And according to Nigel Toplis, there is no better time to move into franchising, which he believes is the most underrated and least understood business model of all.
The last 10 to 15 years has seen a period of huge change in many areas of day-to-day life – such as economic, human migration, globalisation and cultural. Earlier this year we became engulfed in a highly contagious global pandemic and, in the world of business, we have witnessed a growing ‘sophistication’ of the customer.
Customers no longer defer to the supplier. They are more knowledgeable than ever, have consistently become more demanding and they expect a higher level of professionalism than before. In short, they call many of the shots and insist on value for money from suppliers. And the times are changing quickly thanks, unfortunately, to the deadly Covid-19 virus which is sweeping the planet right now – and shows no sign of stopping.
One effect of Coronavirus will be the displacement of employees. Without a doubt, there will be huge levels of redundancies and company liquidations – and probably on a scale never experienced before. At the same time there has been investment in new products and services, and we have all noticed a greater energy in the marketplace.
Manufacturing will find a cheaper cost base and technology will develop at a pace most of us won’t be able to keep up with. All of which brings me to the ever-expanding world of franchising, which has many advantages over other business models. For a start, franchising offers an ideal vehicle for the recycling of large numbers of individuals.
It is the perfect home for those who wish to be their own boss, providing they are prepared to work hard by investing time and money into a new venture. Franchising offers the right people the opportunity to be in control of their destiny and to be rewarded directly for their own supreme efforts. The aim of most people who take the franchising route is to create a level of security not available when working for someone else.
In many ways, franchising is an ideal business model because it offers substantial benefits to all associated parties. The big advantage of being a fledgling franchise business is the knowledge that the franchisor is providing a tried and trusted format for you to become a part of. They have experience, know-how, marketing tools, sales training, technical guidance, as well as a corporate identity, trademarks and the all-important brand.
And because of this extensive support structure available for new budding franchisees, those signing on the dotted line often come from a wide range of backgrounds and experience. Running a franchise is an attractive option for people who already possess a wide variety of transferable skills. These include project management, marketing, operations and sales. Don’t forget, the franchisor’s head office team will help to fill any gaps in the new business owner’s skill set. It is a marriage of skills, work ethic and ambition.
The franchising industry is worth over £17 billion and employs more people than the total number of men and women serving in the UK’s armed forces combined – that is Royal Navy, British Army and Royal Air Force. And yet franchising has the scope to employ many more, as the following statistics will show. In the UK, franchising accounts for only 9-10% of retail sales, compared to 45-50% in the United States.
My big frustration is that universities and colleges give it scant coverage in their business courses. Our numerous centres of learning currently lecture students about how to start their own businesses. They teach them how to research markets, develop a brand and plan marketing campaigns.
Yet most educational establishments effectively ignore a system that provides all these areas of expertise for a new start-up business. There is little recognition in academia for franchising – with the notable exception of Lancaster University. And it is hardly any better within Government. You would think local government would promote franchising as a matter of course.
Franchised businesses potentially have a massive role to play in regenerating town and city centres. It is a proven model designed to assist ‘ordinary people’ to start and build their own businesses. Whenever I try to discuss franchising with local government officials and politicians, all I receive is a blank and confused look.
The key is to try and persuade the UK Government’s Business Secretary (Alok Sharma) to take an interest in franchising and this will only be achieved through a more concerted effort by MPs and the British Franchise Association (BFA), as well as influential members of the franchising community. They must lobby, lobby, lobby, until their voices are finally heard. I look forward to the day when a Government reshuffle creates a new post, that of Minister of State for Franchising. But it’s probably best not to hold my breath!
I’ve been involved in franchising for 26 years and I truly believe it is the ideal path for anyone wanting to start their own business. It creates jobs and wealth, and I can’t understand why this area of business is so often neglected by academia, local councils and Government. Ultimately, of course, it is down to the franchising community to find a more successful way of promoting itself.
They need to champion themselves in the media by creating headlines on a regular basis, whether discussing the plight of small businesses, or policy changes made by Government, or talking about the minimum wage. That said, franchising has come a long way in the UK. We have many well established franchised brands on the high street, servicing millions of satisfied customers. But there’s still plenty of room for growth, and the franchising community must take advantage of this opportunity, despite the current difficulties inflicted on all businesses by Covid-19.
