It’s been a long, difficult tunnel for the past year but you have to say that, for many business sectors, emerging from the darkness is set to be particularly bright.
In March, the Office for Budget Responsibility predicted the UK’s fastest economic growth since 1948 next year.
And as we consolidate our exit from the European Union, there are bound to be opportunities for successful businesses to explore new, international markets.
At The HR Dept, a few years ago we looked to grow outside the UK as our network of franchisees here began to reach its full potential.
In 2017 we officially launched in Australia. It was a challenging yet ultimately successful venture and, in case franchisors are exploring new international markets, I thought I’d share some lessons learned and things to consider.
Does your brand really export?
Of course it’s essential to do your market research before looking to export your brand. You need to know whether there is a gap in the market and customer interest, whether that is in a B2B context or from a consumer point of view.
We spent a considerable amount of time looking to see who else was offering affordable, bespoke HR advice for small businesses in Australia. Likewise, anyone looking to franchise overseas should find what competitors exist, how much demand there is, and so on. And set realistic targets for annual performance, so that both your domestic and in-country teams remain motivated.
The worst mistake to make would be to make an unfounded assumption that, just because there is consistency of language your brand is universally relevant despite variations in cultures, or that it will translate seamlessly across different languages. This has macro implications as well as tangible micro concerns, such as seasonal variations affecting blog content and even whether you have snow on corporate Christmas cards, for example. Each of these comes with a cost.
You should also consider different regulations – for example holiday, wages, pensions – in different countries, which may influence the viability of your existing model.
And of course, bear in mind franchising rules in the country in which you are looking to operate. In Australia, for example, there is the comprehensive, stringent and legally-binding Code of Franchising, which we studied carefully before committing to the venture.
Select your master franchisee carefully
The most important relationship when franchising across borders is between the franchisor and the master franchisee – the person in charge of setting up and managing the business operating under your brand.
Knowledge of the offering is important, of course. But even more vital is an understanding of how to run a business, in particular the nuances of operating a franchise, recruiting and dealing with franchisees.
There’s risk involved in becoming a master franchisee, as well as great opportunity. You should use your own experience of setting up your business to select someone who fulfils all the myriad of demands which will be placed on them.
Can you find suitable sub-franchisees?
In the same way that you’ll research your market before launching, you’ll also need to make sure that you have a pool of potential franchisees who can run the business on the ground.
With us, an understanding of the many high-level HR practitioners who were leaving corporate life and looking to run their own business was key. Likewise, anyone in professional services should be aware of who is out there – the right people with appropriate qualifications and, just like the master franchisee, the right mindset needed to make their new business a success. Of course, the growth in online communication makes that much easier than even few years ago.
The impact on your home business
Be under no illusions of the impact that this new venture will have on your team at home, even with the appointment of a master franchisee. Your head office staff will have new responsibilities, outside their comfort zone, and that will need managing by you, the business owner. Ideally you will have one of your team in country, to get the new endeavour up and running.
Bear in mind also that time difference is a major issue (particularly in Australia!). There will be conference calls and virtual meetings at difficult hours, so prepare your team for that, as well as yourself. And bear in mind the impact that fatigue may have on their normal roles.
Get help
Launching in Australia was one of the most challenging things we have done as a business but we had significant support along the way. When we launched, the Government was running a Passport to Export scheme under UK Trade and Investment, giving small businesses like ours advice necessary for developing an international or export strategy.
We also had external advice from third parties – franchise advice and franchising legal expertise – to help us make sure the joint investment would prove successful. With the strong franchising legislation in Australia, membership of the Franchise Council of Australia also provided helpful guidance.
