Franchising Magazine, July / August issue 2012

www.franchise.net.au

AUS $6.95NZ $7.95

Franchising

Print Post Approved

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FRAN

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ISING

10 STEPS TO PRO

FIT JULY

/AU

GU

ST 2012 WW

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NC

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ET.AU

Jul/Aug 2012 VOL.25/No.4

Your essential guide to buying a franchise

THE BILLY BAXTERS CASE: WHAT IT MEANS FOR YOU

What you need to know

Buying into the

Dough-making businesses

BUMPERISSUE FREE MAG

SOCIAL MEDIAGUIDE

BRISBANE & MELBOURNEEXPO PREVIEWS

GO GREENEco-friendly franchises

TO PROFIT10 Live the dream

+

STEPS

burrito buzz

FR.JULAUG12.PG001.pdf Page 1 22/06/12, 3:03 PM

HIGH MARGINS, B2B MARKETPLACE AND WORK/LIFE BALANCE...ONLY WORK 5 DAYS A WEEK!

We provide our licensees industry leading resources, systems and processesproven sales and marketing systems and the ability to provide clients nationally recognised certicates and diplomas under our Registered Training Organisation (AUS) and Private Training Establishment (NZ) status.

As a licensee of LMA youll be able to guarantee your clients 3 things Permanent behavioural change of participants Measurable results against pre-determined goals and objectives Identi able ROI per participant

IF SOMETHING LIKE RETAIL, FAST FOOD OR HOME SERVICES IS NOT FOR YOU...

Heres 7 reasons why you should contact us Realistic investment range Comprehensive induction and training On-going advanced training and development Established brand with over 40 years experience Web based operations and communication systems Proven sales and marketing systems support Registered and respected Training Organisation

If You Want to keep your weekends free by working 5 days a week Have experience in sales, sales management and/or

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enjoying the freedom of your own business...

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License opportunities available in selected areas across Australia & New ZealandCall James Archer to receive your FREE information pack AU: 1800 333 270 (Free Call) NZ: 0800 333 270 (Free Call) or email: [email protected] www.lma.biz

TALK TO USHERES A BUSINESS TO BUSINESS WHITE COLLAR OPPORTUNITY

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JUL/AUG 2012 FRANCHISING | 3www.FRANCHISe.Net.AU

Contentsjulyaugust 2012 |YOUR eSSeNtIAL GUIDe tO BUYING A FRANCHISe

40

52

8RegulaRs5 editorial

6 News

8 Interview

155 Legal

156 Sketch

158 People

161 Opinion

162 Glossary

163 Checklist

182 Company listings

Inspire16 Brewing success

New franchise Adore tea20 Windows to the future

A Luxaflex licensee23 Building the brand Hire A Hubby franchisee26 strategy for success Getting good at retail30 an indulgent investment the endota story32 action man Living the dream36 sweet dreams come true Great taste of business

Opportunities40 Mexican wave the new look cuisine52 unleash your passion Love pets, make money62 give green a go eco-friendly franchises70 Rise and shine Bakeries and patisseries78 accommodating ambition Skills for the travel world86 join the ride! Check out the Brisbane expo 94 Walk this way Melbourne expo preview

Issues101 10 steps to a profitable business107 so you want to be A master franchisee110 lessons from court Legal case reviewed

How to...119 get the data Site selection explained122 Blueprint for a brand Branding: book extract126 Making connections Get a social media profile134 staying afloat How to manage debt142 5 steps to quick cash Invoice discounting144 How to buy a resale franchise what to watch for

144

62

FR.JULAUG12.PG003.pdf Page 3 22/06/12, 11:10 AM

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JUL/AUG 2012 FRANCHISING | 5WWW.FRANCHISE.NET.AU

SARAH STOWEEditor

Welcome

This year we are thrilled to be celebrating the 25th anniversary of Franchising magazine.

Next month: our special anniversary edition

PublisherMartin [email protected]

EditorSarah [email protected]: 02 9422 8900

JournalistDanielle [email protected]: 02 9422 2667

Sub EditorRichie [email protected]: 02 9422 8851

National Sales and Marketing ManagerDavid [email protected]: 02 9422 2905

Contributing JournalistsDomini StuartDonna Bennett

ColumnistsGreg NathanAndrew Terry Esther Gutnick

Production Co-ordinatorEryk [email protected]: 02 9422 2379

Creative Art Director Julie [email protected]

DesignerLouis [email protected]

Managing DirectorJeremy [email protected]

Editorial InquiriesTel: 02 9422 8900

Advertising InquiriesTel: 02 9422 2905 Fax: 02 9422 2722

Subscription InquiriesTel: 1300 360 126Fax: 02 9422 2633

Franchising is a publication ofReed Business InformationABN 132 719 861

SYDNEY OFFICETower 2, 475 Victoria AveChatswood NSW 2067Tel: (+612) 9422 2999 Fax: (+612) 9422 2722www.reedbusiness.com.au

Franchising

Average Net DistributionPeriod ending Mar 126,841

All Franchising material is copyright. Reproduction in whole or in part is not allowed without written permission from the Editor. 2012. Opinions expressed in Franchising are not necessarily those of Franchising or Reed Business Information.

Bumper issue, packed with goodies

Are you feeling inspired to shrug off winter and try some-thing new and exciting? Are you ready to take charge of your career? Well, there is plenty of inspiration in this, our biggest issue for ve years, starting with the kikki.K franchise opportunity. There are tales of dreams come true from franchisees, from business coaching to handyman work to retail; and stories of success from new and established franchisors. Whether the appeal of running your own business is all about facing the challenge or carving a nancial future to meet your goals there will be something in our Opportunities section to inspire: will you get a taste for the hot new Mexican wave, make money out of a passion for pets, dip into the environmentally-friendly trend, be tempted by an old favourite bakeries and patisseries, or reserve a place in the hotel and accom-modation eld?

To ensure you get a good look at whats in the marketplace it really is worth paying a visit to an expo dedicated to the franchising and business opportunities market. Coming up are the two day Brisbane show in July and the three day expo in Melbourne we preview both events in this magazine.

When youre at the expos take time to pick up some expert advice, either through the seminar program or at the free advice centre.

Because getting guidance and tips on the ins and outs of franchising will stand you in good stead thats why you are reading Franchising magazine!

In this issue we take a look at a recent court case in which the judge-ment favoured the franchisees with a million dollar award. Its a pivotal

case, and weve reviewed what the outcome means to anyone looking to purchase a franchise; this is a must-read.

Check out our nancial features in this issue too: Kate Groom has pinpointed 10 ways to make your business pro table, we look at how to manage debt, what to look for when considering a resale franchise and how to get your hands on cash quickly.

Add to this features on social media, branding and the role of a master franchisee and youll have plenty to keep you reading.

And with this bumper edition comes a bonus magazine for free, our popular supplement The Pro ler, which gives you a taster of business opportunities and services that could be just right for you.

Sarah StoweEditor

Are you ready to take charge of your career? Well, there is plenty of inspiration in this, our biggest issues for ve years


NewsONLINE NEWS | WWW.FRANCHISE.NET.AU

6| FRANCHISING JUL/AUG 2012 WWW.FRANCHISE.NET.AU

Do your lawyers:

reallyunderstandyourfranchisesystem?

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At Franchise Legal, we do. For an obligation-free chat with one of our principal solicitors in Brisbane, Sydney or Melbourne, call 1300 798 501 today or e-mail: [email protected]

Franchise Legal practises exclusively in franchise law, which means that our clients benefit from our extensive expertise in this unique area of business law.

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Do your lawyers: really understand your franchise system?

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At Franchise Legal, we do. For an obligation-free chat with one of our principal solicitors in Brisbane, Sydney or Melbourne, call 1300 798 501 today or e-mail: [email protected]

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A D _ F R F U R M A Y _ 1 2 . p d f P a g e 4 1 9 / 0 4 / 1 2 , 3 : 3 0 P M

The Fair Work Ombudsman has launched a prosecution against the operator of four Subway outlets in Newcastle, in regional NSW, over more than $50,000 in alleged underpayments of 11 young employees.

Facing court is Nicole Patrice Dawe, of Medowie, who part-owns and operates four Subway franchise outlets.

It is alleged Dawe was centrally involved in underpaying 11 employees at the four Subway outlets a total of $56,585 between 2006 and 2011 and that the major-ity of the underpayments affected employ-ees aged between 15 and their early 20s.

Employees were allegedly being underpaid the minimum hourly rate and some were also underpaid annual and personal/carers leave entitlements as well as payment in lieu of notice of termination.

The biggest individual underpayment alleged is $18,512.

Dawe was allegedly also involved in failing to comply with Notices to Produce

employment records, keeping proper em-ployment records and issuing pay slips in line with workplace laws, as well as com-mitting multiple breaches of workplace laws. She faces maximum penalties of up to $6600 per breach.

Fair Work Ombudsman Nicholas Wil-son said a decision to prosecute was made because of the signi cant amount involved for vulnerable, young workers and the employers failure to rectify the matter.

The Fair Work Ombudsman is also seeking a Court Order that any penalty imposed on Nicole Dawe go towards rectifying the alleged underpayments of the employees.

Brian Tap, regional director for Subway Systems Australia, commented on the alle-gations. We take any breaches of the Fair Work Act very seriously and we are look-ing into this disturbing matter, he said.

Each Subway Restaurant in Australia is individually owned and operated by independent franchisees; franchisees being responsible for hiring, training, remunerating and managing their staff according to law.

We expect franchisees, as small business owners, to follow all laws and regulations pertaining to operating their businesses. We encourage all our franchisees to treat employees fairly as it is in everyones best interest to do so and it recognises the contributions that indi-vidual staff members make, said Tap.

163,093 the number of Pizza Hut pizzas sold over a seven day period on the LivingSocial website, making it the largest fast food transactional group buying deal in Australia

Subway franchisee faces court



NewsNEWS BRIEFSONLINE NEWS | WWW.FRANCHISE.NET.AU

Cake franchise, The Cheesecake Shop, has launched a new 30 second television commercial its rst in more than a decade highlighting the journey of the cake from oven to customer

A Queensland-based air conditioner cleaning franchise, HydroKleen, has signed up 13 new franchisees in as many months and plans to double in size by next year

Crust Gourmet Pizza has launched a mobile app, available now on iPhone and Android at the App Store

BSR Group has awarded its high ying retailers and suppliers at its annual conference in Santa Monica, Los Angeles, with Betta Home Living Wilsonton from QLD taking out the Large Branded Retailer of the Year award for stores larger than 650 square metres

Muf n Break has scooped its third consecutive win in the Roy Morgan Customer Satisfaction Awards, putting it in the lead to claim the title of Coffee Shop of the Year

A new president, David Allen, will head up the Australian arm of Danish jewellery brand Pandora from July 1.

Just Cuts is offering a new retail concept in the form of hair cuts at a kiosk, with the rst instalment being unveiled at the West eld Doncaster shopping centre in Victoria

The chairman, and long standing board member of Zarraffas Coffee, Tony Williams, has resigned

The Athletes Foot steps online Franchise retailer The Athletes Foot has launched an online shopping facility on its website after working on the e-commerce project for a year.

Part of the RCG Corporation, The Athletes Foot offers a footwear tting service in its 140 Australian outlets and has been at pains to include tting aspects to the online store.

Ivan Hammerschlag, RCG chairman, told Franchising that web customers can answer questions around weight and running style online to get recommendations on appropriate footwear. They can take advantage of a 100-day free return service, and visit their local store for a tting service too.

We encourage customers to go in store

and be tted, but people want to shop online. We need to offer consumers the ability to shop on the web.

We expect to leverage off the growth in the digital channel, with the aim of delivering both additional sales and conveying our t and service message in more relevant ways to a new audience.

The move to web sales is also aimed at recouping some of the spend on

overseas online sites, Hammerschlag added.

There has been some leakage to offshore websites and we want to gather some of that business back. Our Shoe Superstore business, which is only small, takes 15 percent of sales on the web.

The launch of the e-store is a pivotal step in the execution of The Athletes Foot multi-channel retail strategy, he said.

It is importantfor persons looking at buying into a franchise to put [in] careful thought and investigation as well as getting proper legal and nancial advice. - Tony Garrison, partner at law rm HWL Ebsworth, www.franchise.net.au

FRANCHISING MAGAZINE LAUNCHES NEW LOOK WEBSITETo celebrate our 25th anniversary weve relaunched our website with a fabulous fresh design and easy functionality.

Our twice-weekly e-newsletter is also boasting a new look and is packed full of the latest industry news and views, delivered straight to your inbox every Monday and Thursday.

Features at www.franchise.net.au include:- A lively home page which showcases the latest and best from the franchise sector

- Great new sections which allow you to source the stories, news and advice

that interests you- You can view and add comments on features and start a discussion

- Its one simple step to join our Facebook and Twitter communities

- Click on the Magazines tab and read our digital editions

- Source franchise brands using our Directory, updated with Google maps

- Look for business support in our new Suppliers listing

Scan to go direct to the website


Inspire|Interview

8 | FRANCHISING JUL/AUG 2012 www.FRANCHISe.Net.AU

The retailer kikki.K is a multi-award winning design brand with a Swedish heritage. Its price points range from as low as $1.50 for a felt tip pen up to $500 for items in the premium leather range, Stockholm.

At the helm are creative director Kristina Karlsson, and her partner, CEO Paul Lacy, who began the business in Melbourne 12 years ago.

Paul Lacy answers our questions.

Why is the brand successful?Beautifully designed stationery is a small everyday-use luxury, a

little indulgence often under $50 that just makes people feel good. Its a more affordable option than say a new clothing outfit, but can make people feel just as good as an expression of their style. Our business has grown based on customers love of our unique products and passion for stationery and Swedish design.

How committed are you to franchising as a model, rather than just a means to finance overseas expansion?There are about 10 Australian-based stores were looking to sell as franchises at the moment Belconnen, Kotara, Macarthur,

Geelong, Brighton, Bowral, Erina Fair, Tuggerah, Glenelg and Hyde Park. Franchising these boutiques will provide us with additional capital to support the funding of further international expansion

Q&A

Sharpen your pencils, the

distinctive kikki.K brand is

looking for franchisee partners

to help grow the business

with KiKKi.K


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Inspire|Interview


throughout Asia and beyond. We clearly understand what

is required to be a world class franchisor and were completely committed to franchising as a model and to supporting the success of the people who join our team as franchisees.

Weve been assessing the potential of franchising for years because of the unsolicited requests weve received. But its really been since Janine Allis (Boost Juice founder) joined our board over a year ago that weve carefully considered and planned the strategy. Over eight months ago we hired Janines former CEO International, Jacinta Caithness, to head-up our franchise strategy.

Weve always focused on developing turnkey systems and processes that support our store teams and enable stores to thrive. Were Melbourne-based and our third store was opened in Sydney, precisely to force ourselves to create brilliant systems and processes that would ensure we

could scale up and roll-out stores quickly and productively across the country and eventually the globe.

Having opened 82 stores in 10 years across Australia, New Zealand and Singapore, with compound double digit revenue growth year on year, theres strong evidence our systems and processes are good. These systems now provide a brilliant base for our franchising model.

Enabling us to redeploy capital for our ongoing international growth is just one element among several key reasons for franchising.

We believe its possible that franchise stores could be more productive than company-

owned stores and we really want to test that theory; we believe franchising could be a relevant strategy as we roll-out across the globe and we want to build our experience with the franchise model domestically. And were excited at the thought of welcoming external parties into

our business, bringing with them different experiences and fresh ideas for the benefit of the entire network.

Were a very open and learning focused business plus we love and encourage the exchange of ideas and experience within our business.

Its a very clearly thought through strategy. Were totally committed to very quickly becoming a world class franchisor and valuable partner and we feel confident in our ability to execute a domestic franchise strategy that supports the success of franchisees.

What are the Asian expansion plans?Weve currently got three kikki.K stores in Singapore and see strong opportunities there. Weve also had numerous strong inquiries from quality landlords across Asia and from potential partners wanting to purchase the rights for various countries. Were being very careful to work through the opportunities and choose the right locations and partners which will provide the perfect alignment for our brand.

What will the franchise offer be?Well be offering prospective partners the opportunity to buy existing kikki.K stores that have strong trading histories and very well established customer relationships.

In terms of training and marketing support as well as operational, visual merchandise and product support for that matter the program we have in place to support franchisees in the operation of their own kikki.K store is very robust; its been improved on a day to day basis across 82 stores in three countries by our store managers.

How much control will franchisees have in terms of merchandise?A key to the success of kikki.K is our merchandising approach and

Weve always focused on developing turnkey systems and processes that support our store teams and enable stores to thrive


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Inspire|Interview


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A D _ F R M A D M A Y _ 1 2 . p d f P a g e 1 1 4 / 3 / 1 2 , 9 : 2 0 A M

the combination of strong design and innovation (we drop new product into stores around every three weeks). Its vital for the brand and the success of all stores and partners that we maintain consistency of product ranging and merchandising so well have strong controls in place to support the success of franchisees.

Weve invested heavily in merchandise forecasting tools to deliver automatic replenishment, all on an individual store basis.

This works so successfully for our company owned stores, we would envisage that each of our franchise partners would also opt

into using this system, enabling ease of ordering and stocktake etc.

There are differences between stores in terms of sell-through on individual product lines and our system is sophisticated enough to determine the variances which may be required between stores. Our franchise partners would also

Having opened 82 stores in 10 years across Australia, New Zealand and Singapore, with compound double digit revenue growth year on year, theres strong evidence our systems and processes are good


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Inspire|Interview


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have input into this as our store managers in company-owned stores do now.

Retail is a tough market right now, why should a franchisee invest in the brand?Thatll be up to each individual, of course. The strong interest weve had from people in buying a kikki.K franchise over the years,

and recently, indicates many people already have their own reasons.

Personally, Kristina and I have grown the business for 12 years through a few cycles and weve always seen opportunity in both good times and challenging times. Weve recently been nominated for a World Retail

Award for Innovation and we really feel the kikki.K journey is just getting started and there are some very exciting times ahead for all of our stakeholders. Now is as good a time as any to join us on the journey.

Were only looking to sell six to 10 of our existing company-owned stores initially. The purchase prices we have placed

on each of them we feel are competitive and weve been really encouraged by the number of unsolicited inquiries we have received as well as the interest that our franchising initiative has generated from within our existing network and kikki.K community.

Were very proud to be a new

generation retailer really open and innovative and we have a very strong, motivated and engaged retail team, providing on-the-ground operational expertise, and linking back to in-house departments of design, merchandise, human resources, marketing, finance and IT. In operating our 82 company-owned stores weve developed a very strong retail and head office infrastructure for all our kikki.K franchise partners to tap into and benefit from.

What are you looking for in a franchisee, other than passion for the brand?Since day one, its been our passion that has played a huge part in driving the success of the business. Not just us personally, but each and every member of our wider team. Were looking for like-minded people who will strive to work towards our brand vision. F

Weve invested heavily in merchandise forecasting tools to deliver automatic replenishment, all on an individual store basis


AD_FRANYMAR_12.pdf Page 1 3/02/12, 10:26 AM

Inspire|Franchisor

16 | FRANCHISING JUL/AUG 2012 WWW.FRANCHISE.NET.AU

With ambitious growth plans and a commitment to educating consumers that theres more to tea than English Breakfast, Adore Tea is serving up an exciting new opportunity for motivated self-starters

Despite being the second most consumed beverage in the world next to water, tea seems to play second ddle to coffee in todays food service world. But not for long, if Adore Teas Marc Nieuwenhuys has anything to do with it.

He launched the Adore Tea concept about four years ago and is now ready for fast, fruitful growth through franchising.

We were waiting until we were able to support multiple stores. When we decided to franchise about 18 months ago we only had one store so we really felt that to be able to offer a good solution we needed to have multiple stores so that we could try our procedures, so we opened two more company stores, Nieuwenhuys tells Franchising.

Once we had them up and running and successfully trading we felt like we were ready to handle more.

Adore Tea is now offering franchising opportunities in two different formats: the retail store, which will also includes a Tea Espresso bar where consumers can get a top quality, loose leaf takeaway tea, and the tea house. The former sells a wide range of tea and tea products while the latter also operates as a caf of sorts, serving tea with a range of sweets and snacks.

There is currently one tea house operating in Canberra, and while Nieuwenhuys is keen to grow this area of the business and is considering potential sites in Sydney, hes focusing more on the retail stores which he says will be able to see the business grow at a quicker pace. The tea house also requires much more of an investment from the franchisee, both in terms of funds and effort.

Its a little bit harder to operate. It takes more staff and it takes a very skilled

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operator to manage. Its the hospitality industry. So in a retail store you can train someone, put them in [store] and they can open. You only need a couple of staff and youre good to go. To open a full size tea house like one of ours our tea house has 68 staff on a roster, five managers and it seats 260 people its a really big venture and you need a really committed, experienced person to do that, he says.

Despite not having any

franchisees signed up just yet, there is strong interest in both areas of the business and Nieuwenhuys has some serious growth plans.

Were looking at opening about five new retail locations this year in Sydney, and were looking at one possible tea house location in Sydney as well. Weve got huge amounts of interest in Melbourne as well, so we definitely want to see three to five stores in Melbourne this year. Wed really like to see a total of at least 10 to 12 by the end of the year, and then next year Id like to open 20 more.

On the lookout for new franchisees, Nieuwenhuys says people considering the tea house format will need to have some hospitality experience, but if theyre considering a retail store, all they need is to be a very motivated people person.

In a word, were looking for people that are prepared to be passionate about the product

and passionate about providing an extremely high level of customer experience, which is what we believe very strongly in. Were very customer experience oriented and we want to educate people correctly about tea.

Nieuwenhuys has made the Adore Tea concept as low maintenance as possible for franchisees, who hed prefer be

Were very customer experience oriented and we want to educate people correctly about tea

Inspire|Franchisor

Adore Tea has tea houses and retail stores



Franchisor|Inspire

Ph: 07 5532 7071e: [email protected]

Specialising in casual and relaxed diningFamous for our premium quality steaksFranchisors with over 20 years experience in hospitality & franchisingProven easy to follow systemsFull support in all aspects of running the restaurant

FranchiSeS available auStralia wide!

A D _ F R O U T N O V _ 1 1 . p d f P a g e 1 1 3 / 1 0 / 1 1 , 3 : 1 5 P M

on the floor, interacting with customers than working the books behind closed doors. For example, the company runs an automated purchase order program, which means that every Monday the warehouse receives an automated purchase order from the stores, ensuring that they are replenished and fully stocked each week without the franchisee having to manually place an order.

But that doesnt mean Adore Tea franchisees can rest on their laurels. Before setting up shop they must learn the ins and outs of tea all 200 of them and must be prepared to not only take advantage of the consumers increased interest in all things tea, but to also teach them about how best to enjoy a brew.

We have a really good training program in place to get people to understand tea, so not just understanding all 200

blends, but understanding a little bit more about where it comes from, why it tastes different, how it tastes different and how to get different flavours out of different teas, he says.

Tea is the new coffee, thats

our slogan at the moment. Were operating successfully, and premium quality tea is, especially with the financial crisis in the world, a little luxury that everyone can still afford, so were in a good niche market. F

Adore Teas Chocolate and Truffle Rooibos tea

Scan here to see our video interview with Nieuwenhuys at the recent Sydney expo


WINDOWS TO THE

FUTURE

Inspire|Franchise story

Brand innovation and support - what a difference a license makes

Ashley Robinson can speak to the power of a brand; his family has been selling Luxa ex blinds for more than 30 years. The Robinsons have been in the window blinds business since 1976 rst selling Venetian blinds from home, then moving into a showroom in 1988, and running a heating business alongside. When they snapped up the Luxa ex Window Fashion Gallery license for the Castlemaine area they were only the third Victorian business to embrace a licensee opportunity.

Once the licensee program was set up, the business grew very quickly, says Ashley, who has

worked in the family business for 12 years. We knew if we wanted to stay the market leader in the area we needed marketing innovation and we knew it would set us apart. Its an opportunity to showcase the entire range, to get marketing support, displays and support fro m the company.

Taking on the license meant increasing the showroom size by 50 percent and a boost to the family of three managing the business with two staff members. The business had previously had access to the full ranges but needed a better showcase to take advantage of the 70-odd products to show customers.

This gave us greater exposure to a bigger market, and it paid for itself in the rst 12 months. We had products customers had never seen. We experienced high growth for four or ve years.

Ashley admits the inevitable plateauing of business has meant growth has dropped down but its still at a more than respectable 10 percent, given the climate and a more cautious clientele. The $5,000 spend on blinds is still taking place, but less regularly; quality conscious

We dont look at what others are doing, we just do the best we can and let them catch up

The Robinsons have been in the window




Franchise story|Inspire

For more informationcontact the National Support Office

07 3622 2888

A D _ F R M R R J U L _ 1 2 . p d f P a g e 1 2 9 / 0 5 / 1 2 , 1 0 : 5 1 A M

customers are avoiding hurried purchases and waiting until they can afford to buy their pick of the range.

The clientele has changed in the last ve years too, he adds, as the town of 8,000 people becomes more of a Melbourne commuting spot, just 90 minutes from the city. But while theres another Gallery at Ballarat, one hour away, and other Luxa ex suppliers even closer to Castlemaine, Ashley is unconcerned about competition.

We dont look at what others are doing, we just do the best we can and let them catch up.

As licensees in the system, the Robinsons can offer customers a 20/20 guarantee if the customer isnt happy with the blinds theyve chosen, they wait 20 days after in-stallation and can then change them

for a fraction of the cost and get the new blinds within 20 days.

It offers peace of mind, says Ashley.

When it comes to business support, he says the Luxa ex parent company, Hunter Douglas,

does its part. Our sales manager gives us good support and we see him quite often. Im in constant contact with marketing, and we get good back up from the call centre.

Ashley has noticed a spike in customer inquiries when he mentions the website in his radio ads there is a store page within the Luxa ex website that takes customers directly to the Robinsons business. F

This gave us greater exposure to a bigger market, and it paid for itself in the rst 12 months

The Robinson family A Luxa ex window fashion gallery


Seeking New Franchise PartnersPizza Hut is the worlds largest pizza restaurant company with more than 12,000 restaurants in over 90 countries. A subsidiary of global QSR giant Yum! Restaurants International, Pizza Hut boasts a strong history in Australia since opening its rst Australian store in 1970.

As a franchisee, Pizza Hut offers you the advantages of investment in a proven brand; exible hours for individuals and families; and fun, exciting revenue potential within a great system.

Pizza Hut has exciting new store opportunities available throughout:s Melbourne & Regional Victorias Perth & Western Australias Regional New South Waless South East & Regional Queensland

We are looking for owner operators who have a hands on approach and a head for business. Sites have been selected, you just need to start training. Minimum equity requirement is $100,000.

To nd out more please visit www.pizzahut.com.au/franchise

AD_FRYUMJUL_12.pdf Page 1 7/06/12, 10:29 AM


Franchisee|Inspire

For Paul Minords, Hire a Hubby franchisee in Sydneys Neutral Bay, no two days are the same.I do a lot of hanging doors

and a lot of carpentry work but today, for instance, Im doing some painting, and Im doing a little bit of fencing this afternoon. It varies so much. Yesterday I was up on the roof doing some gutter work. You couldnt put a typical day down, and thats what I like, he says.

After working for himself in the UK as a carpenter then moving to Australia and being employed by a door company in Brookvale, Paul was keen to get back to working for himself,

and Hire a Hubby, the mobile handyman franchise, was a perfect t.

And while he has experience in a trade, other Hubbies dont, and its certainly not a requirement by the franchisor, Paul adds.

A lot of the Hubbies are from the corporate world. You need to have hands-on skills. You need to know how to use tools and be con dent using tools, and know what youre doing. But for the guys that need a little bit of tuition on certain things, there is in-house training.

Support doesnt just come from the top end either. Paul says theres

a strong camaraderie between the Hubbies, who without hesitation will lend a helping hand on other franchisees jobs.

Around my territory Ive probably got ve or six Hubbies that would come to site with me at the drop of a hat, if need be. We all do it for each other, he says.

Ive heard that a lot of franchisees [in other systems] are ghting one another for business, but were all Hire a Hubbies, so if the Hubby next door to me does well, hell make my business do well. Were trying to build up the brand as a company, not as individual owners.

I come from the building

BUILDING THE

BRAND

Its all for one and one for all at Hire a Hubby, where Sydney franchisee Paul Minords and his fellow Hubbies share a common goal

Paul Minords


Inspire|Franchisee


A Bright FutureAwaits You with Australias Leading Mobile Ink Franchise Proven System Low Entry Cost Strong Cash Flow Proactive Marketing Growth Market

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game back in England so Ive got all the skills I need but some of the other guys will call another Hubby and say can you help me out on this job? and then theyre learning as theyre earning. Well go through what needs to be done

and well spend all day with them if need be, teaching them how to do that job. Theyve always got us to back them up, to call on us if they need any advice, Paul says.

Another advantage of the Hire a Hubby system is that franchisees

have the flexibility to define the parameters of their work.

I dont get involved with creepy crawlies... I dont want to be crawling under houses. Theres some stuff as an individual that I dont want to do. So Ill go and have a look at the job and point the customer in the right direction for someone who will do that.

And while he might not make any money from these referrals, Paul says its going that extra mile for a customer that will keep Hire a Hubby front of mind for the franchises clients, which at the end of the day can only be of benefit to his own business.

The franchisor does most of the advertising for all of the Hire a Hubby team and I did leaflet drops when I first started, but generally its recommendations. Mrs Jones down the road tells Mrs Smith that Paul from Hire a Hubby is capable and does a good job, then she employs me and it all snowballs from there. F

Word of mouth recommendations are the best form of marketing, says Minords


For over 20 years our trusted franchise model has proven itself as an outstanding performer in the corporate travel industry. With more than 140 locations across Australasia, Quest provides the perfect opportunity to run your own business within a well-established and successful organisation.

Were searching for franchisees with demonstrated business acumen in any industry to leverage their capabilities in one of our new or existing Quest locations.

We are completely committed to managing the success of our relationships by offering learning and development training through an extensive support network, with the goal of facilitating healthy fi nancial returns.

If youre looking to buy into a trusted Australian market-leading brand, then a unique opportunity with Quest is one you wont want to miss.

Find out more at questfranchise.com.au

Your perfect travel companion

Andrew Edsor, Quest Franchisee at Quest North Ryde and Quest Bondi Junction

I didnt want to buy a job,One of the things I looked at when buying a franchise was;

I wanted to buy a business.

QSA292Ad121710951[QUAIA0].pdf Page 1 19/06/2012, 11:41 AM

Inspire|Franchisor

26 | FRANCHISING jul/AuG 2012 www.FRANCHISe.Net.Au

The company started out selling water beds then evolved into tubular steel framed beds, and now stocks contemporary bedroom furniture, mattresses and manchester. Culmsee says Were happy with our performance on growth this year.

This is a pretty experienced franchisor, weve been franchising for 30 years, so of course that helps. Weve been through tough times and the people in the head office have been in retail for some time.

We also have a very committed group of franchisees who add value to Bedshed.

So whats the key to getting ahead in retail?An inclusive approach to franchising means that franchisees are involved at a strategic level of the business, explains Culmsee; for instance, joining the overseas buying trips. In retail its always an uphill battle to get product compliance, but we do the hard work upfront. It means franchisees are behind the choices.

Up to 15 out of the 30 franchisees in the network might travel and get involved in the buying process, selecting and fine tuning product choices and keeping an eye on costs.

The chain has no central storage facility. We import directly so that cuts freight costs, says Culmsee. Franchisees must maintain their own inventory, typically stored in a 500 square metre off-site warehouse. We can deliver to the customer very quickly, thats our major competitive advantage. Some franchisees will land containers every week, he adds.

The trend is for buying quality product, theres been a real resurgence at the upper end in the last nine or 10 months. People are buying to last but there will always be a constant demand for lower priced products such as kids

strategy for

successBedshed is forging ahead in a tough retail climate. Franchising spoke to gavin culmsee, chief operating officer, to find out how

Gavin Culmsee


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Inspire|Franchisor


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mattresses. People come to us for advice, thats part of being a bed specialist.

Culmsee believes the biggest retail cost is occupancy and the franchisor will offer to negotiate or renegotiate leases on behalf of franchisees. Landlords now are a bit more open to discussion, he says.

The retail footprint is between 800 and 1000 square metres, and a franchise will cost about $500,000.

OpportunitiesThere are 40 stores, of which 10 are company-owned, and expansion across the chain has been through multiple store ownership, but theres still plenty of room for growth, Culmsee insists.

In our network theres a massive opportunity in NSW, some in Queensland and a great opportunity in Tasmania for a franchisee in Hobart and one in Launceston. There are only two stores in NSW (in Mittagong and Warners Bay near Newcastle). We can open 30 stores without impacting on our existing stores.

Involvement in the

store set-up process for franchisees is key, he says, so its preferable to match a franchisee to the right store rather than establish a company outlet first.

Were looking to open in the right places, so five or six stores a year. We want to make sure our franchisees are happy with their returns.

Retail experience is not required of franchisees, Culmsee adds. Weve got ex-auditors, fitters and turners; we want people who have the right outlook and want to be a part of this. F

There are some common traits spotted in Bedsheds successful franchisees:1. FRANCHISeeS ARe teAm plAyeRSOne of the advantages of joining a franchise is the support from other franchisees and the franchisor; you dont have to go it alone. Theres a network of franchisee partners who draw on each other to address their individual business challenges and share tips and tricks. At Bedshed this is backed up with three decades of franchise experience.

2. A pASSIoN FoR CuStomeR SeRvICeAs online shopping continues to grow, its important for bricks and mortar retailers to value-add for customers in store. Customer service is the key to competing with the popularity of online shopping. Successful franchisees have a can-do attitude and their customers are always their first priority.

3. oN tHe FRoNtlINeAt Bedshed, we have seen time and time again that franchises are most successful when the franchisee is directly involved in the day to day running of the business. A retail franchise is not a set and forget investment so the more you put in, the more rewarding it will be. Franchisees who are passionate about what they do can gain valuable knowledge about their business by working alongside their sales staff on a daily basis. They also enjoy the advantages of being their own boss and setting their own hours.

4. leARNING New SkIllSWhile it is useful for potential franchisees to have some background in retail, and the market they are working in, or experience of franchising, it is far from essential. At Bedshed franchisees have come from fields as diverse as the metal working trade and corporate accounting. Many people find the skills they have from vastly different roles are transferable to their new career as a franchisee.


AD_FRCONJUL_12.pdf Page 1 5/06/12, 3:58 PM

An indulgentinVeStment

Inspire|Franchisor

30 | FRANCHISING Jul/AuG 2012 www.FRANCHISe.Net.Au

mel gleeson and Belinda Fraser created the endota spa brand at the ripe old age of 26. now, more than 10 years later, they have their sights set on nationwide growth

Aluckybusinessisonethatisabletobothweatherafinancialcrisisandbesome-whatimmunetotheeffectsofonlineretailing.Thatsexactlythepositionthatbeautyspafranchiseendotaspaisintoday.

Co-founderMelGleesonsays,Yourestillgoingtogetyoureyebrowswaxed.Ithinkpeoplemightnotsplurgeonbigholidays[duringtoughtimes]buttheystillwantthegirlsdayoutoracoupleofhourstofeelrelaxed.Also,Ithink

ourretailinghasntgonedownbecausewereanexperience.Soyoucomein-storefortheexperience.Youcantgetamassageonline.

Endotaspalaunchedin2000andtodaythereare66spasacrossthecountry,which,whenFranchisingspoketoGleeson,wasexpectedtojumpto70bytheendofthefinancialyear.Thefranchiseoffersbeautytreatmentsincludingwaxing,tanning,massagesandfacialsaswellasspatreatments,anditalsohasaretailelement,sellingitsowncertifiedorganic

beautyrange,aglycolicskincarerangeandanaillacquerrangewhichitsellsin-store,onlineandinDavidJones.

Expansionandproductinnovationaretwokeygoalsforthetwofriendsandbusinesspartners.

Eventhoughtheresalotofdoomandgloomaround,ourspashaveincreasedinturnoveronthelastyearwhenwecomparedlikeforlike,soitsaboutrefiningthesystemthatwehave,andfindingmotivatedfranchiseestogrowourbrandin


Franchisor|Inspire

INVESTmENT

our new states. Queensland and WA in particular are our focus, explains Gleeson.

Some of the exciting things that were doing are around strategic planning and research, so weve talked to industry experts retailers, CEOs from different spa companies, cosmetic surgeons, Victoria University about endota and where we should be heading in the future, and one of the things that stands out for us is developing an anti-ageing range with measurable results.

So thats a focus for the product company at the moment, and for the franchise company its to get to our goal of 130 spas in Australia. Wed like to reach that by 2014, says Gleeson.

Franchising is the best way for her and Fraser to achieve this goal, she says, not only because she believes franchisees are often more diligent and motivated than managers, but because it allows them to grow quicker than they ever could independently.

Not surprisingly, the majority of endotas franchisees are women, particularly ones whove

previously led a corporate life, and while this isnt a prerequisite at the franchise, a passion for the brand is essential.

Weve been really lucky because even now when we talk to our business owners

and our therapists, they love the endota brand, and they actually want to perpetuate that. We havent had people, and I know this happens in franchising networks, trying to manipulate the brand at all. Its fantastic, says Gleeson.

Making sure all franchisees are on the same page and that the endota vision is maintained despite its steady growth is a priority for the two founders, and is ensured by staying in close contact with the whole endota team.

I think its about making sure we communicate effectively with all the stakeholders our head office team, our business owners, our therapists and we do that a lot. We have days where we get together, and Belinda and I have recently been on a roadshow visiting a lot of our spas, talking to the therapists.

The main thing is that I think everyone in our network, from therapists to business owners, got into this industry because they want to make people feel better. So everything we do, were striving to reach that goal and thats really the driving force that unites us. F

Jul/aug 2012 FRaNCHISINg | 31www.FRaNCHISe.Net.au

endota spas retail range


32| FRANCHISING JUL/AUG 2012 www.FRANCHISe.Net.AU

actionman

Inspire|Franchisee

a franchise lets andrew Laurie live a dream lifestyle

Andrew Laurie has run his own Action Coach franchise since 2009. And it allows him to live the lifestyle he and his wife have planned for themselves and their two young sons.

What Andrew describes as bad fortune gave him the chance to review his life a few years ago. When I was skiing in Canada I fell off a 100ft rock cliff, and had to be resuscitated. During convalescence I came up with a goal of what I wanted to achieve in 20 years; I came up with clarity about how to live.

I was still single, going through the evolutionary career trajectory. I went to uni and did the course I was expected to do, that led to the logical job, I did reasonably well, took the logical next step, without having thought what was my real direction.

I decided that to achieve what I wanted in 20 years Im going to have to be running a one billion dollar company; and in five years Id better be running a company. So I need to learn about business, so in two years I need to do an MBA, and get it from the best school in the world.

Armed with experience at Ansett, and in corporate travel in Hong Kong, Andrew embarked on the MBA before becoming managing director of large travel chains in the UK. His work gave him the opportunity to travel, and to indulge his taste for adventure sports climbing, skiing, sailing around the world.

But after a few years it wasnt all a joyride.

Being able to say to people, Im 35 and CEO of a multi-million dollar company was the only thing I really liked about my job.

What he didnt like was the stress, waking up at 3am anxious about the business.

Andrew had met his Belgian investment banker wife in France, and they were living in London with their son when it came to the career crunch. We took 18 months to travel around and decide what we wanted to do.

Settling in Sydney, the couple still intended to lead some of their life in Europe all four of us ski, climb and

sail. He knew he couldnt be an employee working full time.

I knew I wanted to build businesses and coaching on business was a reasonably obvious move.

But an Action Coach franchise was an accident. Andrew had plans to start his own business and went to a seminar for competitor analysis.

I didnt know much about it, or that it was a franchise. I saw [founder] Brad Sugars presenting, thought it was good stuff, and got chatting to other coaches.

At the time the business was launching a territory-based franchise model.

My goal was always to build a business that could live and breathe without me. The territory model appealed.

He spent two months on due diligence. I did everything you should


AD_FRAFMMAY_12.pdf Page 1 3/04/12, 3:11 PM

Weekly Media have discovered a new and improved way to feed your appetite using a full range of top selling Australian magazine titles along with International publications, and all it takes is the single push of a button. The new magazine media station is packed with Australias most popular lifestyle titles and is attracting a generous dollar through combining convenience with on-the-move retail solutions. The concept is simple, the start-up is supported, the potential is endless and the opportunity is yours.

Beyond its contemporary exterior, this advanced magazine display represents direct marketing with strategic edge in premium locations 24 hours a day, 7 days a week. Thats right, even on public holidays. The street savvy media kiosk appeals to a collective audience of children, teenagers, adults and seniors to forego the hassle of unplugging earphones, ceasing to talk on mobiles and cueing up in crowded shops in order to consume their literary fix.

From the moment you jump onboard this rare and exciting investment opportunity, you are assured that you are not alone, with Weekly Media offering installation, training and support to help you achieve your business goals.

Gone are the days when you need to wait at busy retail outlets to purchase your top-selling magazine titles, such as GQ, Cleo, Good Health, Womans Weekly, Rolling Stones, FHM and many more. If youre running late to a flight, bored at the train station, or perhaps youre just enjoying the attractions of your local city; consumers will be drawn to the ease and benefits of our self-automated newsstand showcasing the latest headlines.

European engineered with quality materials in a streamlined design and modified for the Australian market, the advanced

media stations now offer not only magazines but newspapers. Weekly Medias new business opportunity represents a blue chip investment for those seeking a new and flawless market concept. This superior stream of newsstand allows you

to take your share of the multi-billion dollar print and media industry without the need to become an expert in sales.

The beauty is in the packaging when it comes to modern marketing tools and Weekly Media are offering you a chance to be a part of a real

head-turner; an innovative product that will establish a profitable business that manages and markets itself. The Weekly Media advanced magazine media stations will be popping up at a corner near you, the question is whether youll be the one whos reaping the rewards.

For further information please contact [email protected]

1800 766 170

AD_FRWEEJUL_12.pdf Page 1 13/06/12, 9:35 AM


Franchisee|Inspire

03 8631 7710 or visithudsonscoffee.com.au/franchising

Franchise opportunities now available nationally.

and enjoy every day

For more information on joining Hudsons Coffee, call Carly on

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do. When I first spoke to franchisees the story I got seemed too good to be true, then the more research I did the better it got. I spoke to about 30 past and present franchisees. There was a universally positive response. I have an economics degree and an MBA and on my own I knew I would be literally years behind it if I got there at all.

We finalised the deal in December 2009, and had a skiing holiday booked for January and February so we didnt start till March.

The growth has been better than planned: in five months Andrew had reached his 12 month goal. That was the trigger to get someone else in and there are now six people in the business.

He is reaping the benefits of his business success with a lifestyle many would envy. In the first year I thought I should only take off one week at a time, in the second year I decided I could take two weeks off in one go, now Im in the third year and we had three and a half weeks off in April. We went climbing in Spain, skiing in France and saw family in Belgium.

A regular one page report from the admin director kept Andrew on top of the business while away, but he admits there were some days in Europe when he didnt turn on a computer.

Back home, a regular routine means time is scheduled for his young boys: breakfast six days a week and from 5.30 to 6.30 every night.

Coaching is brilliant fun, I absolutely love it, says Andrew. Firstly theres innate satisfaction working with clients; as they get more free time they get more excited. Secondly, we work hard on what sort of a team were building. Its really enjoyable coming to work.

And the business continues to grow with clients seeking change excited about investment in coaching, despite tough economic times, he says.

The territory is 64,500 businesses, small and large. A full time coach can coach 20 to 25 businesses. Were hardly scratching the surface. F

Coaching is brilliant fun, I absolutely

love it

Andrew leads an action-packed family life



Inspire|Franchisee

When Anna Calcagno rst saw the Gelatissimo gelateria, she fell in love with its look and the beautiful gelato, and she knew it was her ideal franchise. Now Anna owns the Lygon Street outlet in Carlton, Melbourne and shares her story.

1. Why did you choose this franchise?I truly believed in the product. I knew the avours were amazing and the beautiful presentation would make it easy to sell.

Going down the franchise route was safer in our minds than starting something from scratch. After our initial enquiries we felt comfortable with Gelatissimo, because it offered the support we needed, not only at the

beginning but on an ongoing basis.

When our location came up in a popular eating district known as little Italy in Melbourne, we didnt hesitate to grab it and went from there.

2. What did you do before taking up a franchise?While our children were young I worked in my husbands business in a part time administrative capacity.

3. How did you raise the nance?We had recently sold a half share in a business that had been extremely successful, so

we were suf ciently cashed up to have enough money to cover our start up costs, renovation expenses for our gelateria and working capital

to carry us through the rst few months of trading.

4. What training and support did you receive initially and ongoing?We had in-of ce training in Sydney and on-site training in the Coogee gelateria. Two head of ce staff came to Melbourne for our opening and the rst ve days. Support has always been excellent and continues to be so today.

5. What is a typical day for you as a franchisee?Because I manage my own store, I work in a full time

For Anna Calcagno a Gelatissimo franchise is a perfect match

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Franchisee|Inspire

BRW Fast Franchis

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2011, 2012

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AFR Smart Investor

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Golden Bean

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A D _ F R C A F J U L _ 1 2 . p d f P a g e 1 2 8 / 0 5 / 1 2 , 9 : 4 7 A M

capacity, so my shops presentation, including the gelato display, is always of a high standard.

The first thing I do each day is ensure that any surfaces not properly cleaned the night before are wiped down and sparkling. I then set up the till so there is enough change to get through the day.

I check which flavours need to be made so all the trays are full and looking fabulous and make what is necessary, re-garnishing or fixing any flavours not being made but which are perhaps looking a bit shabby.

There is always some paperwork, be it rosters, paying bills, banking etc, and this fills in the days. We defrost various freezers during the week, including both rotundas and the three upright freezers in which we store our back up stock.

And, of course, we spend time with our customers, so their experience in our store is a great one.

6. What challenges have you faced?The biggest challenge is ensuring my staff maintains my very high standards. Because I know its impossible to be there constantly, I concentrate on training staff better on a one-on-one basis.

7. Has becoming a franchisee changed your life, if so how?I would say that becoming a franchisee has changed my life. It has given me a confidence I didnt know I possessed. I realise how much I love people and dealing with them. I am really happy to go

to work every day. Its also been rewarding financially giving us extra play money at a time in our lives where we can enjoy it.

8. What advice would you give to someone thinking of buying their first franchise?Do your research and speak to people involved in that particular franchise. Learn as much as possible about the product and if you truly believe in it and are confident other people can also love and want it, then go for it. Do your sums carefully so you dont put yourself under too much pressure financially and ensure there is a strong team behind you, to guide you along the way.

9. What are your plans for the future?I love my job and the rewards are great, so for now things

will remain as they are. I would hope that within the next few years my husband and I can think of semi-retiring. We may opt to sell what we have and live off our earnings and hard work or have someone in place to manage our shop and just have a minimal involvement.

10. Would you do it again?Absolutely. Im sorry I didnt do it earlier in my life. Being involved in a franchise with a great team and a sense of family is wonderful. All my hard work is paying off. Its been rewarding both financially and personally and Im very proud of the person Ive become building my business and making it a success. F

It has given me a confidence I didnt know I possessed. I realise how much I love people and dealing with them


Opportunities|Mexican


If youre talking food trends, the rise of Mexican cuisine would have to be at the top of the list. Over the past few years, Mexican has gone from being a niche offering, found in the odd food court or occasionally as a stand-alone restaurant, to a surety in most suburbs. And many of the brands out there, responsible for the rapid rise of burritos, taco and quesadillas are franchised, with strong growth plans and a mission to re-educate the Australian palette, which often associates Mexican food with the cheesy, sour cream heavy, greasy dishes of yesteryear.

FRESH FOCUSVictorian-brand La Solas, established in 2002, has three company-owned stores in Geelong, Torquay and the Surf Coast and is keen to sign up its fi rst recruit after hitting somewhat of a growth speed-bump over the course of the GFC.

According to founder Michael Baker, one of the biggest hurdles to expansion, both of his own brand and the Mexican cuisine in general, has been the negative stereotype associated with the food.

The biggest road block weve faced in trying to get this model up and running is the education of the general populous. Unfortunately, Mexican food, during the 80s and 90s, really got a bad rap. It was over-cheesed, over-sauced, over-priced, and people just felt unwell after eating it, he says.

Baker makes a point of explaining that La Solas doesnt offer authentic Mexican food, but rather authentic Californian Mexican food. And while it sells classics like nachos, tacos,

There has been an influx of franchise systems entering the Mexican food scene over recent years, all claiming a unique point of difference and a commitment to fresh, made-to-order meals. Danielle Bowling reports

WAVEMEXICAN

Janine Allis


Mexican|Opportunities

enchiladas and quesadillas, this style is all about the burrito, made fresh to order.

The thing that separates us from them is that, fi rstly, Im from California and secondly, Ive lived and eaten this kind of food for most of my life and I know what is and isnt authentic California-style Mexican food.

Were a fresh mex establishment, which in my book means that you make everything on-site yourself. We offer freshly produced food. We make all the salsas and guacamole and enchilada sauce, everything. The only thing we dont make is the sour cream because we dont have the cows.

Mad Mex, which had 15 stores at the end of the last calendar year, and plans to have a total of 33 by the end of 2013, was also founded by a Californian, Clovis Young, who says the strength of his brand lies in its Subway-like model, where fresh ingredients are on display and put together in front of the consumer when and how they like it.

What we do, I think, is the best quality, but thats not the point. The point is that this is

the Subway model. Its all made in front of you and once people have had the experience of making the choice themselves about what goes into their food, then no one wants to go back to oh, Ill have the chicken burrito like the one in the picture on the wall, he says.

Young believes Mad Mex, founded in December 2007, kicked off the Mexican wave in Australia,

and says that while competition is a good thing, he doesnt believe theres enough room in the market for each franchise to take full potential of Mexican foods popularity.

I dont think theres enough room for fi ve chains to have 100 stores. I think theres enough room for two chains to have 100 stores, he says.

It [Mexican food] does seem like its exploding now, but each

year its been gaining a bit more popularity. And yes, I do believe that because weve been here doing this for the past fi ve years that we are well positioned to be the leader in the next phase when it really takes off and goes everywhere.

We make a super authentic product, something theyve never tasted and the reason is that we bring tonnes of products over

from Mexico. We also have an environment thats fun and cheerful, so its not formal. Its fantastic quality. Its very quick from the time when you order to the time that youre eating its two minutes or less, and its very healthy so you can go there three or four times a week. Plus its cheaper than cooking. So its convenient, its fast, its healthy and it tastes great. All those four things, that

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This is the Subway model. Its all made in front of you and once people have had the experience of making the choice themselves about what goes into their food, then no one wants to go back

La Solas offers authentic California-style Mexican

Fast, fresh and fun food at Mad Mex




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GROWTH STRATEGIESMad Mex isnt the only brand leveraging off the Subway business model. Zambrero, founded in 2005 by Sam Prince, a medical student at the time, has also taken a page out of the popular sandwich franchises book. Like Subway, Zambrero

wants to grow through multi-unit franchising, and the brand, which is expected to have 35 to 40 stores across the country by the end of the year, wants the majority of its franchisees to have between three and fi ve stores each.

Stuart Cook, Zambrero CEO says, [Its based on] wisdom gained from some of the big players like McDonalds and Subway. The reason is that it reduces risk. If something happens to one of their stores it reduces the trading liability of the entire group. It allows greater economies of scale so they can employ the right people and more or less become a business within our business. So as soon as people are starting to go through the [franchising] process, were getting them excited about their second and third store, not just their fi rst.

Cook says each Mexican

franchise in the market today offers something different, and Zambrero plans to grow by capitalising on its own unique offering.

Some of our competitors push the tacky Mexican or the authentic, but were not claiming to be either of the above. Were a Mexican fusion of fl avours, so we used to be called Zambrero Fresh Mex Grill but weve switched to just Zambrero. So we use the essence of Mexican food and some of the spices but we push

Youre not coming there to drink, youre coming there to eat and why not have a beer or a margarita with it?

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for a very Australianised fusion of Mexican flavour.

We have one unique flavour which is a combination of a taco and a soft shell tortilla, which we call a Dos Capas. Its a hard shell taco wrapped in a soft shell

taco. So when you eat a taco it falls everywhere and its really messy but with us you get the soft texture of the tortilla around the outside of the crunchy corn taco, says Cook.

Like Zambrero, Guzman y

Gomez is committed to building a strong network of multi-site owners. There are currently 17 stores, nine of which are company-owned, and co-founder Robert Hazan is adamant that this combination of company-owned sites and multi-unit operators is a formula for success in the crowded Mexican market.

I have no interest in ending up in some giant franchise model that has a long list of franchisees, because this is a very

personal business for Steve (Marks) and I, and we want to

keep it as a very tight family and

Guzman y Gomez promotes multi-unit ownership

An Australianised Mexican flavour at Zambrero




grow with the family, as a small family, says Hazan.Nurturing too many relationships is time consuming and

I think you shouldnt fi x what isnt broken. These people are your business partners. Theyve bought into a company that youve built and you owe them the time and attention that they require at all times.

So with this in mind, Guzman y Gomez is open to bringing on new franchisees over the next 12 months, but from then will limit the opportunity to focus on growing and expanding the existing network.

THE MEXICAN MOODAs any consumer will tell you, theres more to a good eating experience than just tasty food. Friendly service, a broad menu and an exciting ambience all make a difference in creating a loyal fan base.

Guzman y Gomez, which offers both dine-in and food court locations, understands this and tries to serve up a memorable meal experience for all its customers and professional, friendly service is of the utmost importance.

I think people come to us just thinking its a fast food place,

Weve actually had double digit growth in all of our franchise stores since weve taken over. I think the Mexican wave is here because were in that category

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Fresh ingredients are a focus at Mad Mex


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Mexican|OpportunitiesA D _ F R A P P M A Y _ 1 2 . p d f P a g e 1 1 6 / 0 4 / 1 2 , 9 : 0 2 A M

and they leave with such a surprised feeling, like wow this is actually not what I expected at all. The people that work there actually take pride in working there and it filters through. People can see it and feel it. If the staff are happy and are proud of where theyre working and connect with the company then I think that filters all the way through to the customer experience.

Another important part of the customer experience is being able to serve alcohol, which Guzman y Gomez started doing 18 months after it first started trading at the end of 2006.

Theres such an innate association, not just with Australians but in general, with Mexican food and a Corona or a margarita, says Hazan.

I think Australians probably have made the association between Mexican and big groups [of people] and margaritas and things like that, but ultimately it does come back to the food, he says. For us its food first and the alcohol component is great for the business but its an ancillary part to the experience. Youre not coming there to drink, youre coming there to eat and why not have a beer or a margarita with it?

The Burrito Bar, a Queensland-based Mexican franchise is also licensed, and as one of the very few in the category that focuses more on casual dining than takeaway, director Luke McGrath isnt put off by all the other Mexican offerings out there.

Ill let them compete for discount food. Even though I think their food is amazing and I really enjoy those brands food, theyre completely different. What Ive done is take Burrito Bar to the next level, so its a smart casual dining venue with a bar, so theyre all fully licensed. We have a tequila bar in all of our restaurants and we have a margarita cocktail list, with things like a Largarita, which is a Corona-inspired cocktail, says McGrath.

Theyve geared themselves towards volume and as I said, the foods great but its wrapped in foil, see you later, thanks for coming, while were creating the in-house experience, serving things on crockery.

When Franchising spoke with McGrath, Burrito Bar had just opened its fourth Queensland store and was preparing to open two more in Victoria.

By the end of this year Ill have 15 restaurants open and well own this space. While there are gourmet Mexican restaurants out there, were not at that level. Were smart, street, casual dining.

SAFETY IN NUMBERSCompetition is a good thing, as long as the competitors are good quality, says Janine Allis, the woman behind Retail Zoo, the company which operates Boost Juice Bars and three years ago acquired the Salsas Fresh Mex brand, growing it

A friendly, lively atmosphere is important in Mexican dining



from three stores to 30, with hopes to get to 50 over the next two years.

The good news is that the competitors out there are good competitors, which is very good for our category because if all your competitors are really bad, people will go oh I tried that fresh mex and its crap so its really important that if youve got competitors theyre decent competitors. What it does is grow the category, says Allis.

Like its competitors, Salsas prides itself on offering the freshest of fresh ingredients, but what some Mexican

brands arent able to offer, especially in terms of franchisee experience, is the systems and support of such a well-established, successful franchisor.

For example, our IT system we are the benchmark for most people with regards to our online communication, our point of sale, our stock management, our recording systems, there is none better than our system in the back end. We have a high care factor. We have great communication in regards to our franchisees, whether theyre Salsas or Boost, we have cluster

meetings and we recently did a survey on the happiness of our franchisees and we really hit the ball out of the park, she says.

Marketing is a key focus at Retail Zoo, helping Boost Juice go from an awareness rating of zero to 94 percent in fi ve years. If Boost or Salsas comes up with an exciting new marketing campaign that Allis believes will deliver strong results for the company, but the cost of which exceeds whats in the franchisees marketing fund, Retail Zoo will make up the difference.

Because its all very well having a great brand and a great product and great people serving you at the counter, but if no one knows who you are then it takes a long time for word of mouth to get out there before you get known for being all of those great things. We believe in getting people to try us quickly.

And the numbers speak for themselves. Weve actually had double digit growth in all of our franchise stores since weve taken over. I think the Mexican wave is here because were in that category. F

www.FRANCHISe.Net.Au48 | FRANCHISING jul/AuG 2012

The good news is that the competitors out there are good competitors, which is very good for our category because if all your competitors are really bad, people will go oh I tried that fresh mex and its crap

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Franchising Magazine, July / August issue 2012

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Transcript of Franchising Magazine, July / August issue 2012