The British Franchise Association is moving

The British Franchise Association is moving premises on 13th July to:

British Franchise Association

Centurion Court

85f Milton Park

Abingdon

OX14 4RY

The offices will close the week commencing Monday 12th July and re-open on Monday 19th July.

BFA plans suppliers’ affinity scheme for franchisees

An ambitious affinity scheme providing supplier discounts to franchisees of its 289 franchisor members is being planned by the British Franchise Association, the industry’s trade body and self-regulatory authority. 

The plan is for the BFA to negotiate cost-saving contracts with firms providing such services and products as credit cards, swipe terminals, mobile phone services, software, and similar services.
 
The scheme, part of the BFA’s One Vision development plan, calls for the setting up of a national franchisee register of its members’ franchisees. Each franchisee would pay a weekly subscription (likely to be between £1 and £2) which, if all joined, would bring in extra annual income of almost £1m at the £1 rate and £1.9m at the £2 rate.

Further income could come direct from the participating suppliers through commission on sales and over-riding discounts when overall targets are met.

The scale of the total income has the potential to transform the fortunes of the association by more than doubling its annual income.

The scheme’s early development will be funded from the BFA’s substantial reserves. Break-even is expected within three years.

The initial hurdle to be overcome is the creation of the continually updated national franchisee register. Franchise contracts typically include confidentiality clauses that prohibit the franchisor from revealing details of its franchisees. This prohibition needs to be lifted to enable franchisors to supply the BFA with the details it needs for its register.

Some progress on this issue was made back in March, 2007 when new members were requested to include in their contracts a clause permitting them to give details of their franchisees to the BFA. Existing members were also then required to add the clause to their contracts when they come up for renewal.

In cases in which this permissive clause has not yet been embedded in their contracts franchisors will need to get permission from their franchisees to waive this aspect of the confidentiality clause.

Furthermore, the BFA will need agreement from their franchisors to promote its affinity scheme direct to their franchisees.

Other major concerns are that the scheme risks trespassing on the franchisor’s traditional role in negotiating deals with preferred suppliers for the benefit of their franchisees. The BFA will, therefore, need to be careful to avoid treading on its members’ toes and upsetting buying arrangements that are already in place.

For example, the BFA scheme might beat the price for a mobile phone contract that the franchisor may have already “sold” to its franchisees. Also, such a deal might not sit well with a mobile phone supplier who is a member of the association.

Participating suppliers may require copies of the register to promote their offers directly to franchisees. This could give rise to a security issue as the register’s contents could find their way onto the computer systems of suppliers. The register would be of unique value to any firms or organisations which might want access to such a list for reasons which might prove detrimental to franchisors and the BFA.

Another concern of franchisors is that in the unlikely event that the scheme became mandatory they might find themselves having to pay their franchisees subscriptions if the latter were less than enthusastic about the benefits.

An encouraging sign, however, is that the BFA’s board has already unanimously agreed to require all members to keep the franchisee register up-to-date with details of their franchisees. The board’s members include such leading systems as McDonald’s Restaurants, Molly Maid, Chemex and Signs Express.

Other services the BFA is planning for franchisees are multi-brand local sales groups (local franchise networks), a news and information service, and e-training modules on such subjects as customer service, selling professional services, finance for non-financial managers, and credit control of business customers. Here again the association will need to avoid topics on which franchisors prefer to provide their own tailored training. The register will provide the means to promote these services directly to franchisees.

The scheme would operate through a website which would include a chat room. This would be moderated by the BFA to avoid it being used by aggrieved franchisees in dispute with their franchisors.

Members will have the opportunity to discuss the feasibility and structure of the scheme at their annual conference at the East Midlands Conference Centre, Nottingham, on June 2 and 3. They have been urged to attend by their chairman, Mike Goddard (Belvoir Lettings), who is leading the One Vision project.

WPA offers special inter-franchise trading scheme

WPA, the medical insurance firm, is the latest franchisor to offer an exclusive inter-franchise trading scheme to the industry.

Under an affinity scheme, which will be operated by WPA’s franchisees, the insurer will offer discounted rates on its healthcare policies to franchisors and through them to their franchisees. The scheme will also be available to service providers to the sector, such as lawyers and franchise consultants.
 

The first to take up the offer has been John Pratt, head of Hamilton Pratt, the Midlands franchise legal firm, who is the legal adviser to the BFA.

“The WPA franchisee who visited my practice was extremely knowledgeable and helpful,” he commented. “Fantastic customer service is at the top of their agenda. Their premiums are highly attractive.”
 

Berkeley Harris, head of WPA’s national franchise team, launched the scheme at the recent Franchise Supplier Showcase exhibition and conference.
 

“As a leading private medical insurer and a leading franchisor, we hope that the franchising community will give us the opportunity to not only protect their own and their franchisees’ businesses, but also the health of all their loved ones.”
 

Brian Duckett, head of the Franchising Centre and a director of the Franchise Supplier Showcase, commented: “This is just what the showcase is all about - enthusiastic suppliers presenting innovative business solutions to a gathering of decision-makers from franchisor organisations. The fact that WPA are themselves  a franchisor is even more exciting.
 

“How many more franchisors could use the showcase to promote what their franchisees can do to help the rest of the franchising community, thus growing business for everyone?”
 

WPA, whose history goes back more than 100 years, has 300,000 customers. It has a staff of 200 at its head office at Taunton and a national network of 100 franchisees. Details from www.wpa.org.uk/franhealth and 0800 915 0052.

Election gives franchising a voice in Parliament

Franchising will have a powerful voice in Parliament with the election of Mel Stride as the Conservative MP for the new constituency of Central Devon.

Stride polled 27,737 to gain 51.5 per cent of the vote and defeat Liberal Democrat Philip Hutty by 9,230. Moira Macdonald (Labour) was in third place on 3,715.
 
Stride is the founder and owner of Venture Marketing Group, which runs the annual series of National Franchise Exhibitions, sponsored by the BFA, and a string of graduate recruitment shows.
 
He is the first MP to have been in the franchise business and as such will be in the position to speak authoritatively at first hand of the benefits of the system to Britain’s economy in creating new businesses, jobs and wealth.

He will also be able to protect the industry in the House from the imposition of any legislation that might threaten to impede its growth.

Finalists announced for UK franchisor awards

A shortlist of 15 franchisors has been drawn up for the prestigious BFA HSBC Franchisor of the Year Awards 2010, supported by Express Newspapers. The judging panel sifted through many inspirational stories of achievement for three national awards recognising overall excellence, franchisee support and brand building.

The 15 finalists will now meet the panel face-to-face to compete for accolades which crown them both as best in the industry and which will provide welcome opportunities to motivate staff and franchisees. The awards will recognise their hard work at a time when British businesses have had to be more innovative than ever before to compete in today’s economic climate. 

Franchisors shortlisted are:
Franchisor of the Year Award

• Auditel
• Autosmart
• Bluebird Care
• Domino’s Pizza
• Driver Hire
• McDonald’s
• TaxAssist Accountants
• Wiltshire Farm Food

Franchisee Support Award

• Countrywide Grounds Maintenance
• Monkey Music
• Revive!
• X-Press Legal Services

Brand Builder

• Cook
• LighterLife
• Smallprint

The winners will then be announced at the 21st British Franchisor Awards gala dinner on 2 June.
 
Cathryn Hayes, pictured, Head of Franchising, HSBC, said: “We know from working with many companies over the past year that all areas of business have been affected by the recent downturn, requiring tailored support and advice. However, it’s extremely heartwarming to see so many innovative management tactics amongst franchisors which made choosing the finalists extremely challenging.
 
“We’re looking forward to the next stage of hearing from the people behind the businesses to learn more about how they’ve succeeded and in many cases, grown. The HSBC Franchisee Support Award celebrates the franchisors that have put solid structures in place to ensure their franchisees have the best possible chance of success.”
 
Kieron Summerhayes, Deputy Group Advertising Controller, Express Newspapers, said: “The calibre of franchisors in the UK who have successfully maintained and built their brand is evidently outstanding as it was tough to conclude the shortlist. We’re looking forward to going one step further by awarding the most innovative and inspiring franchisors at the gala dinner in June.”
 
Brian Smart, BFA Director General, said: “The number of outstanding nominations we’ve received has been very impressive, especially given the economic backdrop in which they have been operating. Gaining the right support through these tough times is essential however it is also important for businesses to demonstrate the great work they are doing through awards such as the BFA HSBC Franchisor of the Year Award. It can provide the platform for businesses to truly shine and demonstrate that they are leading the way in franchising best practice and are the industry’s widest recognised.

“Now that Britain is gaining a strong footing once again, it’s important to inspire the next generation of franchisors and franchisees, and our finalists are doing just that.”

For further information, visit www.thebfa.org or call the BFA on 01865 379 892.

Latest findings from the British Franchise Association survey 2010

Franchise industry contributes £11.8bn to UK economy despite recession 

• 94% optimistic about future business  
• Nine out of ten businesses are profitable 
• 86% increase in the number of women franchisees

UK franchise businesses continue to grow and remain robust despite economic conditions, with the industry contributing £11.8 billion to the country’s GDP last year, an increase of £400 million from last year, according to the latest findings from the annual NatWest sponsored BFA franchise survey.

The average turnover figures rose by just under 3% on last year’s figure at £335,000 in 2009, with levels in some sectors strengthening as the year progressed. The survey also revealed that compared to the ‘90s recession fewer franchise businesses today are trading at a loss, in 1990 only 70% of all franchise businesses were profitable compared to 89%in 2009.

2009 was a year where more businesses took up franchising as a business model, with the total number of franchise systems operating in the UK reaching 842, signalling a modest growth from the figure of 835 quoted last year. Franchisors’ confidence for the future of their business also grew with 94% being optimistic about business conditions, in comparison to only 82% last year. Franchisors and franchisees are hopeful about the potential for growth with franchisors on average planning for an additional 8.8 franchisee outlets.

Graeme Jones, head of NatWest’s franchise team, comments, “It’s encouraging to see continued growth in specific sectors, such as personal services, where franchise systems have grown by 38% in five years. We look after more franchises than any other bank and have seen far more optimism from our customers about the coming year in comparison to twelve months ago when confidence levels were low.”

Brian Smart, director general of the BFA, says, “Franchised businesses have weathered the recessional storm extremely well, which we should not be surprised about if we look at how franchising has proven itself over the years. The combination of the wider business support, training and economies of scale, with the determination, enterprising nature and local business focus makes franchise businesses a very robust offering. This year has highlighted this particularly well with success rates of franchise businesses not dropping even in the recent recessionary environment”.

The survey revealed how franchised businesses dealt with the recession by focusing on growing existing customer bases and increasing spend on marketing and advertising. One indication of how franchised businesses dealt with the difficulties posed by the recession during 2009 is a reduction of full time employees from 239 to 219, but a rise in part time employees.

The survey also unveiled a slight decrease in the number of individuals employed in franchising in the last 12 months from 467,000 to 465,000 (full time and part time) across a total of 34,800 franchised units in the UK. More women are now starting to get involved in franchising, with 39% of recent franchisees women compared with only 21% in 2003.

Encouragingly, estimated start up costs have declined slightly, and new entrants can expect to pay £46,700 in franchise fees and other associated costs to their franchisor (down from £50,000 last year).  Whilst almost half of franchises said that NatWest has the most helpful franchise department, for some lack of financial capital has been the biggest barrier for growth.

Graeme Jones continues, “The main indicator at the end of 2008 was that the outlook for franchisees and franchisors’ own businesses and for the economy as a whole, was grim. Those questioned in 2009 though were a good deal more optimistic than they were twelve months ago, with fewer mentions of redundancy or shorter working hours. We want to send a clear message out to the sector that NatWest is here to support growth opportunities”.

Brian Smart concludes, “It’s been a tough time for businesses across the UK but franchised businesses have clearly shown a high level of stability and robustness and made a valuable contribution to the UK’s economy last year. The survey paints a very positive picture of future realistic success for the industry in the coming year.”

For more on the British Franchise Association visit www.franchiseworld.co.uk

Talk, talk, talk mum's franchise launched

A mum who pioneered a new way of helping shy youngsters communicate and build self-confidence, has been nominated for three national awards as she launches the system as a franchise.

Libby Hill’s Smart Talkers pre-school groups have helped hundreds of youngsters in Staffordshire over the past two years, and they are now being rolled out across the country, with the first franchise in St Neot's, Leicestershire.

Libby has been nominated for a mum’s “Oscar” at the annual Mumpreneur Conference for mothers in business in September - and is also a candidate for the “Best New Business” award. The nominations will be judged by a panel which includes Jo Cameron, who took part in the BBC’s Apprentice, and ex TV Dragon, Rachel Elnaugh.

At the same time she is among the nominations for a national kids award scheme - What’sOn 4 2010, which recognises achievers in thirteen categories, ranging from pre-school activities through to community group work.

Libby’s methods, involving signing, games, stories and songs, have been adopted by pre-school educationalists all over Staffordshire, ensuring children can effectively communicate and learn when they reach school age.

Speech and language therapist Libby, whose business is based in Hednesford, Staffordshire, said: “So many children in the past have gone to school and failed simply because they lack the confidence to communicate and have been unable to concentrate enough to learn.

Info from www.smarttalkers.org.uk or 0844 704 5888.

Major magazine franchise relaunches under new owners and offers business opportunities across the UK

Major magazine franchise Raring2go! has re-launched under new owners and a dynamic business plan to expand the business across the UK and boost support for existing home-based franchisees.

Sussex-based Mojo Publishing Ltd., has bought and now manages the family magazine, which offers definitive local guides of what to do and where to go for families with children up to the age of 11. Seven hundred thousand copies of Raring2go! are already distributed quarterly in school book bags across the country.

New owner Freddie St. George is now targeting anyone who thinks they have the ability to run a franchise, especially those looking for a change of career, a new opportunity following redundancy or a home-based business that fits in with bringing up school-age children.

Key target areas for new franchises are Kent, Surrey, Sussex, South West England, north and south Wales, Liverpool, Lancashire, Birmingham, London and Scotland.

Freddie says: “We are very excited about acquiring Raring2go! Having worked with the original owners in a publishing capacity we got to know the magazine really well before we bought it, so we fully understand the potential for growth and exactly what support to offer new and existing franchisees.

“It’s a terrific opportunity for anyone looking for a career change or to get back into work after having children.

“A Raring2Go! franchise will deliver a sustainable business which is fun to run and can be fitted in around raising school-age children. Our most successful franchisees work hard but manage to achieve a good work-life balance, fulfilling their business ambitions and enjoying family life.”

Franchisees pay around £10,000 to acquire a publishing territory and can make up to £25,000 per annum per territory. Some franchisees now own up to five publishing territories while continuing to bring up young children. The re-launched business is also attracting interest from those facing redundancy or looking for a career change.

Further information about this franchise opportunity can be found at www.raring2go.co.uk

Online platform performs well for Cash Generator

A significant step for Cash Generator, the buy, sell and loan retailer, the new website is unique in the franchising industry. Visitors to the site can shop online instantly, purchasing items from any Cash Generator store from across the UK.

The website has been built with Microsoft Commerce Server, a proven platform, and with the function for instant stock inventory twenty four hours a day, seven days a week, an area Cash Generator plan to capitalise on in the near future.

For the first time, Cash Generator will be able to trade out of hours, taking advantage of the period when consumers commonly shop online, opening up huge potential for future growth.

Julian Urry, managing director at Cash Generator says: “We are incredibly impressed with the new website. We have invested heavily in it and firmly believe it will transform the way the business operates.

“Allowing consumers to purchase products form any store in the country, it is a first in the franchising industry.

“The first quarter results are very encouraging and I am confident that the website will play a significant part in the future growth of Cash Generator.”

Stuart Owens, commercial director at creative agency, Photolink Creative Group, comments: “It’s was a significant challenge to create a trading platform for Cash Generator that allows each franchisee the opportunity to list unique products for each store, in real time.

“The website is working well and we are pleased with the results. We hope this first generation of website will help build confidence in the brand and encourage customers to shop at Cash Generator, both in store and over the internet.”

Established in 1994, Cash Generator is the UK’s leading buy, sell and loan store offering a top quality selection of pre-owned and brand new items for sale as well as instant cash for goods and a range of highly competitive financial services including foreign exchange currency.

For further information on Cash Generator visit www.franchiseworld.co.uk

British Franchise Association open day luncheon

The British Franchise Association as part of their ongoing membership recruitment drive, are hosting an Open Day Luncheon for non-member franchisors on Wednesday, 19th May at Silverstone Race Circuit.

The agenda
11:30 Refreshments and networking

12:00 The presentations:
- An overview of the franchise industry and the BFA’s role in the market place
Brian Smart, BFA Director General
- What is means to be a BFA member and benefits franchisors gain
Mike Goddard, BFA Chairman and founder of Belvoir Lettings
- Franchising today
Sir Bernard Ingham, BFA President

12:45 Lunch and networking

To register contact the BFA on 01865 379 892.