with the national for employees, so they can workplace relations laws will mean feel comfortable about they are better placed to see and raising concerns about their address issues before they employment become a problem. requiring franchisees to Before implementing new monitoring activities, franchisors should check what their franchise agreement or business structure allows them to do and adhere to any applicable privacy obligations. Fair Work Ombudsman Nicholas Wilson said the program would be worthwhile for franchisors who wanted to improve their brand because they would be publicly supporting workplaces where workers' rights were seen to be valued. notify the franchisor of employee complaints and /or Fair Work Ombudsman investigations or audits encouraging franchisees to understand and actively cooperate with Fair Work Ombudsman investigations or audits.
Fair Work Ombudsman also suggests franchisors can promote and support co-workplaces in their franchise business by keeping franchisees regularly updated about their obligations under the national workplace relations laws and how they can get help negotiating an enterprise agreement for your franchise business. This can create clarity and consistency about conditions of employment across the business ensuring your franchise agreement contains terms requiring franchisees to comply with the national workplace relations laws checking that your franchises business modelling takes into account the costs of lawfully employing adequate numbers of staff. With larger franchise systems more likely to have well developed systems in place to manage workplace issues and strong agreements that cover franchisees responsibilities the success of the program will ultimately be determined by the level of interest and engagement from franchisors. Registrations for the free program close February 29. For more details phone 13 13 94
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WHY YOUR EMPLOYMENT BRAND IS SO IMPORTANT

Increasingly, a company's employment brand is playing a vital role in the ability of employers to secure quality candidates in a talent short employment market. By Kristin McNicol
Just as big consumer brands and Develop a realistic level of franchises strive to create an expectation with emotional link between the employees consumer and their product to Ensure employees are influence purchase choice, aligned to the culture of employers competing for talent are the company finding they must do the same by articulating compelling reasons Embrace the employment brand why their organisation is a great internally place to work. The next step is to make sure the employment brand and the EVP is Employment value proposition reflected in every element of the The first step in developing a company's operations. For this to company's employment brand is occur successfully the developing the company's employment brand must be employment value proposition embraced by senior management (EVP). The EVP is a statement (or and business owners. By taking set of statements) which define ownership, senior management is the essence of the employment signalling the importance of the experience at the company. brand to all employees. Developing the EVP involves taking an honest look at a company from both an internal and external perspective and distilling the positive areas. In many cases it is best to have this evaluation process completed by an independent external group so the findings are not tainted or skewed and the maximum transparency is achieved. Franchisees play a particularly important role in maintaining the employment brand as they are the front line employers most staff, customers and suppliers deal with on a daily basis. For franchises, differentiating their business from its competitors and articulating the reason why their franchise is a great place to work is one of the major keys to success. For many franchises developing of employment brand has been a powerful tool in achieving this and ensuring they are able to attract and secure the best candidates.
Tips for identifying, developing Employment brand management and presenting your organisation's employment is often integrated with internal marketing (IM), and strives to build brand Understand every organisation stronger links between the already has an employment brand; employee brand experience and the objective is to find out what it is customer brand experience. that sets your business apart If a new employee is recruited and Examine your business their employment experience is from both an internal and different to that which was external perspective to promised, there is a high distil your organisation's possibility that the employee will EVP Having an EVP will provide rapidly become disengaged. This Get external help to get an employers with a deeper can easily be reflected on how impartial view on your understanding of the company, staff deal with customers. EVP enabling them to: Therefore, it is vital that everyone Once the employment Present the employment involved in the recruitment brand has been relationship in the best process firstly understands the developed, make sure it is possible light (ie. whats in companys EVP and secondly, reflected in every element it for the employee and they are able to articulate it and of the employee what is expected in return) deliver on it. experience
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INTRODUCING A DIFFERENT KIND OF RECRUITMENT SERVICE

Maxiom Jobs is built on our network of digital publications with over 300,000 business leaders and talented professionals subscribing across a wide range of industries and sectors, you can now reach a greater pool of active and passive job seekers.
The Opportunity Utilising this network of subscribers, along with traditional talent search channels, we help you identify the best talent that fits your organisations culture, business goals and vision. Maxioms specialist recruitment marketing team advertise your position on the Maxiom Jobs web site, as well as on the publication web site(s) that best match your vacancy, industry and the role. In some cases, you will also have the opportunity to post your job on the web site of our association or corporate partners and affiliates. A candidate attraction campaign is also launched via social media (including LinkedIn). A comprehensive candidate search is also undertaken within the Maxiom subscriber base. We dont charge commissions or placement fees, there are no monthly charges or contracts to tie you in. You simply purchase a Job Pack that reflects your recruitment needs. There are no extra costs! The Process Candidates apply via the Maxiom Jobs web site. Rather than just have them forward resumes, we ask them to complete an online application developed in conjunction with you that is tailored to reflect the qualities required to succeed in each individual role and that match your business goals. This includes a first round interview questionnaire. This enables you to more easily and evenly compare candidates and candidates can see that there is a level playing field and that their application will get seen by the person who countsYOU! They also know exactly what the role entails and what qualifications are needed before they apply, saving you valuable time. Applications are forwarded to both your inbox and to a Maxiom Jobs Client Services Manager. Depending on the Job Pack purchased and level of support required, Your Client Services Manager then walks you through the process of short-listing, interviewing and selecting the best candidate(s). The Ultimate Recruitment Back Office! Our screening process ensures you get the candidates whose unique ability match those required to be successful in the specific role and in your organisation. You can employ as many of the candidates as you like without any additional cost. As a strategic marketing specialist, publishing and advertising business, we also understand what it takes to make a business successful and how we can best pitch the job to people in your market. As a successful digital publisher we have a professional copywriting and design team who specialise in creating advertisements to grab potential applicants attention. We also have a specialist recruitment team with experience in over 22 industries and sectors. Maxiom Jobs gives you a structured and innovative recruitment marketing campaign designed to attract the best applicants to your team. Most importantly, you retain complete control over the whole process.
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Modern Franchise Magazine | 47 IntelBuild Magazine | 3
5 WAYS TO FIND OUT IF A FRANCHISE BUSINESS MAY BE RIGHT FOR YOU

Are you the right kind of person to start up a franchise opportunity? Look at our 5 hints below to see how you measure up:
By Jane Hudson 1. Do you like the idea of operating a proven business? meticulously as possible so that it can be successful. If, however, you prefer to adopt the lead position, invent some of your own concepts and others have a If the answer is positive then a tendency to follow your lead, you franchise opportunity is simply that... a business idea which has may find a franchise opportunity cramps your entrepreneurial been proven and found to be spirit. effective. Quite simply, you benefit from somebody else's 3. Are you willing to learn? time and effort in trying and testing out a viable business A key component of success in structure. Should the reply be any business is learning. that you simply enjoy the Regardless of whether you run challenge of taking a your own stand-alone business commercial idea of your own design and testing it for yourself, or a franchise operation, then a franchise may not be what learning will be a key factor in the level of your success. All top you're seeking. performing entrepreneurs spend a good deal of their time 2. Are you a Leader or learning. So do top performing perhaps a Follower? franchisees. Those who arent prepared to invest in learning & If you tend to be a follower and you are happy to go along with development for themselves and their staff end up the bottom other peoples ideas, then a franchise opportunity could well performers in any business or be suitable for you. Franchising industry, franchising is no exception. A central part of requires implementers not entrepreneurs! One of the most adhering to a successful formula is to learn the systems; getting crucial aspects of a franchise educated on the processes and business is that the franchise business procedures which will system is followed as help you operate the franchise effectively. 48 | Modern Franchise Magazine Fortunately, the majority of franchisors provide training as an integral part of the franchise package. Regularly reading business books, or book summaries, and franchisor training material is a good place to start. If you're keen to master new methods and business processes, even though they might go against how you might have done comparable duties before, then you could potentially find a franchise business suitable. If youre not, then forget about going into any business! 4. Do you think you're willing to work hard? This is certainly an issue that could apply to any business endeavour regardless of whether its a franchise or standalone business. Do not be fooled into thinking that a tried and tested system guarantees that it'll be successful regardless of whether you work hard or not.
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Lazy business owners quickly become low performing business owners. Most go broke. Working hard, constantly learning new things and maintaining your self belief are the keys to business success. The important thing here is not really the work itself, but understanding that operating your own venture could involve a good deal more time and effort than simply doing a regular job where you arrive at 8.30am and leave at 5.30pm. Not surprisingly you will discover different types of franchise which will control the kind of work you'll do. A professional or white collar business opportunity, for example, might involve longer hours working from your desk, where as a van based business could indicate you are out visiting clients a lot or working more using your hands. Particularly in the early stages, you might find yourself working longer and harder to be successful. But you will have the satisfaction and of building up your own business and a saleable asset.
5. Do you have access to spare capital to invest in starting up a business?
If your answers were generally positive then a it is likely that you will find running a franchise an enjoyable and successful experience. If they were negative Every business carries risk, then you might find it franchises included. Every business needs some capital in challenging. order to get off the ground. Franchises vary in establishment It is important to be honest with cost from a few thousand dollars yourself when looking at any business opportunity. Just to $1 million +. because it work for one person doesnt mean it will for you. You will also need working capital to fund cash flow. You There are many types of people have to decide how much you that are successful in business are prepared to risk? and franchising, so ensure you investigate what makes the How much can you afford to existing franchisees successful spend? in any franchise you are How much finance can you get considering. and will the cost of servicing this still leave enough profit for wages and a reasonable return on your investment?
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LESSONS FROM RECENT FRANCHISE FAILURES, LAWSUITS & BANKRUPTCIES

2011 saw a number of franchises fail, star franchisees end up in bankruptcy, litigation against rogue franchisees and more pressure from franchisee groups to amend the franchise code to include a good faith clause. So what are the lessons from 2011 that can help the franchise sector in 2012? By Naomi Walshe
Franchising is a great way of getting into and growing a business. But like any business or investment it has its risks, particularly as there are many owners in a franchise network. There have been some well publicised cases in 2011 where franchisees and master franchisees decided to leave a franchise and start up their own competitive business. Obviously the former franchisors of these rogue franchisees werent too thrilled with this so they commenced legal action. Generally it ends badly for the franchisee. There have been a number of franchises effected such as Cold Rock Ice Cream and Essential Beauty. The lesson here is simple. When you invest in a franchise you dont buy the system to use whenever and wherever you like. It is never yours to own so dont try and steal it. It never works out in your favourNever! On the franchisor side we had some well publicised failures 50 | Modern Franchise Magazine and the odd scam such as SensaSlim. It was good to see the the Franchise Council of Australia grant SensaSlim membership too. Good on them. Maybe they were the only ones who got paid! Brands insolvency has had its critics.
An important lesson to emerge from Heal's bankruptcy is that he clearly didnt do adequate due diligence on Allied Brands and made a hefty investment in a High profile franchise failures failing franchise. Heal was a such as RedGroup Retail (Angus multiple-unit franchisee, he was & Robertson. And Borders), also a multiple-brand franchisee. Allied Brands (Baskin & Robbins Australian franchise - well At one point he owned up to 30 technically that was in late 2010 outlets concurrently across but its relevant as youll see several different brands including later) & Refund Home Loans. Baskin Robbins, Eagle Boys, Zarraffa's Coffee, Subway, and Then high profile franchisee Noodle Box, and employed Shane Heals bankruptcy hit the around 300 staff. media in late 2011. This is a story that still has more to be In Australia, multi-unit franchising told. is only just becoming a more widely used model to expand Peter Dinoris of Vincents franchise networks, so many Chartered Accountants who franchisors are still developing handled the Allied Brands the support systems and insolvency has been appointed business models required to as Heal's bankruptcy trustee too! assist multi-unit franchisees successfully manage their There are significant questions operations. Multiple-brand still unanswered in regards to the ownership is even less common whole Allied Brands saga and in Australia. While the brands Vincents handling of Allied were all in the broader food
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category, operations similarities There have been some very well and synergies between brands publicised failures recently may not have existed. including the aforementioned Angus & Robertson, Refund etc. Heal also acquired the franchise rights to food group Urban The success of franchising has Burger where he was preparing been driven by franchises having to transition from franchisee to robust systems and procedures franchisor by selling most of his in place to ensure that every unit 12 remaining franchise outlets in the business performs to a across a variety of brands. His high standard to meet bankruptcy may also have customers expectations and to ramifications for Urban Burger's meet the profitability future. expectations of investors (franchisees). Sometimes, Another lesson is that just however, these business models because you are dealing with need to be flexible enough to someone who is household stay ahead of an ever changing name doesnt mean that your market and more demanding business will thrive, or even customers. Franchises that are survive. not flexible, modern as well as maintaining sound business Wayne Ormonds Refund Home systems and practices will Loans is another example. inevitably fail. Ormond and Refund have received quite a bit of adverse So, when looking at buying a press after Refund entered into franchise, how can you tell if your administration late in 2011. potential franchisor is up to the No matter what business you are looking into, do your homework. A strong or well known name is no guarantee of success. Kodak for instance. Some franchises have failed due to the inflexible nature of their business model, systems and practices in a changing business environment. task? This isnt always easy. Checking the history of the franchise with exiting and former franchisees is a start. Googling the franchise can bring up some very interesting results. Sometimes these sites are just disgruntled former franchisees venting their frustrations but others are relevant and shouldnt be dismissed.
Never let emotions dictate your decision on which franchise to buy. Another lesson is to check out the status of the relationship between your potential franchisor and their licensee or major suppliers. In Allied Brands case Baskin & Robbins terminated their agreement with Allied. This wasnt a sudden or unexpected move. In Refund Home Loans case, Bankwest pulled out of its arrangement with Refund and in case youd forgotten, the demise of Traveland was in turn partly caused by the failure of Ansett. Also check the ACCC website, Refund and Ormond had already had a run-in with the ACCC in 2009 and in early 2010 the Federal Court issued orders by consent declaring that Refund and Ormond had contravened the Trade Practices Act by misleading franchisees. Businesses of all types, models and structures face risks. The key lesson here is to reduce those risks by making sure you do your homework before you enter into any agreement and when you do find that right franchise, be true in your dealings with all stakeholders. Modern Franchise Magazine | 51
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TRAINING YOUR STAFF WITH CLARIFY TRAINING

Wouldnt it be great if all your staff had the same passion and vision for your business and you? Clarify Training can help you create a dynamic culture where your staff thrive enabling you to reach your business goals faster.
Our organisation has a deep commitment to you and your people and offers a unique service based on the values of Accountability, Respect and High Performance.
Our professional services are tailored to be tightly aligned to the commercial aims of your business: In line with your organizations strategy, we will formulate, lead and implement a learning framework that is linked to business performance, maximise individual capability and builds leadership competence. Coach business leaders in your organization so as to ensure the optimal delivery of all tactical people programs and to ensure business results are achieved. As accomplished practitioners your business to ensure business they can help your people display results are achieved. effective influencing skills, the Attract & Recruit the Best ability to inspire and engage others Talent and the capability to lead and Provide an Environment empower change in a for Your Talent to Thrive performance driven setting. Optimise Individual Capacity With extensive experience in Build Influencing Skills and helping organizations analyze their Leadership Capacity needs and design strategic Ensure Business Results learning and development Are Achieved solutions, our highly qualified See the Results in Your consultants will work closely with Bottom Line you to determine your companys individual requirements. We can design tailored solutions for individual employees, project teams, departments and entire companies. If you want to optimise your business, give Clarify Training a call.
We will help you implement a suite We can also help you develop a of HR practices and policies to learning culture, while fitting in with reflect contemporary, consistent the overall strategic goals of your best practice. organization. Our consultants are individuals Our programs are strategically who have carved their careers within leading, complex business aligned to the commercial aims of environments.
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SALES & MARKETING SKILLS YOU WILL NEED AS A FRANCHISEE

When starting a new franchise operation, there are many things a franchisee needs to organise attend to and manage, and thats before you even open the doors. While all the pre-opening issues are important, possibly none is more important than having a firm and well prepared sales & marketing plan.
By Aiden Williams
Its About Relationships Put simply, selling and marketing is nothing more than the creation of a new relationship. It involves marketing to bring in qualified leads to your business and reduce the time and cost of sales; and sales which is the conversion of those leads into paying customers. Different business types will require different sales and marketing skills. Professional service franchises require a different approach than fast food or retail, for instance. Whether you do business from a shop front, an office, if youre mobile or work from home all dictate what sales and marketing techniques you will need to use. Restaurants need to attract customers using a different approach than health care or trades services. 54 | Modern Franchise Magazine
Still, what all businesses, franchised or not, have in common is the need to bring in customers. But not only bring them in, keep them coming in, spending more, and bringing more people with them. Sales and Marketing are learnable skills. To some franchisees it comes naturally, while others break out in a cold sweat, just at the thought. Franchisees join a franchise system because they have a firm belief in the product or service, but few have a strong background in sales and marketing. Sales and marketing skills are the very skills they need to sell themselves and their services. Sales and marketing skills are the skills they need to keep the business alive.
24/7 & More Marketing is not just advertising and sales is not just closing the deal. It's more like the air you breathe, all-pervasive, present all day and every day - in every transaction, and thanks to the Internet, email and social media it has become a 24-hour activity, working even when your franchise business is closed. This is also where your franchisors assistance is invaluable. While Head Office cant do it all for you, their advice, support and experience will help you in the areas that you are weakest. If you are unsure about anything ask for advice.
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Defining the Purpose Successful marketing begins before you open your business.
Multi-Faceted
Nothing to Fear Many new franchisees are also uncomfortable with the notion of selling their concept to others. It's scary enough being the new owner of a business without having to approach prospective customers and sell them on the business too - especially when the business is their own, because then the rejection feels more personal. Though remember, there should be no fear in sales and marketing, because creating a new relationship is something that we already know how to do!
It is important to understand that effective marketing involves not only advertising, promotions, 1) Be sure you know exactly email marketing, direct mail, and who you're selling to, what it the usual methods of reaching is you're selling, and what out to potential customers to problems you solve for your distinguish your business from target markets. the competition, but also training your employees to market in 2) Redefine the word "selling" every transaction, the use of so that it is comfortable for social media and mobile you and for your customers. marketing strategies, and active involvement in your community. Your franchisor will help you with pre-opening and grand opening Technology is continually being developed that helps you make or launch promotions and activities, as well as training in contact and stay in contact with how to continue marketing after more people. the initial euphoria fades. This technology can also assist Make sure you utilise all your franchisors marketing tools, support and draw on their experience. Your fellow franchisees are another source to draw from. The more you succeed, the better it is for them, as the brand achieves greater market penetration, recognition and trust.
you in reaching more of the people or businesses that are likely to want to buy your products or services. Before you can begin selling, you will need to develop relationship with your market, build trust and value. The benefit of joining a franchise is that your franchisor has already built a reputation which hopefully means that your target market is already familiar with your business, and percieves its value and trusts your brand.
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NEW BUILDER PARTNER PROGRAM

Builder Partner Program We are seeking quality registered builders to build our designer homes in your region. Design & Marketing The opportunity to become part of an innovative market leading home builder has arrived. Micheal Polo Designer Homes Your Local Builder gives you an opportunity, at a low cost, to develop your own business, backed by a comprehensive design and marketing structure and professional company culture. Responding to the building markets need for designer homes at an affordable price, we have developed a unique business structure that enables regional building partners, across Australia access to our unique designer homes and design services, building group buying rates, and our strong marketing and lead generation service. With over 30 current design plans, with new plans coming online regularly, and a strong web presence, you can be sure of strong business growth in your unique region. By joining Micheal Polo Designer Homes, you can take on the big guys with strong marketing campaigns and access to national buying rates as well as access to a community of like minded local builders and industry professionals. How does it work? We know and understand what good small builders do best, build good homes. Time is often lost on the small things. Time that could be better spent driving your core business, building homes. Micheal Polo Designer Homes offers a sales, marketing, design and estimating service that will ensure enough genuine opportunity to build a good profitable business within your own region. Intensive initial training program and ongoing professional development Local state office assistance for the franchise lifetime Professional Marketing & Sales Estimating service
National Purchasing Many builders feel that they have agreements and trade to do everything within their own sharing business, often spreading themsleves thinly and working To find out more, simply click the many extra hours, just to get link below and fill in the become things done. a Micheal Polo Designer Homes Builder enquiry form. Being part of the Micheal Polo Designer Homes team means having support structures in www.michealpolohomes.com place so that your time is best used doing what you do best and freeing up your time to spend with your family and friends and more time doing the things that you want to be doing. Michael Polo Homes
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Modern Franchise Magazine | 57 IntelBuild Magazine | 3
UNDERSTAND WHY PEOPLE BUY FRANCHISES AND YOU'LL ATTRACT MORE FRANCHISEES
Want to know why your advertising isn't producing the way you want it to?
By John P. Hayes Ph.D
It's because you're appealing to the wrong motivators. Or not enough motivators. Buying motivators are the same whether you're a franchisor advertising for franchisees, or you're a franchisee advertising for customers. Appeal to the wrong motivators and you're advertising will be less effective. Emotion is the first buying motivator People buy emotionally first; logically second. Here's how that works. They're attracted to a luxury automobile for all the emotional reasons: Pride. Status. Differentiation. But when they're asked, "Why did you buy that (name a luxury automobile)" they'll answer logically: "Got a great deal," "It's the best performance," "Consumers Reports says it's the safest," etc. That's how they justify the purchase. They're selling the need (logic), but There's nothing wrong with any of the prospects are buying the want these messages, except they may (emotion). not produce the results desired. How many ads motivate action? As an example, visit any one of the portals that promote franchise opportunities. Read the advertising messages. Here are several: Recession Proof Business Low Overhead, Large ROI No royalties No experience necessary The ultimate franchise opportunity The franchise profit leader Rated #1 Hot" Greatest franchise campaign, maybe ever One of the best franchise advertising campaigns ever ran in the early 1990s. It said: "Golden Parachutes Land Here!" It's a great message because it combines both emotion and logic! You can see the parachute landing while also justifying that it's landing in the right spot!
Most ad campaigns by franchisors and franchisees (and businesses in general) emphasize emotion or logic; it's the rare campaign that hits both motivators There's a mixture of emotion and simultaneously. And for the best logic in those messages, but after results, you need to hit both if you a while, they all look alike, don't want your advertising to produce they? Nothing stands out. You can the best results. pretty much use all of them to describe most franchise John P. Hayes, Ph.D., author and opportunities. Furthermore, some speaker, advises franchisees, of the messages don't appeal to It's just human nature franchisors and those who want to emotion or logic! Consequently, Come on now, you know it's true. franchise their business. You'll find We all do it. It's human nature! We they don't promote the reader to more of John's articles at take action. How many people do FranchiseMastermind.com. buy because we want it. you think are fooled today by "no royalties"? Are buyers really John is a 30-year franchise Then we justify why we need it. interested in "the franchise profit veteran who has owned franchises Often times, franchisors and and was the CEO of a major franchisees are hitting the wrong leader"? Do buyers care that the business is "rated #1"? franchise company. motivators with their advertising.
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TAKING OVER AN EXISTING FRANCHISE

Do you want to become part of a well-known franchise family but hesitate because of the legwork involved in launching the new franchise location?
By David Morgan Maybe you should consider taking over a franchise that's already in existence. Take a look at the advantages involved in the transaction: You'll be up and running right away. When you take over a franchise, it's already in operation - which means that you don't have to go out and search for real estate to purchase. Additionally, in the case of transferal, the current staff of the franchise will stay on, meaning that you don't have to conduct interviews and hire new employees. Furthermore, you'll have a well-established customer base and solid venues. The result of all of this? As a prospective franchisee for an existing concept, you have complete access to the business's monetary records and earnings history - take advantage of this. Do the numbers look solid? Go for it. Are the earnings questionable? Don't be afraid to walk away. You'll avoid paying certain fees. Closely inspect the franchise agreement for the company you're looking into. You may be entering into the existing franchise agreement, rather than a new one, which could be a great advantage to you. For example, the fees paid to the franchisor in the existing agreement might be lower than those that a new franchisee would be required to pay. Take a look at relevant location demographics - are they shifting in a way that could negatively affect your business? Consider market trends and predictions. The exiting franchisee has the primary say regarding the actual purchase price for the existing franchise. While you may have some say in this matter, the exiting franchisee has the final word. Be aware that the vast majority of franchise agreements give the franchisor right of first refusal when an existing franchise is up for sale - that is, the franchisor has the legal right to purchase the franchise before it can be offered to you. To your advantage, there is usually a window of time during which franchisors can make this decision; find out how long this window generally stays open. Usually the franchisor will require you to prove you are a suitable franchisee -that you meet their normal franchise selection criteria before agreeing to the transfer.
You'll be able to start conducting When considering purchasing a business right away. concept, remember to do the following: You'll have a good grasp of historic profitability. Figure out why the original franchisee is leaving the However, you shouldn't just business. purchase any old existing franchise; one primary reason that existing franchises are sold They may be selling due to poor relations with the franchisor is that the franchisee bails because the business's financial which would affect you as well. figures aren't what the franchisee expected them to be when coming in. 60 | Modern Franchise Magazine
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About Modern Franchise Magazine

Publisher Maxiom Group Pty Ltd 2/710 Collins Street Docklands Vic 3008 Australia www.maxiom.com.au Editor Mark Matthews Digital Magazine Created By Modern Franchise Magazine Online www.modernfranchisemagazine.com Advertising Enquiries 1300 855 696 (within Australia) + 613 9097 1606 (International) modernfranchise@maxiom.com.au Editorial, Media Releases & Article Submission magazine@maxiom.com.au
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Modern Franchise Magazine February - 2012

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Modern Franchise Magazine February - 2012

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Whats in this months Magazine?

The Modern Franchise

4 | Modern Franchise Magazine

Subscribe for Free.

Modern Franchise Magazine | 5

WHAT DO THE MOST SUCCESSFUL FRANCHISEES HAVE IN COMMON?

6 | Modern Franchise Magazine

THE MUST READ MAGAZINE

MODERN BUSINESS MAGAZINE

Modern Franchise Magazine | 7

1. So What is Maxiom Jobs exactly?

Maxiom Jobs offers employers access to many of these top

8 | Modern Franchise Magazine

24 | Modern Franchise Magazine maxiom

Modern Franchise Magazine | 9

GETTING YOUR BUSINESS READY TO FRANCHISE

Custom Publishing for Business, Associations & Not For Profits

For More information Click Here or phone us on 1300 855 696

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Modern Franchise Magazine | 13

DOES THE FRANCHISE SECTOR NEED AN OVERHAUL?

Modern Franchise Magazine | 15

RECRUITING FROM WITHIN MULTI-UNIT FRANCHISING

16 | Modern Franchise Magazine

ARE YOU CONFUSED? - THE NEW NATIONAL WHS (OH&S) STANDARDS

18 | Modern Franchise Magazine

SPECIALISTS IN WHS MANAGEMENT AND TRAINING

Modern Franchise Magazine | 19

FRANCHISING GROWTH IN 2012 - THIS TIME IS DIFFERENT?

Modern Franchise Magazine | 21

22 | Modern Franchise Magazine

Modern Franchise Magazine | 23

THE ALL-IMPORTANT FEATURES TOP FRANCHISES POSSESS

VoIP Phone Systems

100% Satisfaction Guarantee

Modern Franchise Magazine | 25

WANT TO FIND THE BEST EMPLOYEES FOR YOUR FRANCHISE?

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Modern Franchise Magazine | 27

6. What challenges did you face in setting up your franchise?

Modern Franchise Magazine | 29 maxiom

5 WAYS TO MOTIVATE YOUR FRANCHISE EMPLOYEES

PROJECT MANAGEMENT SOFTWARE

Wrike gives you the full insight into your business

Take a tour before your 15 day free trail

Take a tour before your 15 day free trail

THE 5 SECRETS TO EFFECTIVE FRANCHISE WEBSITES

32 | Modern Franchise Magazine

the best platform to create + manage

local websites for your franchisees

Preserve Your Brand Online

What's included with Empowerkit?

WARNING SIGNS WHEN BUYING A FRANCHISE

34 | Modern Franchise Magazine

Modern Franchise Magazine | 35

36 | Modern Franchise Magazine

The Corporate Gift Experts!

Ph: 1300 522 611 maxiom

PREMIER CORPORATE REWARDS

Modern Franchise Magazine | 37

WHY FRANCHISING IS STILL A GREAT WAY TO DO BUSINESS.

38 | Modern Franchise Magazine