No Ordinary Blog

Franchising 2025: What’s Next and How Leading-Edge Brands Are Paving the Way

robin@noordinary.co.nz (Robin La Pere) — Thu, 23 Jan 2025 21:59:57 GMT

As a franchise consultant, I’ve had the privilege of working with brands that are reshaping industries and challenging the status quo.

From the adoption of groundbreaking technologies to the reinvention of traditional franchise agreements, the past year has been a proving ground for innovation. As we step into 2025, the question isn’t just about keeping up—it’s about leading the charge.

Let’s explore what the future holds and how some of the most innovative franchises are already paving the path to success.

1. Economic Volatility and Fluctuating Consumer Confidence

What do you do when inflation is easing but consumer confidence is still fluctuating? Many franchises, both large and small, have turned to innovative promotions rather than discounts to lure customers.

McDonald's Monopoly Promotion

Since 1987, McDonald's has successfully run its Monopoly-themed promotion in various countries, including Australia, New Zealand, the UK and the USA. The promotion has become an annual event and is reported to have become the franchise's most effective sales booster.

Domino's 'Emergency Pizza' Promotion

In 2023, Domino's introduced the 'Emergency Pizza' campaign, offering a one-time free pizza to members of their loyalty program. The promotion added millions of new loyalty members, reversing a sales slump with a 2.8% increase in US same-store sales by year's end.

Boost Juice's App-Based Rewards

With stores in New Zealand, Australia and 11 other countries, Boost Juice utilises a mobile app to offer rewards, birthday specials and challenges. Customers earn points for purchases which can be redeemed for free drinks, fostering customer loyalty and repeat visits.

Starbucks Seasonal Promotions

Starbucks uses limited-time seasonal beverages and merchandise to create a sense of urgency and exclusivity. Their most popular seasonal beverage is the Pumpkin Spice Latte, which they promote through a wide range of media, including SMS, micro websites and social media.

2. Increased Adoption of AI and Automation

You've no doubt seen this statement hundreds of times since artificial intelligence became 'the next big thing':

The same applies to businesses, as in: "You won't lose your business to AI. You'll lose your business to a competitor using AI."

Sorry if that sounds rough, but pretty much all of my clients and business contacts have been exploring the benefits of AI for some time now. I've used it to help me research and write this blog. Because franchising is a more complex business model than most small businesses, there is more potential for the use of AI. Here are some examples of franchises of varying sizes integrating AI and automation to enhance operations, improve customer experiences, and drive growth.

RobotLAB is the first and, so far, only robotics franchise

RobotLAB—a business that sells and integrates service robots for various industries such as education, hospitality, and restaurants—has launched a robot franchise programme, a business model that gives franchisees the power to integrate its robots into businesses across the United States. As of January 2025, RobotLAB has 30 locations across the United States and a goal of having approved FDDs in every state.

YUM! Brands expands its AI-powered customer experience

That may surprise you if you've read that McDonald’s has paused its AI-powered automated drive-thru pilot programme after customer complaints about receiving incorrect items such as an ice-cream cone with bacon. But after two years testing drive-thru Voice AI technology, YUM!, the owner of KFC and Pizza Hut, is "confident in its effectiveness in optimising operations and enhancing customer satisfaction.”

AI revolutionising care services at Radfield Home Care

This British franchise that provides live-in support, drop-ins and daycare services has developed a suite of innovative assistive technology devices such as Connected Care to help older people live more independently and safely in their own homes. They also utilise a ChatGPT API which streamlines marketing and HR functions across their 30 franchises.

Want a fresh pizza? Try Sbarro

With 800 franchises and branches across 33 countries, Sbarro is utilising AI to maintain product standards and monitor demand, supply and sales performance, a complex job for one of the world's largest pizza chains. The company said in a Wall Street Journal article that all its corporate-owned locations have been equipped but that it’s still working on helping franchisees to catch up.

3. Customised Franchising Models

The traditional one-size-fits-all model is giving way to greater customisation and hybridisation, enabling franchisors to innovate, adapt to market dynamics, and cater to franchisees’ unique needs. By offering tailored solutions, franchisors can attract diverse investors and thrive in increasingly competitive environments.

The UPS Store offers franchisor-backed financing options

This is common in franchising already but UPS has gone several steps further by offering a range of options to support qualified new and existing franchisees in establishing and expanding their businesses. These options include loans for business acquisitions, equipment purchases, and centre upgrades. The UPS Store has relationships with preferred lenders, providing franchisees with flexible financing solutions.

Franchisors collaborating with Franchisee Associations

If franchisors put in place a platform such as an FAC (Franchise Advisory Council) for franchisees to be heard, operate with transparency and concentrate on both top line and bottom-line profitability, it's unlikely a franchise association will form. But where these associations have been formed by franchisees, many franchisors have now realised the benefits of working with - rather than against - them.

4. Localised and Culturally Specific Models

A friend of mine who is an international business traveller always eats at McDonald's and other global food and beverage franchises because she says she can always trust them to provide the same familar fare wherever she is in the world. For the unadventurous diner, that may be partly true, but for locals, franchises such as McDonald's are smart enough to understand that they must also give locals what they are familiar with, and that means customising their offerings to suit regional preferences.

Different strokes for different folks

7-Eleven modifies its product offerings based on local consumer habits. In Japan, the convenience stores provide a wide range of ready-to-eat meals that cater to the fast-paced lifestyle of Japanese consumers. In India, 7-Eleven stores have introduced local snacks and beverages to meet regional tastes. More recently, the world's largest convenience store franchise has given store managers and franchisees more autonomy to adjust inventory based on local preferences.

Anytime Fitness: A fit for locals

As a global fitness franchise, Anytime Fitness tailors its services to meet local cultural expectations. In various countries, the franchise adapts its fitness programs and facility amenities to align with regional fitness trends and cultural norms, ensuring members feel comfortable and supported in their fitness journeys.

Marriott tailors its hotels to meet local cultural expectations

In the Middle East, Marriott offers gender-segregated swimming pools and dining areas to respect local customs. In Asia, Marriott incorporates Feng Shui, the ancient Chinese philosophy that involves arranging objects, buildings, and space to create harmony and balance. In Nepal, the pictured hotel invites guests to engage with the country's culture through its community ethos and sustainable practices.

Marriott tailors its hotels to meet local cultural expectations

5. Multi-Brand and Multi-Service Offerings

To maximise revenue streams and leverage complementary business opportunities, franchisors often build multiple brands or different services under one umbrella franchise brand.

Creating more millionaires than any other franchise in Australia

That's the Jim's Group claim. Launched in 1994 by Jim Penman (that's him on the logo) in Australia, the franchise is now also in New Zealand and Canada. There are more than 5,500 franchisees providing some 50 different brands, including Jim's Mowing, Jim's Cleaning, Jim's Fencing and Jim's Dog Wash—all beginning with the Jim's name.

Encouraging franchisees to operate multiple brands

Yum! Brands actively seeks franchises and licence partners with prior restaurant or retail experience who aspire to be multi-unit or multi-brand operators. The company owns the KFC, Pizza Hut and Taco Bell franchise brands, and in New Zealand, licenses all three to one company, Restaurant Brands.

Focus Brands now known as Go To Foods

Go To Foods owns a variety of franchise brands, including Auntie Anne's, Cinnabon, Moe's Southwest Grill, and Jamba. This multi-brand approach enables franchisees to serve different customer preferences and market niches, often within the same geographic area, maximising market penetration and operational efficiency.

This is where it all gets confusing

Roark Capital, a private equity firm, specialises in investment in multi-brand, multi-unit franchise brands, including Go To Foods. They acquired Subway for $9.55 billion in 2024. Their strategy is to leverage operational synergies between brands, such as shared supply chains, marketing strategies and technology platforms.

For more on private equity in franchising, check out my article Private Equity in Franchising: A Match Made in Heaven or a Recipe for Disaster?

For franchising, change is here. How the industry responds will shape its future.

Will you lead the change and reap its many benefits—or sit back and watch your franchise or other business lose its competitive advantage to others?

Get on the fast-track to success. Book your free Strategy Consultation with me now .

Will New Franchising Regulations ‘Destroy the Franchise Business Model’?

robin@noordinary.co.nz (Robin La Pere) — Tue, 14 Jan 2025 21:07:51 GMT

McDonald’s certainly thought so.

When the global fast-food giant faced increasing scrutiny under joint employer rules in the U.S., it became a flashpoint in the debate over franchising regulations.

For decades, McDonald’s and similar chains thrived by franchising their operations, creating a network of independent operators under a shared brand. But as governments worldwide introduce new laws to tighten control over franchising practices, the question arises:

Could these regulations dismantle the very foundation of the franchise business model?

The franchise industry has long been held up as a beacon of entrepreneurial opportunity, offering a tested business model for aspiring business owners. But a wave of new laws and regulations across the globe has sent ripples through the franchising community. From Australia’s beefed-up Code of Conduct to the United States’ push for joint employer status, many are asking:

Are these changes necessary guardrails or disruptive overreach?

Plenty of new laws and regulations relating to franchising, either directly or indirectly, have come into force recently. Even in New Zealand, where I am based and where there are no franchise-specific laws but contract, competition and other general business laws still apply, learning from franchise-related legal cases or regulatory updates internationally can help franchisors proactively identify potential legal risks and address gaps in their agreements or operations.

Some of the new regulations and how they may affect franchising

Australia’s Tightened Code of Conduct

I have put Australia at the top of the list because it is reportedly the most regulated franchise environment in the world and I’ve lost count of how many senate and parliamentary enquiries into franchising there have been over the last couple of decades. Surprisingly, Australia is still one of the world's most franchised countries—meaning countries with the highest rate of franchises per capita.

Following an independent review of the Franchising Code of Conduct by Dr Michael Schaper last year, the Australian Government intends to implement all 23 of his recommendations. The new Franchising Code of Conduct will replace the old one on 1 April 2025. Changes will include stricter requirements for disclosure, dispute resolution and financial transparency. While aimed at curbing abuses of power by franchisors, some industry players argue that the cost of compliance could deter new franchisors from entering the market and increase costs for existing systems.

The Joint Employer Debate in the United States and Australia

In the United States, the National Labour Relations Board (NLRB) has revived discussions about joint employer status. If enacted, franchisors could be held liable for labour violations committed by franchisees. Proponents argue this will ensure accountability, while critics such as McDonald’s believe it undermines the independence of franchisees and the very foundation of the franchise model.

In Australia, coffee franchisor 85 Degrees was hit with penalties totalling $1.44 million for its 'systematic failure to ensure compliance within its franchise network'. The Taiwanese-based franchise was held legally liable for underpayments because it should have been a 'responsible franchisor entity' and should 'have known that its franchisees would commit the underpayments and taken reasonable steps to prevent them occurring'.

Source: Employment New Zealand

Although there are no franchise-specific laws in New Zealand, employment laws specify that franchisors have some responsibility for their franchisees' compliance, as described on the Employment New Zealand website.

The European Union’s Franchisee Protections

The EU has introduced stringent guidelines mandating fair contractual terms, increased franchisee autonomy and better access to legal recourse. This has sparked fears among franchisors about losing control over brand consistency and operational standards.

The arguments for and against stronger franchise regulation

Advocates for Regulation

Advocates for these regulations often cite a history of power imbalances between franchisors and franchisees. Reports of exorbitant fees, opaque financials and one-sided contracts have fueled calls for reform. In Australia, for instance, scandals involving failed franchisees and franchise systems have led to a seemingly never-ending stream of probes and enquiries into franchising and an ever-tightening raft of franchise regulations.

Opponents’ Concerns

Critics, on the other hand, warn that these laws could cripple the franchise model. Increased regulatory burdens could make franchising less attractive for potential franchisors, stifling innovation and expansion. In the US, the joint employer rule is seen as a legal minefield that could deter franchisors from providing essential support to their franchisees, out of fear of liability.

Will These Changes Really Destroy the Franchise Model?

The short answer: Probably not, but they could force significant evolution.

Franchising has survived numerous challenges over the decades, from economic recessions to shifts in consumer behaviour. The model is inherently adaptable, and many franchisors are already finding ways to navigate the new regulatory environment. For instance, some are doubling down on technology to streamline compliance, while others are revising their agreements to ensure transparency and fairness.

Lessons from History

It’s worth remembering that similar fears arose during the introduction of franchise regulations in the 1970s in the U.S. At the time, skeptics predicted the collapse of the industry, but franchising flourished. The key lies in finding a balance where regulations protect stakeholders without stifling growth.

Rather than destroying the franchise model, these new laws may serve as a catalyst for reform

By addressing long-standing grievances, the industry has an opportunity to rebuild trust and attract a new generation of franchisees. However, the road ahead won’t be easy, and the adaptability of franchisors will determine how well the industry weathers this regulatory storm.

In the words of Charles Darwin, “It is not the strongest of the species that survives, nor the most intelligent, but the one most responsive to change.”

For franchising, change is here. How the industry responds will shape its future.

Will you lead the change and reap its many benefits—or sit back and watch your franchise or other business lose its competitive advantage to others?

Meaningful, profitable change starts with a free Inital Consultation with me online or by phone.

I have expertise, experience and a track record in helping businesses like yours to get ahead and keep ahead of the game. With revolutionary marketing, systems and recruitment strategies that really work.

Book your free Consultation and get on the fast-track now.

Private Equity and Franchising: A Match Made in Heaven or a Recipe for Disaster?

robin@noordinary.co.nz (Robin La Pere) — Wed, 11 Dec 2024 22:24:56 GMT

$8 billion.

That's the jaw-dropping amount that Blackstone private equity just paid for Jersey Mike's, a submarine sandwich franchise with just 3,500 stores.

I say 'just' because in terms of store numbers and worldwide presence, Jersey Mike's is the bread roll to Subway's footlong. According to Subway's website, they have 37,000+ stores worldwide—10 times more than Jersey Mike's. But Roark Capital acquired Subway in 2023 for $9.55 billion—just 20% more than what Blackstone coughed up for Jersey Mike's.

Did Blackstone pay too much for Jersey Mike's?

And why do so many private equity firms seem to be snapping up franchises? Around 700 of the US's estimated 4,000 franchise brands have been acquired by firms like Roark and Blackstone, according to Alicia Miller in this article in Forbes magazine .

But before you start getting excited about the prospect of making your fortune by selling off your franchise, the same article explains why franchises aren't always a good fit for private equity (PE).

In the article, Alicia Miller explains that PE investors operate on a relatively short-term 'buy-grow-sell' basis. They are risk-averse, looking for good brands with sustainable customer demand and the potential for accelerated growth with PE backing.

That's where Subway, despite its massive scale, fell down.

Here's my analysis of why a relative upstart was able to command a purchase price almost as high as the industry leader—and what you'll need to do to maximise the value of your franchise.

1. Revenue and Sales Performance:

Jersey Mike's: In 2023, the chain reported $3.3 billion in sales, marking a 25% increase from the previous year. And with average annual sales of $1.3 million per store, Jersey Mike's Average Unit Volume (AUV) eats Subway's for breakfast, lunch and dinner.

Subway: While specific figures for 2023 aren't detailed, Subway has faced declining sales and store numbers in recent years, impacting its overall valuation. Its AUV is just $434,000 per year.

2. Market Saturation and Growth Potential:

Subway: With a vast number of outlets, especially in the U.S., Subway's market is considered saturated, limiting opportunities for new store openings and revenue growth.

Jersey Mike's: The brand has significant room for expansion, both domestically and internationally, enhancing its attractiveness to investors.

3. Brand Perception and Customer Loyalty:

Subway: The company has encountered challenges related to brand perception, including controversies and changing consumer preferences, which have affected customer loyalty.

Jersey Mike's: Known for its fresh ingredients, customer service and taste-test superiority, Jersey Mike's has cultivated a strong and loyal customer base.

4. Operational Efficiency and Profit Margins:

Subway: Operational complexities and higher overhead costs associated with a larger number of stores can compress profit margins.

Jersey Mike's: A more streamlined operation with fewer locations can lead to better control over quality and costs, potentially resulting in higher profit margins.

Scale, Consistency and Change:

Subway: With over 37,000 locations worldwide, Subway faces operational complexity that can hinder implementing significant supply, product or service changes. Alicia Miller calls franchising a 'brilliant expansion engine' but notes that 'it’s also notoriously difficult to turn around a stalled-out franchise because change initiatives must be broadly adopted by franchisees'.

Jersey Mike's: Its smaller footprint makes it easier to maintain consistent quality and freshness—and make changes to meet market demand.

Can Subway turn itself around with Roark Capital's help?

Simply throwing money at Subway's problems isn't going to help. The problems go deeper than that. But Roark's management must be confident they can help Subway to do more than just tweaking product offerings and raising standards.

Repositioning: Subway would need to redefine its identity and value proposition. This could include focusing on taste, freshness, sustainability or social impact.

Supply Chain Rethink: Pre-packaged ingredients are more convenient for the stores but less palatable for customers. Subway will need to start thinking fresh, tasty and local in order to match Jersey Mike's at its own game.

Operational Overhaul: Enhancing ingredient quality and preparation methods might mean rethinking its entire kitchen model—a costly and time-consuming effort.

Cultural Shifts: Embracing franchisee relationships and ensuring buy-in for major changes would be essential to sustain growth. As management guru Peter Drucker famously said: 'Culture eats strategy for breakfast'.

Subway’s challenge is not just its product but also the weight of its history, brand perception, operational complexities and market saturation. Jersey Mike’s success demonstrates that consumers crave quality, authenticity and a fresh experience—elements that Subway has struggled to consistently deliver in recent years.

But if Domino's could turn itself around, why couldn't Subway?

This article is Part 1 of a series on Private Equity and Franchising:

A Match Made In Heaven Or A Recipe For Disaster?

To be make sure you don't miss out on Part 2,

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Thinking of Rebranding? Don’t—Until You’ve Read This

robin@noordinary.co.nz (Robin La Pere) — Wed, 27 Nov 2024 20:50:21 GMT

Companies rebrand for all sorts of reasons. Staying relevant in a changing market is just one of them.

You've probably heard about the latest Jaguar rebranding debacle. I call it a debacle because the proposed new logo and brand image has brought a flood of criticism and ridicule from almost everyone.

But Jaguar had to do something.

For the last 102 years, their brand has morphed a few times, but in recent times they have become known as the marque for old men who are trying to project what they saw as an affluent yet sporty image. I knew one of them. To show off his new Jag, he drove me around the backstreets of his upmarket suburb at heart-stopping speed.

He was 75 at the time.

Times have changed.

Despite introducing some pretty cool new models, Jaguar's market has been drying up for years—not to mention dying off. They only built 67,000 cars last year, which was hardly worth opening the factory doors for.

In fact, Jaguar's India-based owners have now closed the factory doors and have stopped selling new cars in preparation for a 'major relaunch' in early 2025. They've hinted at a 'new era' with an all-electric vehicle lineup but there is no hint at what these vehicles will look like.

"Do you sell cars?"

Elon Musk—of course—had something to say about Jaguar's recent rebranding media release and video.

He may have missed the point.

Jaguar’s video—though unconventional—hints at its attempt to position itself as more than a car manufacturer. The colourful visuals and enigmatic tone are likely meant to signal creativity, individuality and a break from the past. These are emotional hooks designed to attract younger, more image-conscious buyers who value the idea of what owning a Jaguar represents as much as its performance on the road.

People these days don't buy products.

They buy brands.

A perfect example of this is Nike. Sometimes you don't even see their shoes in their marketing. But there's no mistaking the brand. Nike's 'Just Do It' ethos embodies empowerment and personal triumph, creating a brand identity so strong that people buy into the lifestyle it represents, not just the shoes it makes.

Tesla has a different branding approach.

Tesla sells innovation and technology. Tesla’s focus on cutting-edge performance, sustainability and Musk’s larger-than-life persona creates its own emotional connection with consumers. But Tesla isn’t immune to branding’s broader principles—it leverages its sleek designs, minimalist aesthetics, and status as a disruptor to position itself as aspirational.

Musk’s jab might reflect his preference for product-driven narratives, but even Tesla thrives because of its brand identity, not merely the cars themselves.

I have been involved in the world of branding and marketing for many years.

That doesn't make me an expert, because I'm learning new things all the time. As all of us must if we're to keep ahead of the game—and understand that branding is about much more than products.

It's about people. It's about your customers. Not just the customers you have now. But the customers you want to have.

Contact me to arrange a free Branding Consultation to talk about your branding or rebranding plans.

This is the first of a series of articles and videos about one of my favourite topics—branding.

Don't miss out on this captivating series! Subscribe to my free email newsletter and get inbox updates every week.

Why Your Search Engine Marketing Isn’t Working—And What To Do About It

robin@noordinary.co.nz (Robin La Pere) — Tue, 26 Nov 2024 22:08:44 GMT

Meet Sarah. She’s the owner of a boutique business in Auckland specialising in handcrafted, eco-friendly candles.

For years, Sarah’s website thrived, attracting customers searching for ‘sustainable candles in New Zealand.’ Her engaging blog posts on candle-making and sustainability consistently ranked high on Google, driving steady traffic and sales.

But recently, everything changed.

Sarah’s website visitors and online orders dried up suddenly and sharply. She ran searches herself and discovered that instead of finding her website near the top of the search rankings, she was now presented with AI-generated summaries and featured snippets that provided answers directly on the search page. Information from her blog was now displayed in these snippets, giving users the insights they were seeking without ever clicking through to her site.

This left Sarah in a challenging position. The strategies that once ensured her business’s online visibility were no longer effective in this new era of AI-driven, zero-click searches. She realised that to sustain her business's growth, she needed to adapt to these changes in online search behaviour.

The Rise of AI in Search

Right now, the many business owners relying on organic search traffic are facing the same challenge. I just made up the ‘case study’ above to illustrate what I've seen really happening out there. The use of AI in search engines has started to revolutionise the way we search online. Aiming to deliver immediate information rather than forcing us to scroll down to find what we're looking for, Google has introduced summarised answers at the top of the search results.

The Impact of Zero-Click Searches

The result is that around 6 in every 10 searches now result in ‘zero clicks’, according to a study by SparkToro in both the United States and the European Union. I’ve found the same thing when I've been searching for information. Why click through to external websites when the information you're looking for is right in front of you?

Here’s an example of what I found when I searched for ‘What is an independent website?’

As you can see, Google presented me with an ‘AI Overview’. But there are link symbols at the end of each paragraph and supporting websites shown on the right of the Overview. So what’s the problem?

Challenges for Independent Websites

Independent websites, particularly those offering product reviews and recommendations, are experiencing a decline in visibility due to these changes. HouseFresh , a site dedicated to air purifier reviews, reported a significant drop in traffic, attributing it to Google’s algorithm updates favouring larger media outlets.

These updates often prioritise content from well-known publishers, even when such content lacks firsthand testing or detailed analysis. I’m not saying that's the case in the screenshot below, but the links on the right are to major media publishers CNET and Wired. I finally found HouseFresh on page 3 of the rankings below.

Adapting to the New Search Landscape

To adapt to the changing search environment, it’s vital to adopt proactive strategies:

Enhance Content Quality: Focus on creating in-depth, original content that provides more value than just basic information. This approach can help differentiate your site from competitors in the 'eyes' of the search engines.

Optimise for Featured Snippets: Structure your content to answer specific questions concisely, increasing the likelihood of being featured in snippets that appear at the top of search results. Use relevant keywords and phrases to show Google you know what you’re talking about.

Leverage Multiple Channels: Diversify traffic sources by utilising social media, email marketing and other platforms to reduce your reliance on organic search traffic.

Stay Informed on AI Developments: Keep abreast of AI advancements in search technology to adapt content strategies accordingly and maintain relevance.

Brand Not Working? Don't Try This.

robin@noordinary.co.nz (Robin La Pere) — Sun, 24 Nov 2024 23:12:00 GMT

If you’re not up with the latest on 102-year-old brand remakes, then you’ll never guess whose rebranding pre-launch teaser this is part of.

The whole video clip may help.

Rebranding a company is a bold move. Done right, it can reinvigorate a business, capture a new audience, and rejuvenate a brand’s identity. Done wrong, it can alienate loyal customers, confuse the market and set the company back years.

Having watched the video clip, what's your opinion? Will this rebrand be a total flop and mean the end of a 102-year-old icon? Or is it the beginning of a new era for a brand which has become tired and in desperate need of saving?

What Does Trump’s Win Mean for Franchising Around the World?

robin@noordinary.co.nz (Robin La Pere) — Wed, 13 Nov 2024 20:58:06 GMT

Donald Trump hasn’t yet taken his place as the 47th president of the United States, but he is already starting to make his mark again on world politics and economies.

He has reportedly started making calls to other world leaders, warning Russia’s Putin not to escalate the Ukraine war and telling Ukraine’s Zelensky – with Elon Musk in the room, strangely enough – that he will continue to support Ukraine.

You may think that because the US has already had four years of Trump, the next four years won’t be much different from the first. But Trump is anything but predictable.

So what can we in the international franchise community expect over the next four years? Because we will certainly feel the impact of Trump’s policies, wherever we are in the world.

Trump built his campaign on beating inflation and the rising cost of living and doing business. Will that happen?

Of course, Trump’s new administration will benefit from the fact that the post-pandemic surge of inflation – caused primarily by the pandemic's disruption of the global supply chain and pandemic relief aid from the government rather than anything Biden could have done about it – is becoming a more distant memory anyway.

US Annual Inflation Rate 2009 - 2024

But while Trump’s policies are intended to bring inflation down further, many economists express concerns that they could have the opposite effect.

Source: What Donald Trump’s Win Means for Inflation. Time Magazine, 11 November 2024

Will Trump’s proposed tax cuts for individuals be good or bad for businesses inside and outside the United States?

Trump has promised tax cuts for individuals, just as he did in his first term as president. And the effects of the new round of cuts for businesses are likely to be similar to the last ones.

Positive Effects for Businesses

Increased Consumer Spending: Tax cuts boost disposable income, leading to higher consumer spending, which drives economic growth

Increased U.S. Imports: Higher US consumer spending can boost demand for imported goods, benefiting foreign businesses exporting to the US

Economic Stimulus: Enhanced spending can stimulate demand, encouraging businesses to expand and hire, potentially reducing unemployment rates

Currency Appreciation: Economic growth may strengthen the US dollar further, making US exports more expensive and imports cheaper, affecting international trade balances

Tax Policy Reforms in Other Countries: In response to the US tax cuts under the previous Trump administration, several countries have reevaluated their tax policies to remain competitive. This has led to tax reforms aimed at reducing corporate tax rates or offering incentives to retain and attract businesses. For instance, some European countries have adjusted their tax structures to prevent capital flight and maintain their appeal to multinational corporations.

Negative Effects for Businesses

Budget Deficits: Reduced tax revenues can increase federal deficits, potentially leading to higher borrowing costs and interest rates. The US already owes a whopping $35 TRILLION and interest payments are reported to be at least $1 trillion per year.

Income Inequality: If tax cuts disproportionately benefit higher-income individuals, income inequality may widen, potentially dampening overall economic growth

Currency Appreciation: I’ve got this effect under both Positive and Negative because any further appreciation of the US dollar will impact US and foreign businesses disproportionately

Global Interest Rates: Increased US deficits can lead to higher global interest rates, raising borrowing costs for international businesses

Source: The Peter G. Peterson US National Debt Clock

How will lower US corporate tax rates affect businesses and franchises outside the United States?

Trump’s promise of cutting corporate tax is obviously good news for businesses in the US, but it puts more competitive pressure on foreign businesses, including franchises.

The Trump administration’s Tax Cuts and Jobs Act (TCJA) of 2017 lowered the US federal corporate tax rate from 35% to 21%, making the US a more attractive destination for business operations. This change has intensified competition for foreign franchises and businesses, as they now face a more favourable tax environment in the US.

Franchises and businesses outside the US now face added pressure to maintain competitiveness with US-based counterparts which may benefit from tax savings. Lower corporate taxes allow US franchises to reinvest savings into areas such as innovation, marketing or expansion, potentially creating a market advantage. Franchises based outside the US may need to find alternative ways to increase efficiencies or consider relocating operations to the US to remain competitive.

Interest rates have already started to come down. Will they come down further?

Interest expenses are a big part of the cost of doing business, especially for franchisees who have just bought in and are building their businesses.

The US Federal Reserve cut its rate from a 20-year high in September and is widely expected to continue reducing it – if inflation continues to decline.

But an inflation flare-up could derail the rate-cutting plans. Trump’s solution? Threaten to fire the chair of the US Federal Reserve, Jerome Powell, and put the Fed under greater government control. Powell’s dismissal would breach long-standing norms of central bank independence. If successful, such a move could have a serious impact on democracy and the separation of powers, with consequences around the world.

Will Trump continue to deregulate business and franchising?

Almost certainly. As a businessman himself, Trump’s stance on business regulation has always centered on reducing restrictions to foster growth and profitability, particularly for small and medium-sized enterprises. For franchising, this could mean:

Easing of Compliance Requirements: Reduced regulatory oversight might lessen compliance costs, potentially lowering barriers for new franchisees in the United States and creating a more attractive environment for US franchisors to expand domestically and franchisors from other countries to enter the US franchise market.

Simplifying Labour Laws: If Trump’s past record is anything to go by, his next administration will continue to support relaxed labour laws, providing more flexibility for franchisors and franchisees in managing employment costs - and potentially lower costs for foreign franchises to enter the US market.

The irony of Trump ‘working’ at McDonald’s as part of his presidential campaign was lost on many people who believed he was simply taking a dig at Kamala’s supposedly ‘fake’ claim that she had worked at McDonald’s as a teenager. They had either forgotten or overlooked that Trump’s former administration had suppressed a push by McDonald's workers to raise their wages. The administration also rejected the National Labour Relations Board (NLRB) attempt to bring McDonald's to the table as a joint employer of its franchisees' employees. I’m sure this would have caused franchisors around the world to breathe a collective sigh of relief at having escaped a new precedent for franchising.

Will Trump’s ‘America First’ policy and higher import tariffs win the war against the US’s trade deficit with China but hurt other countries’ exports?

Trump advocates for imposing high tariffs on imports, particularly from China, to encourage domestic manufacturing and reduce reliance on foreign goods. He suggests a universal baseline tariff of 10% on all imports, with higher rates for specific countries, particularly China.

Why China? Trump – and the US in general – has always seen China as a political and economic threat. The higher tariffs he placed on Chinese imports during his last term in office may have had some impact on the enormous trade deficit the US has with China, but since the beginning of the pandemic the deficit has continued to grow.

US Trade Deficit With China 2001 - 2022

Trump claims that imposing higher tariffs will not raise prices for American consumers, but most economists and analysts beg to differ. They say that US businesses will need to pass the costs of these higher tariffs onto consumers. Analysts estimate that these tariffs could cost typical American households an additional $2,600 annually, according to the Associated Press.

Key Takeaways for Franchisors

Franchisors both inside and outside the United States will benefit from evaluating Trump’s policies and their potential impact on their businesses and franchisees. Proactive measures, such as adjusting supply chains, localising operations or reassessing international expansion plans, can help franchises stay resilient and seize opportunities within a changing global landscape.

As the new administration’s policies unfold, keeping an agile, adaptable approach will allow franchisors to stay competitive and leverage market shifts, potentially setting the stage for a new era in franchising worldwide.

The Smartest Way I've Seen Recently to Attract Top Franchisees

robin@noordinary.co.nz (Robin La Pere) — Wed, 06 Nov 2024 00:00:33 GMT

This guy has, in my opinion, revolutionised the franchise industry with his unique approach to strategic franchisee recruitment and responsible franchising practices.

Just last year, Aaron Harper, CEO and Owner of the Rolling Suds Franchise, awarded franchises for 59 territories across 16 US states, transforming the business into one of the world's largest power washing franchises.

Here's how he's done it.

Educational Videos: Harper shares real-time business strategies through educational videos on social media, offering insights into responsible franchising and business growth.

Social Media Engagement: He maintains an active presence on platforms like LinkedIn and Twitter, posting daily content that discusses franchising best practices and industry trends.

Podcast Appearances: Harper regularly participates in podcasts, sharing his journey and expertise in franchising, thereby reaching a broader audience.

Keynote Speaking Engagements: He delivers keynote speeches at industry events, discussing topics such as responsible franchising and business development.

Media Features: Harper has been profiled in top-tier media outlets like Entrepreneur, Authority Magazine and Franchise Dictionary Magazine, enhancing Rolling Suds' visibility.

YouTube Content: He creates informative videos, such as explaining the franchise sales process to educate potential franchisees. Sometimes he seems to give away his 'trade secrets', which could easily fall into the hands of his competitors or inspire would-be franchisees to start their own independent power washing businesses. But Harper believes that his powerful branding, comprehensive end-to-end operating systems and his strong team approach add more value to prospects than going it alone.

Getting the help of seasoned professionals: Because Harper's background is in a different industry than property maintenance and he was unfamiliar with franchising before acquiring Rolling Suds, one of the reasons for his rapid success was to engage the services of professionals who assisted him in combining his own vision, values and skillsets with those needed to build and grow a thriving franchise organisation.

Franchise your business or elevate your existing franchise with the help of a professional who has 'been there and done that' in franchising and can bring you the smartest and most cost-effective ways to help you grow, no matter where you are in the world.

Is your franchise disclosure document putting prospective franchisees off?

robin@noordinary.co.nz (Robin La Pere) — Tue, 05 Nov 2024 22:17:09 GMT

Picture this: A prospective franchisee, excited about the possibility of joining your franchise, opens your Franchise Disclosure Document (FDD) for the first time.

But instead of finding an engaging, informative document that fuels their enthusiasm, they’re faced with a wall of dense, complex text—a 100-page monolith that feels more like a legal maze than an opportunity.

While compliance is essential, many franchisors miss an important point: the FDD is often the first in-depth look potential franchisees get into your business. But when prospective franchisees are overwhelmed or turned off by dry legalese, they might decide not to pursue the opportunity further. An FDD that is difficult to navigate, devoid of engaging visuals or explanations, and feels like an obstacle rather than an invitation, can make a significant impact on the franchisee’s decision to join—or not.

Do Franchise Disclosure Documents have to look dull, unmotivating and, frankly, scary?

Why Prospective Franchisees Struggle With Standard FDDs

An FDD typically includes essential information, covering everything from the history of the franchise to financial disclosures, legal commitments, obligations, fees, and more. However, it often comes across as an intimidating, overly formal document that feels at odds with the dynamic nature of franchising.

Most prospective franchisees don’t come from legal backgrounds. They’re entrepreneurs looking to build a business. When a document designed to explain the opportunity to them feels daunting, the FDD becomes a barrier rather than a bridge.

The Power of a Visual, User-Friendly FDD

Within the constraints of legal requirements, an FDD can be transformed into a more engaging, accessible document. Instead of relying solely on text, incorporate visual elements to make the document both informative and inviting. Here are some simple ways to achieve this:

Relevant Diagrams and Infographics

Illustrate complex sections with visual aids. For example, consider adding a franchise structure diagram in sections describing the franchise system’s roles and responsibilities. An infographic showing the process and timeline from franchise agreement to grand opening can also clarify the journey for prospective franchisees.

Financial Visuals

Financial data can be overwhelming, especially if it’s a sea of numbers without context. Simplify financial information by providing bar graphs, pie charts, or visual summaries to break down key financial obligations, historical financial performance, and fee structures.

Franchisee Support Illustrations

The support you provide is one of the most valuable assets of your franchise. Use visuals to convey the training, resources, and ongoing assistance offered to franchisees. This can be represented as a roadmap, highlighting support milestones like onboarding, training, and marketing assistance, making it easier for franchisees to understand the support journey.

Visual Storytelling of Success Stories

If your FDD includes case studies or franchisee testimonials, bring them to life with visuals. Incorporate before-and-after photos or quick snapshots of franchisees’ journey to success, making it feel real and achievable for the reader.

Process Flowcharts

Franchising often involves complex processes, such as navigating royalty fees, understanding marketing contributions, or handling equipment leases. Flowcharts can clarify these processes and reduce confusion, making the FDD more accessible to those less familiar with business administration.

Simple and Intuitive Layout

Alongside visuals, the layout of an FDD plays a crucial role. Consider using bullet points, boxed highlights, and consistent formatting to make the document easier to scan. This reduces eye strain and makes information easier to digest. Emphasize sections by using headers and subheadings so that franchisees can navigate directly to sections of interest.

Benefits of a Well-Designed FDD

Making your FDD more visual and accessible serves multiple purposes:

Increased Comprehension: Prospective franchisees are more likely to understand your franchise model, financial obligations, and the support you offer, leading to more informed decision-making

Improved Trust and Transparency: A clear and well-structured FDD demonstrates that you value transparency and the franchisee’s understanding of your business

Enhanced Appeal: Prospective franchisees are likely to view a user-friendly FDD positively, increasing their likelihood of feeling confident about the opportunity

Staying Within Legal Boundaries

Incorporating visuals into your FDD needs to be done thoughtfully and within legal frameworks. You can still ensure that all mandated disclosures and details are present while making the document visually engaging. It’s wise to consult with your legal team to make sure your FDD enhancements comply with relevant franchise laws and disclosure requirements.

Why contract me to revitalise your FDD?

Your FDD doesn’t have to be an impersonal, text-heavy document that puts off potential franchisees. With my combination of franchising experience, legal knowledge and writing and design flair, you can turn your FDD into a powerful tool that not only satisfies legal requirements but also enhances your franchise’s appeal.

By investing in a visual, well-structured and user-friendly FDD, you’re not just informing potential franchisees—you’re inviting them into your brand story in a way that’s clear, compelling, and, ultimately, more effective.

If you want to stand out in the competitive franchise market, talk with me about making your FDD as inviting as your franchise itself . After all, first impressions count, and your FDD might just be the difference between a prospective franchisee moving forward or moving on.

No Ordinary Insights: The Real State of Franchising Around the World

robin@noordinary.co.nz (Robin La Pere) — Wed, 30 Oct 2024 22:28:42 GMT

Every few years, surveys surface that claim to offer a snapshot of the franchising landscape in different parts of the world. These reports are often filled with glossy graphs and impressive numbers like the one below.

Source: Franchising New Zealand 2024 Survey Report by Massey University ( click here to download the full report )

But how much of this data really reflects the realities on the ground?

How useful is it for franchisors and franchisees trying to grow and evolve their businesses?

Do these reports provide actionable insights, or are they too broad and generic to make a real impact?

More importantly, how could the data be improved to help franchise systems not just react to current trends but also anticipate future shifts and innovate accordingly? In a fast-paced global economy, franchisors need more than surface-level statistics—they need deep, meaningful insights that can guide strategy and decision-making.

Could we be missing out on key opportunities to drive improvement and innovation in franchising?

I used ChatGPT to do a deep-dive on State of Franchising Reports for the last 12 years from the United States, Canada, the United Kingdom, China, Australia and New Zealand. And this is what I found.

I asked ChatGPT to start all countries' growth rates at 1 in 2012, making it easier to compare the growth trends across different markets.

I then noticed this paragraph in the Franchising New Zealand 2024 Report:

The thing is that franchising all around the world has been impacted by economic challenges, regulatory complexities (most greater than New Zealand's) and increased e-commerce competition.

So what I want to understand is why the growth rates in franchise unit numbers have declined in New Zealand and Canada when the other countries' growth rates have grown or remained fairly stable?

What happened to all those franchisees?

This is the first of a series of articles on the REAL state of franchising around the world and the trends and innovations that must be embraced if franchisors and franchisees are to move confidently into the future. To make sure you don't miss out on the next articles in the series, follow me on social media or subscribe to my email newsletter .

For the last 25+ years I have been a franchise CEO, franchisor and now a franchise consultant. I love franchising because of the contribution it makes to the world of business and to people's lives. That's why I champion franchising, but because no business model is perfect, I also believe we need to ask questions and gain deeper understandings if franchising is to continuously evolve as it must in order to thrive.

What Team New Zealand’s America’s Cup Win Can Teach Us About Winning in Business in 2025

robin@noordinary.co.nz (Robin La Pere) — Tue, 22 Oct 2024 22:49:10 GMT

Team New Zealand's stunning victory in the 2024 America’s Cup has become a source of inspiration far beyond the world of yacht racing.

The principles that led them to success on the water can serve as powerful lessons for businesses looking to excel in 2025. Here’s what we can learn from their win to help drive success in the competitive business landscape.

1. Innovation as a Game-Changer

Team New Zealand is known for pushing the boundaries of yacht design, constantly innovating to gain a competitive edge. Their 2024 victory was fueled by their cutting-edge technology, particularly in aerodynamics and hydrofoil design. In business, innovation is equally critical. Companies that embrace new technologies, from AI to automation, stand to gain the upper hand by improving efficiency and creating value in ways their competitors can't.

Lesson for business: Invest in research and development and stay ahead of industry trends. Whether you're a franchisor looking to enhance operational efficiency or a startup exploring new markets, leveraging innovation is crucial to staying competitive.

2. Adaptability in the Face of Challenges

In the unpredictable world of sailing, adaptability is key. Team New Zealand faced shifting winds, currents and tough competition, yet they adjusted their strategy on the fly. Similarly, businesses in 2025 will need to stay agile, responding quickly to changes in the economic environment, consumer behavior, and emerging technologies.

Lesson for business: Build an organisational culture that thrives on flexibility. Encourage teams to experiment, pivot when necessary, and be open to rethinking strategies to stay resilient in dynamic markets.

3. Teamwork and Leadership

While technology and innovation are important, Team New Zealand’s success also came down to their strong leadership and cohesive teamwork. Every crew member had a specific role, but it was their ability to work seamlessly as a unit that truly set them apart. The leadership team created an environment where each member could thrive and contribute to the collective goal.

Lesson for business: Foster a collaborative work environment where every employee understands their role in the bigger picture. Strong leadership, clear communication, and a shared vision can align your team and ensure everyone works toward common goals.

4. Precision and Execution

Yacht racing at the America’s Cup is all about precision—split-second decisions, perfect maneuvers and flawless execution. Team New Zealand's ability to execute their strategy with laser focus enabled them to edge out their competitors. Similarly, in business, having a strategy is only half the battle—success comes down to how well you can execute that strategy.

Lesson for business: Prioritise operational excellence. Whether it's improving supply chain management, enhancing customer service or optimising your franchise system, ensure that execution aligns with strategic objectives for long-term success.

5. Staying Calm Under Pressure

The high-stakes environment of the America’s Cup puts immense pressure on teams to perform. Team New Zealand's composure during tense moments allowed them to make smart decisions when it mattered most. In business, the pressure of deadlines, competition, and market shifts can be equally overwhelming, and maintaining focus is essential to making the right choices under stress.

Lesson for business: Cultivate a culture of resilience. Train your team to handle pressure calmly and methodically. This will not only improve decision-making but also keep morale high in challenging times.

6. Working with the Best to Sail into 2025 with Confidence

Team New Zealand's win was its record-breaking third in the America's Cup. New Zealand is only a small and geographically isolated nation compared to all of the other competitors in the iconic race. To me, their victory was a testament to any nation's—or business's—ability, no matter how small, to draw on the best people in their fields into their team. The Team New Zealand team was made up not only of world-class designers, boat builders and sailors, but some of the best in their fields outside the realm of yacht racing. For example, one of the team's cyclors was Hamish Bond, who was not a champion cyclist as you might expect but an Olympic gold medalist in rowing.

Just as Team New Zealand's innovative, adaptable, and team-driven approach led to their triumph in the 2024 America’s Cup, businesses can draw on these same principles to navigate the complexities of 2025. I have a passion—backed by expertise and experience—for helping businesses like yours with the strategic vision, systems, people and flawless execution to win the future. Contact me to get started with a free Initial Consultation .

Will 2025 be a Better Year for Franchising?

robin@noordinary.co.nz (Robin La Pere) — Tue, 22 Oct 2024 22:15:39 GMT

As we approach 2025, the franchising industry stands at a crucial crossroads. Following years of economic uncertainty, shifting consumer behaviours and adaptation to post-pandemic realities, indicators suggest that 2025 could mark a significant turning point for the franchise sector.

The International Monetary Fund (IMF) World Economic Outlook projected a gradual global economic recovery, with growth expected to stabilise around 3.2% in 2024 - 2025. This economic foundation provides a more stable environment for franchise expansion compared to recent years.

Consumer, business and franchise confidence has improved in many countries over the past few months. Inflation, a persistent challenge throughout 2023 and 2024, is predicted to continue to ease, dropping to around 3.9% by 2025. The moderation of inflation will be particularly critical in stabilising consumer spending, a key driver for franchise businesses across sectors like retail, hospitality, and services. A corresponding fall in interest rates is good news for franchise expansion as business borrowing by franchisees becomes more affordable.

"We're seeing renewed optimism in the franchising sector," Catherine Monson, Chair of the International Franchise Association (IFA), noted in the organization's 2024 Economic Outlook. "While challenges persist, particularly around labor costs and supply chain issues, franchise systems have demonstrated remarkable resilience and adaptability."

Opportunities for franchising in 2025

Technology Adoption and Efficiency Gains

As franchisors seek to improve operational efficiency, technology adoption will play a pivotal role in 2025. Generative AI, automation and digital transformation efforts, such as mobile ordering and inventory management systems, are expected to reduce costs and improve franchisee profitability. According to a Deloitte survey, businesses across Europe and North America are increasingly exploring AI-driven solutions to manage operational challenges and reduce labor costs

Deloitte United States.

"The integration of technology into traditional franchise models isn't just a trend – it's becoming a fundamental differentiator," according to Robert Cresanti, former IFA President. "Franchises that successfully blend brick-and-mortar operations with digital capabilities are seeing superior performance metrics."

Health and wellness focus

The rise of health-conscious consumers presents a significant opportunity for franchises to improve performance by embracing health and wellness trends. Franchises in sectors like fitness, healthy eating, and personal care are particularly well-positioned.

But franchises which don't operate in those sectors are also embracing those trends. Fast-food operators and restaurant chains are increasingly offering healthier food and beverage options to align with changing customer values and behaviour. These offerings increase customer retention and often command premium pricing, boosting revenue for franchisees.

And more franchisors are focusing on the mental and physical health of their franchisees as well as their customers, recognising the contribution that wellness-related programmes and counselling make to franchisee performance and satisfaction.

Multi-unit ownership and international expansion

As the economy stabilises, more franchisors are exploring new ways to expand their networks. Some which have traditionally operated single-unit franchisee systems are now offering multiple units or brands to diversify their portfolios. Higher business and consumer confidence and lower interest rates often lead to more aggressive expansion plans for franchise systems, as both franchisors and franchisees are more willing to invest in new locations.

As economies and confidence improve in other countries, domestic franchisors in countries such as China and smaller markets such as New Zealand are now recognising opportunities to explore international expansion.

Expert help to make 2025 your best year ever

I have just returned from Europe and China where I have been working with some of my international clients to develop and improve their business models, systems, capabilities and growth strategies in readiness for what they believe will be a strong year for them in 2025.

As a former advertising executive, marketing manager, franchise CEO and franchisor, I offer advantages that other franchise consultants and coaches don't — more than 30 years' experience in all aspects of franchising, a passion for working with visionary franchisors and their teams, franchisees and customers, and up-to-the-minute insight into innovations, technologies and best practices that are making an impact on franchising and licensing.

Get ready for a better year in 2025 by contacting me to schedule a free Initial Consultation by Zoom, WhatsApp or phone.

Customer Experience is Everything: The Key to Business Success in Any Industry

robin@noordinary.co.nz (Robin La Pere) — Wed, 16 Oct 2024 23:20:10 GMT

In this article:

Why Customer Experience matters more than ever

How to improve Customer Experience: Proven strategies from industry leaders

Why it’s not just about better technology

Unique Business Models that redefine customer experience: How one franchise makes CX ‘the best damn part of your day’

I was having a glass of wine with a friend, a former client of mine, when the subject of customer experience came up.

My friend owns the largest home-grown new home building brand in the country and he said unequivocally that the quality of the customer experience is the biggest battlefield in an industry with one of the longest sales processes of any industry.

“It can take as long as three years from the sales and marketing stage through to construction, completion and handover,” he explained. “And at the end, it’s the quality of the whole customer experience that matters most to our business.”

Why Customer Experience Matters More Than Ever

The power of customer experience lies in its ability to directly impact a business’s bottom line. According to a 2023 study by PwC, 73% of consumers say that a positive experience is one of the most important factors in their purchasing decisions. Meanwhile, businesses that lead in CX outperform competitors by 80% in revenue growth. Simply put, providing a memorable, frictionless experience can drive higher customer retention, brand loyalty and profitability.

Consumers and business buyers now have more choices than ever before, and they are not just looking for great products or services—they want personalised, seamless experiences. When companies fail to deliver, customers are quick to move on. On the other hand, businesses that exceed expectations can transform satisfied customers into loyal advocates.

How to Improve Customer Experience:

Proven Strategies from Industry Leaders

Here’s a step-by-step guide on how to improve customer experience and examples of businesses that have successfully implemented these strategies to gain a competitive edge:

1. Understand Your Customers Through Data

To deliver exceptional customer experiences, you need to understand your customers’ needs, preferences and pain points. This requires collecting and analysing data at every stage of the customer journey.

Case Study: Amazon’s Data-Driven Personalisation

Amazon is a prime example of using data to enhance CX. By leveraging algorithms and machine learning, Amazon tailors product recommendations for each user based on their browsing history, previous purchases, and even what similar customers have bought. This level of personalisation has significantly improved customer engagement and increased sales.

In fact, 35% of Amazon’s sales come from its recommendation engine.

How You Can Do It:

Implement customer feedback systems (surveys, reviews) to collect data on customer preferences

Use data analytics tools to track customer behavior and personalise interactions

Consider investing in CRM (Customer Relationship Management) systems to keep track of customer touchpoints

2. Simplify and Streamline the Customer Journey

Customers value simplicity and convenience. The fewer the obstacles, the more satisfied they will be. Optimising each touchpoint for ease can greatly enhance the overall experience.

Case Study: McDonald’s AI-Powered Drive-Thrus

McDonald’s has simplified the drive-thru experience by integrating AI to personalize menu suggestions based on factors like time of day and weather. By reducing decision fatigue and speeding up the ordering process, McDonald’s has improved both customer satisfaction and operational efficiency.

Their AI initiative helped increase digital sales by 20%.

How You Can Do It:

Map out the customer journey to identify friction points

Streamline processes, such as checkout and customer service interactions, to reduce complexity

Offer self-service options like FAQs, chatbots, or mobile apps for convenience

3. Leverage Technology to Enhance CX

Digital tools like artificial intelligence (AI), augmented reality (AR), and mobile apps can revolutionise the way businesses interact with customers, offering personalised, real-time solutions that enhance the overall experience.

Case Study: Sephora’s Augmented Reality Experience

Sephora has transformed the beauty shopping experience with its Virtual Artist app, which uses AR to allow customers to try on makeup virtually. This not only makes the shopping experience more interactive and fun, but it also reduces the uncertainty of purchasing cosmetics online.

This innovative tool has led to increased online sales and reduced product returns.

How You Can Do It:

Use AI chatbots to offer instant responses to common customer inquiries

Explore AR and virtual reality (VR) solutions to enhance product try-ons or virtual tours

Implement mobile apps to give customers easy access to your services, such as order tracking or appointment scheduling

4. Invest in Employee Engagement

Employees play a crucial role in delivering excellent customer experiences. A disengaged workforce can have a direct negative impact on CX, while motivated and empowered employees are more likely to provide positive interactions.

Case Study: Ritz-Carlton’s Employee Empowerment

Ritz-Carlton is renowned for its luxury customer service, largely due to its policy of empowering employees. Each employee is authorized to spend up to $2,000 per guest to resolve any issue and ensure the guest leaves satisfied.

This level of empowerment builds a sense of ownership among employees, leading to superior service and creating loyal customers who are willing to pay a premium for the experience.

How You Can Do It:

Provide regular training programmes focused on improving customer service skills

Empower employees by giving them the tools and authority to resolve customer issues on the spot

Foster a company culture that rewards excellent customer service, whether through bonuses, recognition, or other incentives

5. Personalise the Customer Experience

Personalisation is key to making customers feel valued. From customised recommendations to personalised communication, businesses which tailor their interactions with customers are more likely to foster loyalty and trust.

Case Study: Netflix’s Personalised Content Recommendations

Netflix has mastered the art of personalization through its advanced algorithm, which suggests content based on each viewer’s preferences, viewing history, and habits.

This level of personalisation has not only made Netflix more appealing but also reduced churn, with 75% of viewer activity driven by personalised recommendations.

How You Can Do It:

Personalise emails and marketing communications based on customer data

Offer product or service recommendations tailored to individual customer needs

Use CRM tools to keep track of customer preferences and follow up with personalised offers

How one franchise makes CX ‘the best damn part of your day’

Case Study: Combining Grooming and Social Experience

Scissors & Scotch is a prime example of how blending seemingly unrelated concepts—grooming services and social environments—can create a standout customer experience. Launched with the goal of offering men more than just a haircut, Scissors & Scotch provides an innovative mix of grooming services and a cocktail lounge, turning a mundane task into a luxury, experience-driven service.

The key to their success is the membership model that prioritises customer engagement and loyalty. Members not only receive premium grooming services but also enjoy access to the lounge, complete with drinks, making it more of a social experience than a routine haircut. By providing a unique combination of high-quality grooming and relaxation in an upscale environment, Scissors & Scotch has positioned itself as more than a barbershop—it’s a lifestyle brand.

How You Can Do It:

Consider offering bundled services that complement your core offerings, turning routine transactions into enjoyable experiences

Explore membership or subscription models to foster long-term loyalty and engagement

Create a space that feels inviting and encourages customers to stay longer, even after their primary transaction is complete. This can help build a sense of community and connection with your brand

Now is the time to evaluate and elevate your customer experience strategy

Get started on your journey to transform your business and unlock new opportunities for growth. Contact me for a free, no-obligation Customer Experience Consultation by phone or on Zoom, WhatsApp or WeChat .

Remember, CX isn’t just something you do—it’s everything when it comes to achieving lasting business success.

Creative Financing: Innovative Ways to Help Prospective Franchisees Get Started

robin@noordinary.co.nz (Robin La Pere) — Wed, 02 Oct 2024 22:40:28 GMT

It happens to us all – you find a prospective franchisee who seems ‘right’ in every way, except one. Access to capital.

As a former franchise executive, then a successful franchisor and now a franchise consultant, I’ve seen firsthand how financing solutions can make or break a franchise deal. With traditional bank loans often falling short for aspiring franchisees, franchisors who offer innovative funding options gain a significant competitive edge in attracting top talent.

Let’s explore some alternative approaches to help your prospective franchisees get started.

Financing: The primary barrier to entering the franchise industry

In a study conducted by FRANdata, 35% of prospective franchisees cited financing challenges as the primary barrier to entering the industry.

According to the International Franchise Association (IFA), around 62% of franchisees struggle with financing, particularly when they are new to the franchise world.

Franchisor-Sponsored Financing

One of the most straightforward ways for franchisors to help is by offering direct financing. This can take several forms, including financing part of the franchise fee or offering loans for initial fit-out costs.

Example 1: The UPS Store, which has an internal financing program that helps franchisees with initial franchise fees. According to their franchise development team, this programme has allowed more qualified candidates to join the network, increasing their growth rate.

Example 2: In my experience as a franchise consultant, I’ve helped franchisors develop similar programmes. I have recently worked with a food and beverage franchise in creating an installment payment plan for their franchise fees which allowed new franchisees to spread payments over a three-year period. This not only reduced the financial burden upfront but also created a longer-term relationship between the franchisor and franchisee.

Example 3: I am currently working with a bank which is willing to provide capital finance to franchisors which can then be used to finance franchisees into their franchises. Subscribe to my newsletter for updates.

Partnership with Third-Party Lenders

Many of my clients have already developed partnerships with third-party lenders who specialise in franchise financing. These include a number of banks which are familiar with the specific financial models of franchises and often have more flexible loan terms, including in several cases, up to 50% without collateral for established franchises.

FranFund and ApplePie Capital are two well-known franchise lenders that work closely with both franchisors and franchisees to provide financing solutions tailored to the franchise business model. ApplePie Capital, for example, offers custom loan products that work with the growth timeline of a franchise, so franchisees aren’t overwhelmed with payments before they are generating solid cash flow.

One client of mine, a multi-location fitness franchise, successfully partnered with a major bank to offer a financing solution that reduced the repayment burden for franchisees during the first year of operation. This resulted in a 20% increase in the number of franchisees who were able to open locations within a year of signing their franchise agreement.

Vendor Financing and Leasing Options

Vendor financing involves suppliers of equipment or other essential items offering financing options for franchisees. This is particularly common in industries with high equipment costs, such as quick-service restaurants (QSR) or automotive repair franchises. Franchisors can negotiate lease-to-own options with vendors on behalf of their franchisees, reducing the upfront burden. This allows franchisees to get the necessary equipment while spreading payments over time.

As a franchise consultant, I’ve also helped franchisors to finance or lease premises, fitouts and equipment directly to their franchisees, significantly reducing the upfront costs of entry for franchisees while providing franchisors with additional income streams and compliance capability.

Shared Risk Models

Franchisors who want to be truly innovative might consider a shared risk or joint venture model, where they invest alongside franchisees. For example, a franchise may reduce the initial franchise fee or take an equity stake in the location, with the franchisor providing capital and expertise in exchange for a share of the profits. This model isn’t for everyone, but it demonstrates a franchisor’s confidence in the success of its franchisees.

Industry Trend: The International Franchise Association's 2024 Franchise Business Economic Outlook reports a 15% increase in franchisor equity partnerships over the past two years.

Example: A large U.S. restaurant chain used this approach in select underpenetrated markets, offering to co-invest with franchisees to stimulate growth in those regions. This strategy led to 15 new stores opening within a year in previously untapped markets, creating a win-win scenario.

Leverage of Retirement Funds

Did you know that many prospective franchisees can tap into their retirement savings to fund a franchise without incurring penalties? In the United States, this method, known as Rollover for Business Startups (unfortunately shortened to ‘ROBS’), allows individuals to use 401(k) or IRA funds to invest in a business.

Several other countries also offer the opportunity for investors in retirement and superannuation funds to access part of their fund for franchise or business startups. In New Zealand, the National Party promised to allow up to $20,000 to be withdrawn from Kiwisaver accounts for this purpose, but the new government has yet to fulfill their promise.

How I can help you grow your franchise

with better franchisee financing options

As a franchise consultant, I work with franchisors to develop and implement a range of financing solutions. My services include:

Assessing your franchise system’s financial needs and capabilities
Designing custom financing programmes that align with your growth strategy
Developing partnerships with lenders, equipment lessors, and other financial institutions
Creating legal frameworks for in-house financing programmes
Training your franchise development team on how to present and leverage these financing options

By offering innovative financing solutions, franchisors can significantly expand their pool of qualified candidates, accelerate growth, and build stronger relationships with their franchisees. Remember, the key to successful creative financing is finding the right balance between lowering barriers to entry and maintaining the quality and commitment of your franchisees.

Contact me, Robin La Pere, on robin@noordinary.co.nz or use this form to arrange a Free Franchisee Financing Consultation.

How to Supercharge Your Franchisees’ Sales (And Your Royalties)

robin@noordinary.co.nz (Robin La Pere) — Mon, 30 Sep 2024 21:41:05 GMT

Franchise systems live or die by the success of their franchisees. A thriving franchise network means more sales, happy franchisees and a growing stream of royalties for the franchisor.

But how do you, as a franchisor, help your franchisees supercharge their sales and, by extension, increase your royalties? The answer lies in strategic growth initiatives that focus on scaling performance across all aspects of the franchise business.

In this article, I'll provide real examples of franchisors who have empowered their franchisees to double, triple and even 10X their sales—and how they did it, leading to a win-win for everyone in the system.

1. Data-Driven Performance Management

Data doesn’t lie, and smart franchisors know that tracking performance metrics is critical. If you're not already using data analytics to monitor franchisee performance, or if the only metric you're tracking is franchisee sales, you're missing out on a significant opportunity to boost your own revenue.

Case Study: Why McDonald’s always seems to recommend your favourites

McDonald's, once famous for mass-marketing, are now in the business of mass-personalisation. By gathering information from drive-thru kiosks, mobile app and digital menus on customer behaviour, order history and menu items, they are able to predict customer preferences and adjust their menus accordingly, moving purchase decisions away from the counter, speeding up sales and increasing revenue-per-customer.

To advance this algorithmically-driven ‘decision logic’ technology in its own stores, McDonald's even bought a tech startup, Dynamic Yield, which also provides its Machine Learning services to retailers such as Ikea and Sephora. They later sold the company to Mastercard for a reported $127 million profit (but they still use its services).

You don't have to buy a tech company to better utilise data to drive sales growth. There's plenty of amazing data-driven performance management technology available for smaller franchise systems—and I can help you identify and implement the right ones for you.

Key Metrics Monitoring: The first step is to identify your most important key performance Indicators (KPIs)—sales per square foot, average transaction size, repeat customers, local marketing spend, etc. These are the metrics that drive your franchisees' businesses as well as your franchise as a whole. The next step is to track these metrics and e stablish a dashboard which enables franchisees—and you—to see what’s working and where adjustments are needed.

Benchmarking Success: As a franchise consultant, it always baffles me why so many franchisors don't seem to recognise the benefits of benchmarking. Compare your top-performing franchisees with those that are struggling. Highlight what the top 20% are doing differently and share those insights across your network. This open sharing of data motivates the team to do what they do with the success of the whole franchise and encourages friendly rivalry between them.

Personalised Coaching: Use data to identify which franchisees need additional coaching and support. Provide actionable steps to help them improve, from optimising inventory to refining customer service practices.

2. Hyper-Local Marketing Strategies

One of franchising's 'secret weapons' is the combination of national and local marketing that most franchise agreements stipulate. But many franchisees don’t fully utilise the power of localised marketing. National campaigns can generate brand awareness, but hyper-local marketing can drive immediate foot traffic and sales.

Case Study: Hell Pizza taking hyper-local marketing to the streets

If you haven't heard of Hell Pizza, then you probably don't live in New Zealand. This upstart franchise used provocative and often controversial branding and marketing to catapult itself into third place as the largest pizza chain in the country after Domino's and Pizza Hut. A big part of their success has been their hyper-local marketing strategy, encouraging their franchisees to 'live and breathe' their unique brand. This meant that franchisees were free to trick out their own stores and use direct marketing and quirky events to target local markets. One franchisee even bought and branded an old black hearse which was occasionally used for delivering pizzas and was always parked in high-traffic areas.

Here are some other ways your franchisees can hyper-localise their franchise marketing:

Leverage Local SEO: Ensure each franchisee’s location is optimised for local search. Encourage franchisees to claim their Google My Business page and regularly update it with promotions, events and positive reviews.

Community Involvement: Encourage franchisees to get involved with local events, charities or sports teams. Customers love businesses that invest in the community. Think about sponsoring local youth sports or hosting in-store events that connect with neighborhood causes.

Targeted Social Media Campaigns: Train franchisees to use social media ads targeting their immediate geographic area. Platforms like Facebook and Instagram allow hyper-targeting, meaning ads can focus on potential customers within a certain mile radius.

3. Upskilling Franchisees and their Teams

When speaking at franchise conferences, I often ask the franchisees how many books they've read or courses they've taken in essential business practices such as marketing and selling. Usually only a handful of hands go up. A well-trained team can be the single most powerful lever for increasing sales. If your franchisees

and their teams aren’t continually improving their skills, you’re leaving money on the table. But even franchisors which provide excellent ongoing training for their franchisees often forget that their franchisees' people need training too and neglect to 'train the trainers'.

Case Study: Signature Homes' revolutionary sales management process

Although I am based in Auckland, New Zealand, I work with franchises all over the world, but of course many of these are based in my home country. Signature Homes is one of these. Since I started working with them in 2000, they have risen from a small specialist home-building franchise into New Zealand's largest home-grown building brand. One of the keys to that success was to recognise that Signature's franchisees were builders, not sales people. They all employed commission-based sales people to do the selling for them, but not being experienced in selling themselves, had little idea of how to effectively manage their teams. That's when Signature's owner and I had a brainwave—instead of trying to train the franchisees in sales management, why not employ a National Sales Manager to train, motivate and support the franchisees' sales people on their behalf? I happened to have recently met a person who I felt fitted the bill perfectly. He is pictured at left in the photo above with my wife and me at Signature Homes' 40th Anniversary Dinner, celebrating 20 years with the company and an 10X increase in Signature's franchisee sales over that time.

Here are some other ways you can upskill your franchisees and their teams:

Treat learning as an important ongoing process: I've seen too many franchisors who provide their franchisees with initial training and a manual—and that's it. Best-practice franchises go several steps further, providing their franchisees, their franchisees' employees and themselves with continual upskilling and development opportunities.

Training Bootcamps: Host regular training workshops for your franchise support team as well as your franchisees and their teams. Bring in expert trainers and coaches to teach specialist skills. Remember that no matter what roles trainees may play, everybody in your organisation is a sales person—so make sure your operations people as well as your sales people always treat customers as the most important people they deal with and always look for opportunities to up-sell and cross-sell.

Product knowledge is key: Ensure franchisees ad their teams are fully educated on your product or service offerings. Customers trust knowledgeable staff, and being able to answer questions confidently can lead to better sales.

Incentive Programmes: Encourage your franchisees to motivate their employees by setting clear objectives and using incentives to reward them for achieving their objectives. Do the same with your own franchise sales and support team. Some franchisors also use a scaled royalty system to incentivise higher sales from their franchisees. The higher the sales, the lower the royalty percentage at each growth level.

4. Operational Efficiency and Technology Adoption

I have found that there's a lot of confusion about systems in the franchising industry. Some believe that it's enough to provide their franchisees with an operations manual outlining how their franchised businesses should work. Others believe that only advanced technology will give their franchises an edge.

They're both right, and they're both wrong. In franchising, systems are the structured, repeatable processes or methods which are essential for ensuring that the business model is replicated consistently across multiple franchise locations. For many established franchises, the foundational systems they developed years ago continue to serve as the backbone of their success.

So what's changed? Let's look at McDonald's again.

At its core, McDonald’s franchisees are still doing the same thing they were 50 years ago: making and serving hamburgers, fries and other fast-food items. The process of assembling a burger, cooking up the fries and preparing drinks hasn’t fundamentally changed. The franchise’s core menu offerings, service models and kitchen workflows have remained remarkably consistent.

So what has changed? How has McDonald’s been able to remain in the forefront of operational efficiency and global dominance?

A big part of the answer lies in their adoption of technology and other modern tools. Today, McDonald’s utilises advanced software for inventory management, reducing waste and ensuring stores are always stocked with fresh ingredients. Artificial intelligence is employed in drive-thru operations to predict orders and improve speed of service. Mobile apps have transformed how customers interact with the brand, allowing them to place orders and pay from their phones before arriving at the restaurant or to have their orders delivered to their homes or workplaces. In some locations, robotics are being tested for cooking and preparation tasks, further optimising the kitchen workflow.

These tools have enabled McDonald’s to serve millions of customers daily with unprecedented efficiency, but the core system that made them successful—quick, standardised food service—remains largely the same as it was during Ray Kroc’s time. The difference is not in the systems, but the tools which make the systems work better.

The lesson here for franchisors is clear: you don’t necessarily need to overhaul your systems to stay competitive. Like McDonald’s, the secret to sustained success may lie in using new tools to refine and optimise your existing systems. Implementing the right tools can reduce inefficiencies and allow franchisees to focus more on delivering a top-notch customer experience. Here are some examples:

Point of Sale (POS) Technology: Modern POS technology can integrate inventory management, customer relationship management (CRM) and sales tracking all in one place.

Inventory Management: Equiping franchisees with real-time inventory management tools helps them to manage stock more efficiently, avoiding stockouts or excess inventory.

Automation: Software and apps which automate repetitive tasks such as scheduling, payroll, invoicing and credit control free franchisees's time up to focus on productive tasks such as marketing and sales.

5. Foster a Culture of Innovation and Support

As a franchisor, your long-term success depends not only on the strength of your business model but also on the culture you foster across your franchise network. Developing a culture of innovation and support—both for your franchisees and your own support team—can be the game-changer that ensures sustained growth, operational excellence and a competitive edge in today’s evolving market.

Examples of franchisees who made their franchisors richer

This is Jim Delligatti, an early McDonald's franchisee and inventor of the ... you guessed it. Delligatti came up with the concept of the Big Mac in 1967 and started selling them for 45 cents. The cost of a McDonald's hamburger at the time was 15 cents so by adding an extra patty and layer of bread, Delligatti was able to triple his revenue from the new product and probably 10X his profit. McDonald's founder Ray Kroc knew a great opportunity when he saw one and by 1969, the Big Mac was available in all McDonald's stores and accounted for accounted for 19% of total sales. Delligatti reportedly said that he had received no royalty payments for the creation of the Big Mac, but had received a plaque. He ended up owning 48 McDonald's stores.

A surprising number of the McDonald’s core menu items was created by franchisees. Franchisees created the Filet O-Fish, the McFlurry and Breakfast Burritos. In 1972, Herb Peterson, who operated six stores in California, put an egg, cheese and Canadian bacon between an English Muffin. The Egg McMuffin would become a centerpiece of McDonald’s new breakfast rollout. Today, breakfast is more than a quarter of the chain’s domestic sales, or more than $10 billion in U.S. sales annually.

Subway, KFC, Wendy's, Dairy Queen and many other franchise giants all tell legends of how franchisees came up with innovations that helped them refine and refresh their business models.

Here are some ways that best-practice franchisors encourage continuous improvement and innovation from within their organisations—and from outside:

Create a Franchisee Innovation Hub: Establish a forum where your team and franchisees can share new ideas, innovations or local promotions that have been successful. Reward creative thinking, and highlight those who come up with the best strategies. Often bringing in an independent third-party facilitator such as myself can encourage more open discussion and brainstorming.

Ongoing Support and Mentorship: Franchisees who feel supported are more likely to succeed. Provide continuous training and support, whether through virtual coaching, peer mentorship programmes or regional meet-ups.

Test and Scale: Once an innovative idea has been tested and proven in one franchise location, roll it out across the network. Whether it’s a new product, service enhancement, or a unique marketing tactic, scaling successful initiatives can have a tremendous impact on sales growth system-wide.

5. Franchisee Financial Health and Growth Planning

A franchisee struggling financially won’t be able to invest in growth. Help your franchisees stay financially healthy by offering tools and resources to optimise their cash flows and reinvest in their businesses.

Here's an inspirational example of how Jim's Group built Australia's largest franchise by helping its franchisees to grow their businesses and remain financially healthy.

Case study: The cleaning franchisee who cleaned up in Australia

With more than 5,400 franchisees, Jim's Group is the biggest franchise in Australia and has expanded into New Zealand, Canada and the UK.

Pictured above is Haydar Hussein. In 1994, Hussein launched his own cleaning business, and within just six months, it was thriving. However, after six years of growing the company and refining his expertise, he realised that turning his business into a national brand was financially out of reach. Determined to leverage his industry knowledge, he began exploring new opportunities. His search led him to Jim’s Group, a well-established franchising giant with a proven brand and system.

Hussein saw potential in partnering with Jim’s Group and decided to purchase a regional franchise for Jim’s Cleaning in Western Melbourne. He rebranded his existing business under the Jim’s Cleaning banner, and from there, his success story truly began.

In just three years, Hussein expanded his reach, acquiring the remaining regions nationwide, giving him full ownership of the Jim’s Cleaning franchise network across Australia. Now serving as the National Franchisor for Jim’s Cleaning, Haydar is dedicated to continued growth, aiming to surpass even his own original expectations.

Want to grow your franchise like Jim Penman did with Jim's Group? Recruit and work with smart and ambitious franchisees like Haydar Hussein and support them with:

Financial Health Check-ins: Regularly review franchisees’ financials, looking at everything from profit margins to cost controls. Offer guidance on how they can reduce expenses, negotiate better deals with suppliers, and improve cash flow.

Growth-Focused Business Plans: Work with franchisees to create growth roadmaps that focus on scaling their operations over time. Whether it’s opening a second location or adding new revenue streams (such as delivery services or online sales), a clear plan will guide them toward sustainable growth.

My mission: To help franchisors like you to grow

My name is Robin La Pere (that’s me in the photo about to board the Eurostar) and as well as being a franchise consultant and coach, I have managed corporate franchises and started and owned my own franchises. Which means I understand exactly what you’re going through as a franchisor, franchise executive or business owner considering expansion through franchising or licensing.

There are many reasons to hire me to help you franchise your business, improve your existing franchise or accelerate your franchisees' growth:

Free Initial Consultation: This gives us the opportunity to get to know each other at no cost or obligation. Once I have gained a better understanding of your business and goals (treated in strictest confidence, of course) I will be able to explain some of the ways I could add value to your business and help you find the solutions you are looking for.

Start Small or Big: Most of the work I have done with my clients has started as a small project and grown into a longer-term kind of partnership once they have seen the results we have been able to achieve together.

Strategic Approach: I know from my own experience how hard it can be when you're involved in the day-to-day operation of your franchise to see beyond your immediate needs and visualise the big picture for the business. That's where I come in, offering what I like to call a 'fresh pair of eyes' to spot opportunities you may have missed. I also take a holistic approach, understanding that growth doesn't just come as a result of one activity but a range of interconnected activities. For example, the best sales and marketing in the world won't be effective if your people, systems and supply chain can't keep up with demand.

Affordability: To make the costs of my professional services as cost-effective as possible, I work differently from many other professionals. Instead of employees, I work with a virtual team of specialists in fields that may be outside my field of expertise. I turn to these only when required, which allows me to offer you comprehensive services without high overheads. And I really do pass the savings on to you. I also use proven systems, AI and automation to speed up and take cost out of my processes.

The Rise of Startups and What That Means for Franchising in 2025

robin@noordinary.co.nz (Robin La Pere) — Mon, 23 Sep 2024 22:25:45 GMT

In recent years, the entrepreneurial landscape has witnessed unprecedented growth, with record numbers of startups emerging globally. This surge has significant implications for various sectors, especially franchising, which must adapt to address emerging challenges and capitalise on new opportunities.

The Startup Boom: An Overview

The Post-Pandemic Boom is Continuing in the US

Source: Why More Americans Than Ever Are Starting Small Businesses from data provided by the Federal Reserve Bank of Saint Louis

The pandemic years saw a dramatic increase in business formations. In 2021 alone, over 5.4 million new business applications were filed in the United States, marking a 20% increase from the previous year. And the trend was not isolated to the US — around the world, countries saw similar spikes in entrepreneurship.

In 2024, while the growth has slowed somewhat, new business numbers are still at historic highs.

What has fuelled this growth?

Remote Work Flexibility: The rise of remote work has lowered entry barriers, allowing more individuals to launch startups without the overhead of physical offices.

Technological Advancements: Innovations in technology have made it easier and more cost-effective to start businesses, particularly in e-commerce, software development and digital services.

Shift in Consumer Behaviour: The pandemic shifted consumer preferences toward online shopping and digital services, creating opportunities for startups that cater to these trends.

Rising Unemployment Rates: After hitting record lows in many countries, unemployment is on the rise again, prompting many of those laid off to start their own businesses.

The Impact on Franchising

As the number of startups continues to rise, franchising is experiencing new opportunities as well as challenges:

1. Increased Competition

With more startups entering the market, franchisors face greater competition. This forces existing franchises to innovate and differentiate themselves, whether through improved customer service, unique offerings or enhanced branding strategies. For example, established brands may need to adopt more flexible business models or expand their product lines to stay relevant.

2. Emergence of New Franchise Concepts

The startup boom has led to the creation of novel business models that can be franchised. Concepts that were once the domain of solo entrepreneurs, such as food trucks or mobile services, are now being structured as franchises. This diversification expands the range of options available to potential franchisees, allowing them to choose from innovative and trendy concepts that resonate with today’s consumers.

3. Access to Funding and Resources

With the influx of startups, there is also an increase in available funding sources. Venture capital, angel investors and crowdfunding platforms are now more accessible, enabling aspiring franchisees to secure the necessary capital to start their businesses. Franchisors can also benefit from this trend, as many are increasingly looking for franchisees who can bring new ideas and local insights to the table.

4. Focus on Technology and Digital Solutions

Startups are often at the forefront of technological adoption, and their influence is pushing franchisors to embrace digital solutions. This includes the implementation of advanced point-of-sale systems, online ordering platforms and customer engagement tools. Franchises that integrate technology effectively can improve efficiency and enhance the customer experience, staying competitive in a rapidly evolving market.

5. Changing Franchisee Profiles

The profile of franchisees is also changing. With more entrepreneurs drawn to franchising, the demographic is becoming younger and more diverse. This shift brings fresh perspectives and a willingness to experiment with new strategies, which can benefit franchisors looking to innovate and stay relevant.

Keeping ahead of the competition

While the rise in startups presents many opportunities for franchising, it also poses challenges. Franchisors must navigate a landscape where competition is fierce, and consumer expectations are high. The influx of new businesses can lead to market saturation in certain sectors, making it essential for franchisors to conduct thorough market research and develop robust support systems for franchisees.

The record numbers of startups are reshaping the franchising landscape, introducing both opportunities and challenges. As the market evolves, franchisors must adapt to stay competitive, leveraging technology and innovation while responding to the shifting dynamics of consumer behaviour.

Now there’s a game-changing new strategic tool to help you to:

revitalise your Business Model
enhance your competitive edge
explore new opportunities in your markets
implement change in your franchise network

My new e-book will show you how. Download it for free.

ARRANGE YOUR

FREE

CONSULTATION

That’s me on the right. I worked with this client to reinvent their franchise and business models and today they’re the biggest home-grown brand in their industry. Could I do the same for you? Contact me to arrange a free confidential strategy consultation.

Famous Franchise Failures - and Those Which Came Back From the Brink

robin@noordinary.co.nz (Robin La Pere) — Mon, 23 Sep 2024 22:25:22 GMT

Understanding end-customers’ evolving needs and market trends is essential to keeping your Franchise Business Model relevant. Was part of the reason that these famous franchises failed because the franchisors failed to understand the end-customers as well as their franchisees did?

Franchises which failed due to their Business Models becoming obsolete

In 2000, Blockbuster had 9,000 stores and was valued at $5 billion. A decade later they filed for bankruptcy. Their biggest mistake? Failing to recognise the emerging streaming business model and turning down the opportunity to buy Netflix ten years earlier for a mere $50 million. Today Netflix is valued at $291 billion.

Once upon a time, every kid wanted to go to Toys R Us. Although most of their stores were company-owned, they did license 257 stores across 38 countries. But they failed to innovate their business model, incorporate technology or adapt to changing consumer behavior – and in 2017 they filed for bankruptcy.

The brand’s last two remaining US locations closed in 2021.

You may not have heard of Quiznos if you live in Australia or New Zealand. But in 2005, Quiznos was the second-largest submarine sandwich franchise in the world, second only to Subway.

Why did 95% of their 4000+ locations later close? Because most of their franchisees went broke or walked away.

Franchises which came back from the brink

With 20,000+ locations, Domino’s is the world leader in pizza – but it wasn’t always that way. Just a few years ago, their ‘cardboard pizzas’ were struggling to compete with Pizza Hut’s quality.

What changed? First, Domino’s franchise management listened to their end-customers. They admitted their faults. Then they made some bold changes which transformed their product, technology and marketing. Boom! They were back in business.

Franchise systems are different from corporates when it comes to turning them around – you need to bring your franchisees with you.

That’s exactly what Cheryl Bachelder did when she became the CEO of Popeyes Louisiana Kitchen in 2007. “My team and I decided to focus intently on the franchisees rather than other stakeholders,” she said. “We decided to measure our success by their success.”

You may not think of the Ford Motor Company as a franchise but its global dealership network is effectively one.

Ford engineered a remarkable turnaround in the late 2000s by recognising that their dealers were their primary link to their customers and involving them in the decision-making process.

What's the difference between the failures and the comebacks?

The franchises which managed to turn themselves around and become successful were the ones which listened to their customers, involved their franchisees in the strategy planning process and reinvented their business models accordingly.

Now there’s a game-changing new strategic tool to help you to:

revitalise your Business Model
enhance your competitive edge
explore new opportunities in your markets
implement change in your franchise network

My new e-book will show you how. Download it for free.

Beware of ‘Alternatives to Franchises’: They May Still Be Franchises Under the Law

robin@noordinary.co.nz (Robin La Pere) — Wed, 21 Aug 2024 23:44:11 GMT

An ad for an ‘alternative to franchising’ recently caught my attention. I specialise in all kinds of ways of scaling businesses, so I was interested in what the advertiser had to offer, and read on. This ad promised an alternative business model to franchising without the legal entanglements.

Uh-oh.

There are no laws specifically covering franchising in New Zealand, where I am based, but because I also work with franchisors in countries where franchising is regulated, I am fully aware of the dangers of misclassifying a business model as an ‘alternative to franchising’ when in fact it would be defined as a franchise under the law.

Franchise laws are designed to protect franchisees from unfair practices and ensure transparency. They typically require franchisors to provide a Franchise Disclosure Document (FDD), adhere to specific advertising rules and follow other regulatory guidelines. Business models that resemble franchising but are misclassified as something else leave ‘franchisees’ unprotected and unsuspecting or unscrupulous ‘franchisors’ vulnerable to severe legal consequences.

The Franchise Trap

Business owners are drawn to expansion models marketed as franchise alternatives, such as:

Licence agreements
Distribution agreements
Dealerships

While these models may seem distinct from franchising, the legal definition of a franchise is broader than many realise. In most jurisdictions, including Australia and the United States, a business relationship is considered a franchise if it meets three key criteria:

The right to use the franchisor's trademark
Significant operational control or assistance from the franchisor
Payment of a fee to the franchisor

If your business model meets these criteria, it may be classified as a franchise regardless of what you call it.

Consequences of Misclassification

Failing to comply with franchise laws can result in severe penalties, including:

Fines and monetary damages
Cancellation of agreements
Criminal charges in some cases

Protecting your business

To protect your business from the risks of franchise misclassification:

Consult with me or a franchise lawyer before implementing any expansion model
Carefully review your business structure against franchise laws in your jurisdiction
If your model meets the definition of a franchise, embrace it and comply with all relevant regulations

Remember, attempting to circumvent franchise laws rarely ends well. It's far better to structure your business properly from the start than to face costly legal battles down the road. By understanding and respecting franchise laws, you can build a strong, compliant expansion model that sets your business up for long-term success.

The Chinese are Coming: Massive Competition and a Slowing Economy Spur International Franchise Expansion

robin@noordinary.co.nz (Robin La Pere) — Wed, 21 Aug 2024 20:46:53 GMT

I expected more from one of the world’s fastest trains as it sped me from the airport into the heart of Shanghai, one of the world’s largest cities. But although the Maglev is capable of speeds of up to 500 km/h, it has disappointingly been limited to only 301km/h since 2019.

It was a fitting metaphor for a country whose economic growth has slowed from historic highs to a slightly more sedate pace.

My meeting with a client in Shanghai and research on the boom in franchising in China revealed a shifting landscape that’s pushing many domestic franchises to look beyond their borders for growth.

The Challenges Facing Franchising in China

As is traditional, the meeting with my client began with a tea ceremony. As my client poured the tea into tiny cups, he shared with me the challenges of doing business in China’s fiercely competitive franchise market.

Galvanised by an influx of international franchises and chains (China is Starbucks’ second largest market), domestic franchising took off in China from the early 2000s, he explained. There are now 6,000 active franchise systems and well over 400,000 franchised outlets, making China one of the largest franchise markets in the world.

The International Opportunity

However, this rapid growth has led to intense competition and market saturation in many sectors, especially F&B. At the same time, China's economic growth is slowing. China's GDP growth for the first half of 2024 was around 5%, down from the double-digit growth rates of previous decades. This economic deceleration is putting pressure on domestic consumption, further intensifying competition among franchises.

These factors are driving Chinese franchisors to look overseas for expansion opportunities.

Already, popular hot pot chain Haidilao has established itself in South East Asia, North America and Australia, and announced this year it’s opening franchising to “further ramp up the pace of expansion of the restaurant network.” Similarly, bubble tea giant Heytea launched its global ambitions with company-owned stores but has now ventured into franchising to scale its overseas presence beyond Singapore, where it has opened six stores since 2018.

Obstacles to Chinese Global Expansion

However, international expansion isn’t without its challenges. Cultural differences, regulatory hurdles and adapting to local tastes are just a few of the obstacles Chinese franchises face.

My client is tackling these challenges head-on. They’re conducting extensive market research, partnering with local experts (like yours truly) and planning to adapt their product offerings and store designs to suit Western tastes while maintaining their core Chinese identity.

Why Australia and New Zealand are ideal launchpads for Chinese franchise expansion

For Chinese franchises considering global expansion, my client believes that Australia and New Zealand offer an attractive and strategic stepping stone into larger North American and European markets. The reasons behind this are deeply rooted in cultural, economic and logistical advantages that make these two countries a perfect testing ground for Chinese businesses eager to make their mark on the world stage.

Cultural and Taste Parallels: A Bridge to Western Markets

One of the key advantages of expanding into Australia and New Zealand is the cultural and taste parallels these markets share with North America and Europe. Both Australia and New Zealand have consumer bases that are largely influenced by Western culture, particularly in terms of lifestyle, entertainment and food preferences. This offers Chinese franchises a unique opportunity to adapt and fine-tune their offerings in markets that closely mirror the demands and expectations of Western consumers – and to do it at less cost and with less risk.

Consumer Affinity and Demand: A Welcoming Market for Chinese Brands

Both Australia and New Zealand are home to diverse, multicultural societies with a strong appetite for international brands. Chinese products and brands have already made significant inroads into these markets, with consumers showing a growing preference for Asian goods and cuisines.

A Shared Cultural Heritage: The Chinese Diaspora in Australasia

Australia and New Zealand have long-standing Chinese communities, which have fostered a cultural familiarity that new Chinese franchises can tap into. With a significant portion of the population in both countries identifying as of Chinese descent, there is a ready-made market that understands and appreciates Chinese culture, cuisine and products.

Economic Stability and Business-Friendliness

Australia and New Zealand have stable economies and transparent and business-friendly regulatory environments. For Chinese franchises, this economic stability is a major attraction, offering a lower risk of market volatility compared to other regions. The close economic ties between China and these countries, underscored by free trade agreements and ongoing trade partnerships, also facilitate smoother market entry for Chinese franchises.

Less Competition from other Chinese franchises

Chinese franchises looking to go global have tended to focus on geographically-close markets such as other Asian countries or larger markets such as North America – and run into fierce competition from locally-developed and other expanding Asian franchises. This has left a gap for Chinese franchises which are well branded and funded to take a dominant share in these markets.

Here comes the future

My visit to Shanghai has made it clear that, as China's domestic market becomes increasingly competitive and its economy moderates, we can expect to see more Chinese franchises looking to expand internationally. This trend presents both opportunities and challenges for the global franchise industry.

For franchisors in countries like New Zealand and Australia, it means increased competition but also potential partnership opportunities. For consumers, it promises a more diverse array of products and services.

One thing is clear: the Chinese franchising dragon is stirring, and its gaze is turning outward. The global franchise landscape is set for some interesting changes in the coming years.

How the Latest Training Techniques Can Boost Your Franchisees’ Performance

robin@noordinary.co.nz (Robin La Pere) — Wed, 19 Jun 2024 02:23:28 GMT

You can’t be successful unless your franchisees are.

It’s a cliché but for most franchises, higher franchisee sales mean greater percentage royalties for the franchisors. So you would think franchisors would have a vested interest in helping their franchisees to perform at a high level.

But in my experience as a franchise consultant, that’s not always the case. Too many franchisors are still relying on a day or two of initial training and handing their franchisees a weighty printed manual to read in their own time.

Smart (and successful) franchisors recognise the importance of training, onboarding and support to success and have adopted the latest training techniques to make the process far more effective.

This isn’t the latest training technique but it may be the greatest

It’s called Blended Learning

Gone are the days of one-size-fits-all training methods. Modern franchisees have diverse learning styles and preferences, requiring a blended learning approach that combines various delivery methods. This technique integrates traditional classroom-style training with online modules, video tutorials, interactive simulations and hands-on practical sessions.

By catering to different learning styles, franchisors can ensure that franchisees effectively absorb and retain the knowledge and skills imparted during training.

The key is to understand your franchisees’ needs

Understanding those needs actually starts before your franchisees even come on board with you. Because not all franchisees will fully match up to your franchisee selection criteria, an effective Franchisee Selection Process will assess and match your prospective franchisees’ strengths and weaknesses against your criteria, instantly identifying the successful candidates’ training needs.

Franchisee Selection: How to Select Franchisees with the Right Stuff

Attracting and selecting the ‘right’ franchisees is almost always cited as the biggest challenge that franchisors face, according to surveys. So how do you attract and select franchisees with the ‘right stuff’? This article shares some important and useful tips .

The next step is to customise your training

Imagine you’re a personal trainer. You wouldn’t expect every one of your clients to lift weights like these if they had never worked out before. You’d first assess them and tailor their training to progressively build their strength.

Then why do franchisors use one-size-fits-all training programmes? By tailoring your training programme to accommodate individual franchisee’s differences, your franchisees can develop a deeper sense of ownership and relevance, leading to increased engagement and better performance.

Put it all together on your very own intranet

For franchisors looking to drive greater franchisee performance and profitability across their system, implementing a franchise intranet can be a game-changer.

While printed franchise operations manuals have been the traditional method for documenting processes, sharing information and training, an intranet offers significant advantages that can supercharge franchisee success. Read more here .

Need help to improve your franchisee training and manual?

Developing an effective franchise intranet and training programmes takes more than digitising your existing manual and uploading it online. As a teaching, marketing and franchise professional, I have the expertise you need to take your intranet and training to the next level.

Subscribe to my email newsletter or follow me on Linkedin, Facebook or X to ensure you don't miss my upcoming article on how to develop your intranet and training more cost effectively than you may have thought.

Amazing Things You Can Do With Your Franchise Intranet

robin@noordinary.co.nz (Robin La Pere) — Wed, 19 Jun 2024 02:08:53 GMT

As a franchisor, having an effective intranet for your franchise system can be a game-changer.

An intranet is a private network accessible only by your franchisees, employees, suppliers, service providers and any other users you approve. It serves as a centralised hub for communication, collaboration, and knowledge sharing within your franchise organisation.

But that’s just the beginning…

A virtual meeting place for your entire franchise network

Some of the most important communication, knowledge sharing and problem solving in most organisations takes place at the water cooler, coffee machine or other informal meeting place.

The issue that franchises have is geographical distance between franchisees. But an intranet solves that by acting as a virtual meeting place for your entire franchise network. Use it to share important announcements, updates, and best practices with all your franchisees simultaneously. Encourage franchisees to collaborate and exchange ideas through discussion forums, message boards or chat rooms.

Example of an intranet for employees. Source: Axero Solutions

Meeting the varied needs of everybody in your organisation

Developing an effective franchise intranet takes more than digitising your existing manual and uploading it online.

Yes, your intranet can serve as a centralised repository for all your franchise’s operational documents, policies and procedures. Two of the key advantages over a printed franchise manual are that you and your network can access the repository from anywhere on any digital device and it's a simple matter to keep it up to date. This ensures that franchisees have access to the latest versions and can easily stay compliant with your brand standards and legal requirements.

Example of professional skills training using gamification. Source: EI Powered by MPS

Comprehensive training and support resources

Leverage your intranet to host a vast library of training materials, including videos, manuals and interactive modules. This ensures consistent and up-to-date training for new franchisees and their and your employees. You can also offer online support through FAQs, troubleshooting guides and a dedicated support section.

As a teacher, mentor and conference and workshops organisor, I have always been interested in better ways of training and coaching, and I keep up with the latest innovations in the field. One of these is gamification. Gamification involves turning the learning process into a game by applying game principles such as challenges, point scoring, etc. Because training games are interactive, they motivate and engage your franchisees and have proven to be one of the most effective and exciting new training tools available.

Training the trainers

In my 25+ years in franchising, one of the biggest gaps I have found in the franchising model is that franchisees are so often expected to train and support their employees themselves, but aren’t given the training and tools they need to do this.

Another of the advantages of an intranet is that it can be used as a training resource, knowledge base and communications hub for both franchisees and their employees. And you can provide access to only relevant sections of the intranet, meaning that franchisee employees will only be able to access the content, resources and training materials that apply to them. Should an employee move on, their access will be immediately cut off, ensuring the confidentiality of the franchisor's and franchisee's intellectual property.

Reporting and performance tracking

You can’t manage what you can’t measure, and reporting, performance tracking and even benchmarking have become an essential part of franchise management. Because an intranet can provide instant access to all your franchise’s software and systems, it is the ideal way to implement a secure online reporting system, allowing franchisees to submit sales figures, inventory levels and other performance metrics. This streamlines data collection and enables you to track the performance of individual franchises and your overall franchise system more effectively.

How the Latest Training Techniques Can Boost Your Franchisees’ Performance

You can’t be successful unless your franchisees are.

It’s a cliché but for most franchises, higher franchisee sales mean greater percentage royalties for the franchisor. So you would think franchisors would have a vested interest in helping their franchisees to perform at a high level.

Read about the innovative training and support techniques that smart (and successful) franchisors have adopted to make the process far more effective.

Need help to improve your franchisee training and manual?

How Your Industry Is Being Disrupted Right Now

robin@noordinary.co.nz (Robin La Pere) — Tue, 11 Jun 2024 22:51:16 GMT

The success of your business depends on solving your customers’ problems. Need a clean home or office? There’s a cleaning company or franchise for that. Need to put your tax return in? There’s an accountancy or tax professional for that. And so on it goes.

But what if there is a business that does what you do, only better?

And what if it’s coming for you, right now?

I’ve got news for you — it is. I’m not trying to scare you, just make you aware if you’re not already. In this fast-changing world, my job as a strategy and innovation consultant is to keep business people like you up to date with the threats and opportunities facing your business every day.

And then to turn the threats into opportunities and the opportunities into greater revenue and higher profits.

You may be thinking “My business has been ticking along quite nicely for 30 years. What could possibly disrupt it now? Why would I need to change anything?”

I hate to say it but that kind of thinking makes you an easy target.

Stale ‘she’ll be right’ business models are ripe for disruption*.

Your current business model is already the product of disruption.

Would your business have looked exactly the same 30, 50 or 70 years ago? Of course not.

Here are some of the industries that are being shaken up by business disruption right now. And this is just the tip of the iceberg.

Retail

E-commerce platforms like Amazon have disrupted traditional brick-and-mortar retail by offering convenience, wide product selection, and competitive pricing.
Mobile commerce and apps have enabled seamless online shopping experiences.
Subscription-based business models like Dollar Shave Club have disrupted consumer product industries.

Transportation

Ride-sharing services like Uber and Lyft have disrupted the taxi industry by leveraging technology and gig economy workers.
Electric vehicles from companies like Tesla and BYD are disrupting the automotive industry with sustainable transportation solutions.
Autonomous driving technology has the potential to disrupt traditional vehicle ownership and transportation models.

Hospitality

Online travel agencies and home-sharing platforms like Airbnb have disrupted the hotel industry by offering alternative accommodation options.
Virtual and augmented reality technologies are enhancing the travel planning and booking experiences.

Financial Services

Fintech companies are disrupting traditional banking with mobile payment apps, peer-to-peer lending, and cryptocurrency.
Blockchain technology is disrupting financial services by enabling secure, decentralized transactions.

Healthcare

Telemedicine platforms are disrupting traditional healthcare delivery by providing remote consultations and monitoring.
Wearable devices and mobile apps are enabling personalized health tracking and management.
Artificial intelligence and machine learning are being applied to drug discovery, diagnosis, and treatment.

Education and Tuition

Online learning platforms like Coursera and edX are disrupting traditional education models by offering accessible and affordable courses.
Virtual and augmented reality technologies are enhancing immersive learning experiences.
Adaptive learning technologies are personalizing education based on individual student needs.

Food and Beverage

F&B businesses are using AI to help them manage their supply and labour needs in the face of shartages and increasing costs
Fast food chains and franchises such as McDonald's are reducing their store footprints as more customers choose drive-through or delivery services rather than sit-down options
Changing consumer preferences towards sustainability, health, and ethical sourcing are driving product innovation

These are just a few examples of the disruptive innovations transforming various business categories.

As technology continues to evolve, we can expect more disruptions that challenge traditional business models and create new opportunities for innovation and growth.

* ‘She’ll be right’ is an expression in Australian and New Zealand culture that, according to Wikipedia, ‘expresses the belief that “whatever is wrong will right itself with time”, which is considered to be either an optimistic or apathetic outlook’. I am based in Auckland, New Zealand, but I work with clients all around the world.

Want to learn more about how business disruption is changing your industry — and more particularly, what to do about it in your business?

This is one of a series of articles I've written to help you. Follow me on Facebook, Linkedin or X or subscribe to my email newsletter to make sure you don’t miss out.

I don’t try to predict the future. I help you create it.

I have been at the forefront of innovation and change in disrupted industries such as retail, advertising, financial services, education and building.

Today, I share my experience and expertise with businesses like yours to help you remain competitive and relevant in a fast-changing and increasingly disruptive business world.

Contact me to arrange a Free Initial Consultation by Zoom or phone to get the ball rolling for a better future for you and your business or franchise

Uh-oh, Could You Be Legally Liable For Your Franchisees’ Actions?

robin@noordinary.co.nz (Robin La Pere) — Thu, 06 Jun 2024 01:11:14 GMT

As a franchisor, one of the most critical aspects of your business model is the ability to maintain control over your brand, products, and services while simultaneously granting franchisees the autonomy to operate their individual units.

However, this delicate balance can sometimes be disrupted by the actions of franchisees, potentially exposing you to legal liabilities. In this blog post, we’ll explore the circumstances under which a franchisor could be held responsible for the actions of their franchisees.

“In the ever-expanding universe of matters that may keep franchisors up at night, concerns about their potential vicarious liability for the actions of franchisees or their employees likely tops the list.”

Franchisors and Vicarious Liability for Actions of Franchisees or Their Employees

Kilpatrick Townsend & Stockton LLP

Here are some relevant cases and considerations regarding franchisor liability for franchisee actions in New Zealand, Australia, the United Kingdom, and the United States:

In the US, there have been numerous cases where franchisors were held vicariously liable or as joint employers due to the level of control exerted over franchisees, such as the McDonald’s hot coffee case (Liebeck v McDonald’s Restaurants) and the Holiday Inns security case. And of course, McDonald’s Corp was brought to the table by the National Labor Relations Board and was only absolved of any joint liability for labor law violations committed by its franchisees after a settlement was reached.

While New Zealand does not have franchise-specific legislation, the general principles of agency law, negligence and breach of duty could expose franchisors to liability for franchisee actions. Factors like operational control, training requirements and marketing practices influence the risk. Franchisors have had to fight for the rights of their franchisees under changes to employment law which appeared to discriminate against franchises. The collaborative activity exemption in New Zealand’s amended Commerce Act may provide some protection for franchisor-franchisee territorial allocations and restraints.

Australia’s Franchising Code of Conduct explicitly requires franchisors and franchisees to act in good faith, potentially increasing franchisor liability. While not a very recent case, WorkCover Authority of New South Wales v McDonald’s Australia in respect of the death of a franchisee employee electrocuted on McDonald’s premises highlights the increased risk of liability when franchisors lease to or supply their franchisees.

While legal principles and theories do exist under which a franchisor in the United Kingdom could potentially be face liability claims for franchisee actions, it is evident that such claims against franchisors face significant hurdles under UK law - as they do under New Zealand and Australian law - compared to the United States legal system.

But while you may not be losing sleep now, it would certainly pay to minimise the risk of “the ever-expanding universe of matters that may keep franchisors up at night” by taking these measures:

minimise the actual control exercised by a franchisor over a franchisee and its employees
carefully draft the franchise agreement to retain control over only those matters that are necessary for the successful operation of the business
provide ample discretion to the franchisee over employee and other local operational matters
publicly acknowledge that franchisees operate independent businesses and encourage franchisees to make that clear to the public
consider insurance coverage for such liability and mandating franchisees maintain such coverage for the benefit of the franchisor

Please note that I am a franchise consultant, not a lawyer, and none of the text above is intended or should be construed as legal advice. However, I do work with some excellent specialist franchise lawyers and recommend that you consult with them on franchising legal matters rather than a non-specialist.

I am able to offer you my expertise in all other aspects of franchising and business scaling, including business model innovation, systems development, coaching and mentoring, speaking and franchisee recruitment.

Every week, I produce an email newsletter containing news, insights and information of value to franchisors, licensors and those considering or involved in scaling their businesses. Subscribe here or follow me on Linkedin, X or Facebook so you don't miss anything important!

If you are considering franchising your business or developing your existing franchise or licence system, I invite you to contact me to arrange a Free 30-Minute Initial Consultation .

Franchisee Selection: How to Select Franchisees with the Right Stuff

robin@noordinary.co.nz (Robin La Pere) — Thu, 06 Jun 2024 01:06:56 GMT

Attracting and selecting the ‘right’ franchisees is almost always cited as the biggest challenge that franchisors face, according to surveys.

Choose wisely, and your franchise won't just grow – it will thrive. But get it wrong and it could cost you your reputation and credibility. So how do you attract and select franchisees with the ‘right stuff’?

1. Generate Sufficient Leads

The first challenge is generating enough leads to have a range of prospects or candidates to choose from. This ensures that you can be selective and choose only the best candidates. Without a steady flow of qualified leads, your options become limited, and you may compromise on your ideal franchisee profile.

The foundation of any successful franchisee selection process is having a robust pool of candidates to choose from. Without this, you're essentially picking from a limited basket, which may force you to lower your standards.

So, how do you ensure a steady stream of quality leads?

Is your marketing working as well as it could? Could you be getting more qualified leads?

Over many years in marketing and franchising, I have sold many franchises and developed a keen understanding of best practices in franchisee recruitment marketing.

Click here for an Instant Download of this Free eBook

with 15 of my best tips

2. Define the ‘Ideal Franchisee’

Now that you have a steady flow of leads, how do you identify the cream of the crop?

By having a clear picture of your ideal franchisee. This isn’t about finding a mythical perfect candidate, but rather about understanding the key attributes that will lead to success in your specific franchise model.

But what does the ideal franchisee look like?

Of course, this will differ depending on your industry and franchise model. The qualities required to be a successful lawnmowing or cleaning franchisee will probably be quite different from the qualities required to be a successful retail or food services franchisee. And the attributes of a successful master franchisee or multi-unit franchisee will of course differ from those of someone purchasing a single franchise unit.

Probably the most important factor in determining the ideal franchisee is understanding the difference between the innate and the teachable. Innate qualities are the qualities that the prospective franchisee brings to the table, the qualities that inform their character such as integrity, conscientiousness, extroversion, openness to learning, stress tolerance, and drive.

These will form the basis of your Franchisee Selection Criteria.

Tip #1: How to identify what innate qualities prospects must already possess

Of course, nothing else matters if the prospect doesn’t have the necessary capital and access to funding to invest in your franchise. But that’s easy to find out.

Qualities such as those listed above are harder to assess. There are a number of personality profiling and franchisee recruitment software tools available that go some way to helping you with this. (I will be reviewing some of these in a future blog post.) However, there is no substitute for the traditional methods of interviewing, reference checking, trialling with existing franchisees, etc.

I will be detailing more of these in a future blog post – follow me on Facebook, Linkedin or X or subscribe to my email newsletter to make sure you don’t miss out.

Tip #2: How to identify what skills prospects must acquire in order to be successful

In addition to my experience as a former franchise manager and franchisor, and over more recent years as a franchise consultant, I have learned a great deal about best practice in franchisee recruitment from academic studies and other professionals in the field.

One of the Franchisee Selection Criteria I have read a lot about is ‘Business Experience’. My question is “Is it necessary for prospective franchisees to have had prior business experience or is that something that can be taught?” Many franchises claim that their ‘ideal franchisees’ don’t need business experience because the franchisor provides all the systems, training and support required by the franchisee. All the franchisee has to do is be open to training and guidance and to follow the franchise systems. In fact, many franchisors prefer prospects not to have had any business experience because as franchisees, they are more likely to fall into any bad habits they may have had rather than complying with the franchise’s way.

Even if a prospect may look less than ideal against your Franchisee Selection Criteria, in many cases it is more important to consider the prospect’s potential for growth and their willingness to learn and be coached. Franchisees who are coachable and eager to develop can often overcome initial shortcomings and become valuable assets to your franchise system.

Free Report Offer:

Expert Evaluation of Your Current

Franchisee Recruitment Marketing Process

Is your marketing working as well as it could? Could you be getting more qualified leads?

Over many years in marketing and franchising, I have sold many franchises and developed a keen understanding of best practices in franchisee recruitment marketing and selection.

I would welcome the opportunity to share that understanding with you with a Free Evaluation of your current Franchisee Recruitment Marketing Processes . Simply send me a few details about your franchise and I'll review your current franchisee recruitment marketing from a prospective franchisee's perspective and send you a Free Report within 2 - 3 days.

3 Ways That the Fastest Growing Franchises are Gaining New Franchisees

robin@noordinary.co.nz (Robin La Pere) — Wed, 29 May 2024 02:35:02 GMT

As competition grows to sell franchises, many franchise brands are turning to innovative ways to attract new franchisees to their systems.

From leveraging social media to offering unique incentives, the fastest-growing franchises are employing a variety of strategies to expand their reach and appeal to potential investors.

In this blog post, I explore three effective methods that these franchises are using to gain new franchisees.

“The No. 1 Franchise Recruitment Tool”

With over 5,400 Franchisees in four countries, and growing at the rate of around 200 per year, Jim’s Group is the largest franchise group in the southern hemisphere.

“This is the number 1 franchise recruitment tool,” says Jim’s Chief Marketing Officer, Joel Kleber, in this video. “I explain why it is and if you're not using it, why you should.”

Social Media

I can’t recall the exact figures, but at a recent Franchise Association of New Zealand (FANZ) meeting which I attended, a representative from the Caci Clinic Franchise said that their network throughout New Zealand had grown from around 50 to more than 80 franchises in a few short years.

That’s staggering growth considering New Zealand is a small country and Caci’s skincare, laser and injectables clinics aren’t cheap to set up.

One of the secrets to Caci’s success, she said, is their use of social media to reach their target markets.

Make It Uniquely Easy to Buy a Franchise

Lowering barriers to entry and reversing risk have always been part of franchising’s recruitment marketing strategies but it’s astounding how many franchisors expect prospective franchisees to come up with all the funding for their franchise themselves.

Nearly all franchises charge an initial or upfront fee, a one-off payment made by a new franchisee to the franchisor upon joining the franchise. Plus there’s the cost of any necessary plant and equipment, stock or materials, premises leasing and of course you need working capital to pay operating expenses until your sales cover your costs.

Smart franchisors make the buying decision simpler in the same way that retailers have for decades. They lower entry barriers by reducing the upfront cost to the franchisee, making the franchise purchase more affordable.

A classic example is fried chicken franchise Chick-fil-A which charges an upfront franchise fee of just US$10,000. No wonder they have literally thousands of people lined up to buy a franchise, but the quid pro quo is that as a franchisee, you have to share a large proportion of your profits with Chick-fil-A.

Caci Clinic, which I mentioned before, assists franchisees to obtain the expensive equipment needed to operate their clinic by leasing the equipment to them rather than requiring them to purchase it.

Even though the upfront fees and capital costs of most Jim’s Group franchises are relatively low, Jim’s understands that most of their franchisees have come from the regular income of paid employment and assists them in making the transition to self-employment by offering a minimum income guarantee for the first few months.

Need more ideas for supercharging your franchise growth?

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What’s the biggest issue for franchisors the world over?

Yep, it’s getting franchisees on board. But how is it that some franchises just keep powering forward, year after year, while others just tread water?

My free ebook 15 Innovative Franchise Marketing Tactics You’re Probably Not Using Yet (But Should Be) looks at how some of the world’s leading franchises have grown their networks – and how you can supercharge your growth in 2024 and beyond!

Free Report Offer:

Expert Evaluation of Your Current

Franchisee Recruitment Marketing Process

Is your marketing working as well as it could? Could you be getting more qualified leads?

Over many years in marketing and franchising, I have sold many franchises and developed a keen understanding of best practices in franchisee recruitment marketing and selection.

Would Starbucks and Sweetgreen have been better off by franchising?

robin@noordinary.co.nz (Robin La Pere) — Mon, 20 May 2024 05:24:20 GMT

The ideal way for businesses such as Starbucks or Sweetgreen – or yours – to scale depends on a whole range of factors.

These include strategic goals, market demand, financial considerations and the ability to maintain brand integrity and quality control while expanding.

Neither Starbucks or Sweetgreen has chosen franchising as their expansion model, preferring to own their own outlets. My question is: Why?

Source: New York Times

You will of course know Starbucks with its 38,000 stores worldwide but if you live outside the United States you may not have heard of Sweetgreen. Sweetgreen was founded in 2007 by three college graduates who were disappointed with campus food options. Their first 560-square-foot (50m2) location offered ‘fresh, plant-forward, earth friendly food’.

Source: Sweetgreen website

Their vision was to ‘be as ubiquitous as traditional fast-food, but far more transparent and honest’.

But how can you become ubiquitous when you currently have a mere 225 restaurants in 18 states and you’ve told your investors your plan is to open only 23 – 27 new restaurants in 2024?

To those outside the United States and Asia, that may seem like pretty fast growth, but when you compare it to the rate of the fastest growing F&B franchises, it seems a bit sluggish. For example, Jersey Mike’s Subs opened 309 new franchise locations in 2023. Popeyes Louisana Chicken opened 118.

Sweetgreen has had to raise more than half a billion dollars in investor’s funding to get this far.

And after 15 years, they are yet to make a profit.

This man camped overnight to be the first in New Zealand to try Popeyes

To be fair, the fast-growing franchises mentioned before are well-established brands in the United States. And Sweetgreen’s founders are all too aware of the dangers of expanding too rapidly.

Said co-founder and Chief Brand Officer Nathaniel Ru: “There are all of these cautionary tales about startups or restaurants that grew massively, transforming into slow-moving corporate entities where quality takes a nosedive, products become more bland, customers are no longer at the centre, and employees feel less involved and inspired. We’ve been determined to avoid that.”

Sweetgreen co-founder and Chief Brand Officer Nathaniel Ru

Sweetgreen’s founders talk a lot about the concept of ‘intimacy at scale’.

“For us, intimacy at scale is about proving that that we can serve healthy, real food at scale, while still making it feel like your Sweetgreen and not just a Sweetgreen,” Nathaniel Ru told First Round.

Part of achieving intimacy of scale relies on ‘becoming a student of the community’. To do this, Sweetgreen carefully researches each community they are considering entering and ‘partners’ with local suppliers and service providers to better understand the market before going ahead.

Sweetgreen spent a year studying the Houston market before setting up there, for example. They built relationships with local farmers. “The original thesis was really, ‘How do we make it ingredient driven and not recipe driven?’,” said Ru.

But wait, how can you fully ‘get’ every local market when you’re opening so many restaurants in so many communities every year? Wouldn’t it be smarter – and less costly and time-consuming – to partner with local business owners who already know and are involved in these communities? Franchising can accelerate growth, especially in new markets where local knowledge and expertise are crucial. It also allows for quicker expansion without the need for significant capital investment from the parent company.

Of course Sweetgreen has buckets of cash. In 2009, just two years after startup, they raised US$835,000 in seed funding. Their IPO in 2021 raised a staggering US$364 million.

But will this be enough to achieve the founders’ dream of ‘building the McDonald’s of our generation’?

Source: Squawkbox

Much of the mountain of cash has already been spent on preparing for Sweetgreen’s future growth with acquisitions, innovations, design, marketing and technology that lead the fast casual restaurant industry in the United States. (More about this in my next article ‘What the Restaurant and Franchise Industry Can Learn From Sweetgreen’ .)

Thanks to premium pricing, strong supply chains and sophisticated operational systems Sweetgreen restaurants’ net profit per unit is said to be as high as 18%, far greater than the fast casual industry average. But that hasn’t been enough to pay the returns that Sweetgreen’s investors must be holding out for.

“We can’t stop now, because this doesn’t work at 100 restaurants,” CEO Jonathan Neman said in 2019. “The next stop is 1,000.”

Plenty of businesses have started scaling with company-owned locations and then, once the business model has been fine-tuned, turned to franchising to accelerate their expansion. Should Sweetgreen?

Don’t miss the next in this series of articles ‘What the Restaurant and Franchise Industry Can Learn from Sweetgreen’. Subscribe to my email newsletter or follow me on Linkedin, X or Facebook.

And if you’re ready to start scaling your business, contact me to arrange a Free Initial Consultation .

Why is the world’s weirdest brand name worth $1.4 billion?

robin@noordinary.co.nz (Robin La Pere) — Thu, 16 May 2024 01:59:32 GMT

Don’t be scared. It’s just water.

That’s the catchcry of what is currently one of the world’s coolest brands, Liquid Death.

But it is just water. And water is boring. Or it was until now.

In this video of the introduction to his interview with Liquid Death CEO and founder Mike Cessario, Jon Evans of Uncensored CMO says that Liquid Death took the “very boring, very commoditised water market – and completely turned it on its head.”

How do you do that when the Liquid Death brand is, as Evans points out, “the antithesis of obviously what water is”?

In this video, Mike Cessario explains how Richard Branson and his Virgin brand inspired his own brand marketing strategy, first with brandy (which didn’t work out for him) and then with water.

“The biggest risk you can make as a brand is to blend in,” says Cessario. But giving your product or business an ‘out there’ brand name can have its risks, too. Here’s a Tiktok video of a mother who felt buying a can of Liquid Death “just wasn’t right”.

In spite of this kind of reaction from those not in its target market, Liquid Death has found a huge fan base among young people who love the brand’s ‘cool’ name and design as well as mothers who want their kids to drink something healthy, according to Mike Cessario.

As you can see from this graph from data storytelling firm Chartr, Liquid Death has built a social brand that has more followers than all other water brands combined, including long-established brands such as Evian and Perrier.

This following and valuation underscore the importance of brand and its impact on consumer behaviour. While the other water brands differentiate themselves on the purity, source and healthiness – once thought to be the only key selling propositions in the industry – Liquid Death has achieved massive success by going in the opposite direction, disrupting the whole bottled water category by positioning itself as punk, cool and funny.

Incorporating a brand’s world view, rather than just its features and benefits, has become increasingly important in branding, but it is still often overlooked by marketers.

That’s why I have put together a series of articles on ‘The New Branding’.

This is the first, so to make sure you don’t miss the rest in the series, subscribe to my email newsletter here , or follow me on Linkedin, X or Facebook. And feel free to contact me to arrange a free Initial Consultation to discuss your product, service or business branding needs .

Is this the best or worst advice on success ever?

robin@noordinary.co.nz (Robin La Pere) — Thu, 09 May 2024 00:51:53 GMT

A billionaire says that business success can only be achieved through having low expectations and experiencing pain and suffering.

Do you agree with him?

Like many Baby Boomers, I grew up following motivational gurus like Tony Robbins, Robert Kiyosaki, Brian Tracy, Susan Jeffers and Napoleon Hill. Pretty much all of these people encouraged us to have high expectations of ourselves.

But the CEO of a $2 trillion unicorn is now telling us that the secret to his business success has actually been the opposite — having low expectations.

“People with very high expectations have very low resilience—and unfortunately, resilience matters in success,” NVIDIA boss Jensen Huang told students at Stanford University. “One of my great advantages is that I have very low expectations.”

NVIDIA produces the graphics processing units (GPUs) that have driven advances in AI, gaming, creative design, autonomous vehicles, and robotics.

Huang then explained that success is earned through suffering and pain, which are prerequisites for developing character.

“Greatness comes from character," he said.

Take a look at this video of Huang's keynote speech and let me know your thoughts.

Amazing Ways That AI is Changing the Game for Businesses Like Yours

robin@noordinary.co.nz (Robin La Pere) — Wed, 08 May 2024 23:04:38 GMT

By now you probably know that AI is now being used by pretty much every industry – in fact, unless you’re a hermit living in a cave, it’s all around us every day.

Here are a few examples of new technology changing or in the process of changing our business models (including mine – more about this later).

Business Advice and Coaching

In my view, every small business should have a board of advisors. But can AI do this as well as people?

The jury is still out on that but there is no doubt that any human board of advisors could benefit from working with AI to enhance the range and quality of the advice and coaching they offer to business people and franchisors.

Interior Design, New Home Building and Construction

This video shows one of the ways AI is being utilised by interior designers, architects, new home builders and construction companies.

These professionals can use AI not only to help them design buildings, renovations and fitouts, but also to ‘experience’ the finished design in its built state — before construction even starts.

In addition, AI has been instrumental in automating and streamlining many other construction tasks, including quantity surveying, project management and supply chain management.

It is always much more difficult to sell the intangible than the tangible — and this is especially the case for new home designers and builders who must sell their design concepts before any building can begin. But the two images below show how my team was able to turn an architect's drawing into a realistic-looking image of how the new home may look when completed, complete with landscaping and a beautiful blue sky. Best of all, AI enabled them to produce the rendered image in just a few minutes and at a fraction of the cost of an human illustrator.

From this...

to this...

Education and Coaching

AI can bring learning to life with tools such as 3D modelling, video, virtual reality and interactive problem solving.

Other uses for AI in education, tutoring and coaching include curriculum development, lesson planning, educational content creation, personalised education and training, and instant feedback and assessment.

Property Maintenance

You may have already seen one of the uses of AI and robotics in commercial cleaning but the potential for the uses of AI in the property management and cleaning industry is virtually limitless, as you can see here with AI in conjunction with drone technology to perform the difficult and dangerous task of cleaning high-rise building windows.

What makes AI different from anything that has gone before

We have long imagined technology that can think for itself, but until quite recently, computers and robots lacked the capacity for human-like reasoning, learning or understanding. Artificial intelligence is changing all that.

That’s scary as well as promising, but the fact that companies such as Meta, Alphabet and Microsoft are spending billions on developing AI, and many government departments and corporations are already using it, means it cannot be ignored.

* Some of the images in this blog were created using AI, either through text-to-image or by modifying existing photographs. Can you guess which ones?

Is AI a threat to the franchise industry?

robin@noordinary.co.nz (Robin La Pere) — Thu, 02 May 2024 00:46:57 GMT

One of the advantages of franchising is that it enables businesses to scale quickly.

The internet has already posed a threat to the bricks-and-mortar retail because e-commerce has enabled retailers to sell anything to anyone online, thereby scaling instantly. The fact that bricks-and-mortar retailers still exist is partly because they scrambled to adapt their business model to include e-commerce and partly because people still like to physically see and touch what they’re buying and to interact with real people while they’re doing it.

Artificial intelligence has the potential to enable businesses to scale in different ways

One of the barriers to scaling is the shortage and high cost of labour, but AI will help to solve this by streamlining human workloads, reducing the need for large workforces.

There is, of course, widespread concern that this will lead to greater unemployment, but pundits are of the view that AI will augment human abilities, changing the way we work and making us more productive.

To quote an IBM study: “AI won’t replace people, but people who use AI will replace people who don’t.”

The same adage may apply to businesses, including franchises, which don’t use AI.

To begin to understand how AI could be an opportunity for franchisors, rather than a threat, I am producing a series of articles on how AI is being used across a range of industries, and the potential for AI in franchising in the future. You can read the first article in the series How Businesses are Using AI to Gain a Competitive Advantage here .

Make sure you don’t miss the next articles in this not-to-be-missed series by subscribing to my newsletter or following No Ordinary Businesses and Franchises on Linkedin, X or Facebook.

How Businesses are Using AI to Gain a Competitive Advantage

robin@noordinary.co.nz (Robin La Pere) — Wed, 01 May 2024 23:34:12 GMT

Despite warnings about its risks, artificial intelligence has already become the Next Big Thing.

Whether we realise it or not, we’re already exposed to it in our daily lives. And there’s a pretty good chance that if you’re not already using it in your business, your competitors are.

With mixed results, I have to say. This video demonstrates the AI drive-thru technology now being used by fast food restaurants including Carl's Jr., Hardee's, Del Taco, and Checkers across the United States and by a growing number worldwide.

The AI system uses automatic speech recognition to convert orders to text, allowing the technology to understand and process human speech.

This also works with incoming sales enquiries. Can you tell if this caller is talking to a chatbot rather than a real human?

The unnatural pauses and speech patterns give it away. But the technology is getting better all the time.

Sales calls and fast-food orders aren’t the only business processes that AI is automating. Here are the main ways that companies in the United States are currently using AI.

How Business Owners Use Artificial Intelligence

Source: Forbes Advisor

But we have only just begun to tap the full potential of AI. The real value of AI is not in automating specific business processes but in integrating them to produce a seamless workflow across everything that your business does.

Automated and integrated workflows have the potential to give businesses in all industries an enormous competitive advantage. They will allow small companies to compete with much larger companies. And they will allow all companies, no matter what size, to scale much more easily than before.

Let me give you an example.

You may say: “I own a commercial cleaning company – you’ll never be able to automate the actual work of cleaning. You’ll always need people.”

That’s only partially true, as this video shows.

I’m yet to find an AI-powered robot that can dust and clean furniture as well as floors but of course, Dyson is already working on that.

My view is that AI will never completely replace humans but will support and assist us in our efforts. And as a result, many business models will need to adapt and change.

To illustrate how this may work, let’s stay with the commercial cleaning industry. When I was at school, I had a part-time cleaning job. It took me hours every week to mop and polish hard floors and vacuum carpets. A cleaner’s hourly wage is low, but if you added my pay up over a year, it must have come to a few thousand dollars. These days, you could use an AI-powered robot like the one in the video above to do the same job than I did – and I daresay it might well do a better job.

But, I hear you say, those robots cost tens of thousands of dollars.

Yes, but if you lease one, it could cost you less than the wages you would need to pay to a cleaner like me, and much less than using a commercial cleaning company.

See where I’m going with this? How will human cleaners and cleaning companies be able to compete with robots?

The answer lies in that old adage “If you can’t beat ’em, join ’em”. As I said above, robots can’t do everything that human cleaners do. At the time of writing this, you still need humans to clean things such as toilets, furniture and keyboards. But smart cleaning companies will become providers of robotic cleaning services as well as the more specialised services that only humans can currently provide. This will help to solve cleaning companies’ perennial problem – shortage of labour – and make them more competitive in the marketplace.

This article is the first of a series on how AI is likely to affect your industry and how you'll need to adapt your business model to remain relevant in a changing world.

* The image above shows how AI thinks I should look. What do you think?

How to Win Business Awards (and Why You Should Enter)

robin@noordinary.co.nz (Robin La Pere) — Wed, 24 Apr 2024 00:17:09 GMT

Winning business awards is about so much more than recognition and reputation. It’s about the journey of business improvement, excellence and growth—not only for your business, but for you and your team.

Studies bear this out. Three years after receiving an award, the sales of 120 award-winning companies outperformed comparison companies by an average of 17% according to a study by the British Quality Foundation and the European Foundation for Quality Management.

Other studies show that winning a business award can set you apart from competitors, boost your brand reputation, attract new customers and inspire your team.

But winning isn’t everything.

Thinking that their businesses aren’t good enough to win any awards is what stops many business people from entering. They have missed the whole point of entering awards. Few businesses win the first time they enter. But that’s not why they enter. If they’re smart, they’ll use their participation in the awards process to benchmark themselves against best practice companies and organisations, identify their own strengths and weaknesses, learn from the best and make the changes they need to improve and innovate.

Then they will have the real potential to win in the future - and to reap the rewards of winning.

In this article, I’ll share some tips to help you navigate the path to winning business awards.

1. Start small

Below is the criteria for the Baldrige Business Excellence Award. As you can see, this award covers every aspect of business performance, and many other business awards use the same or a similar framework. To win these awards, you must be able to demonstrate that your whole business performs in a cohesive and powerful way—and that you have the results to show for it.

Other award programmes showcase particular categories of organisational excellence such as leadership, innovation, health and safety, customer experience, social responsibility, productivity and sustainability. It pays to start your awards participation in a category where you, your team or your business have strengths or points of difference, and build from there.

For example, I prepared the entry for one of my clients to a Business Leadership Award, which he won. Some years later, I worked with the same client to win all three awards he and his team entered for (Field Manager of the Year, Franchisee of the Year and Franchise of the Year) and ultimately he and his team walked away from the awards ceremony with an extra award—Supreme Franchise of the Year.

2. Choose the right awards

Not all business awards are created equal. Select awards that align with your industry, business size, and achievements. Research various award programmes to find the ones that best suit your business profile and objectives. Consider factors such as judging criteria, reputation of the awarding body, past winners and likely media exposure to make an informed decision.

3. Understand the awards criteria

Every awards programme has different judging criteria but most are based on quality and excellence models such as the European Foundation for Quality Management (EFQM) Excellence Model and the Baldrige Excellence Framework. Understanding how these work and what the judges will be looking for is essential. It is worth attending any entry preparation workshops that the awards organisers. Better still, contract a professional with successful awards experience to help you.

For more details on awards criteria, see my article It's Business Awards Season! Are You Ready to Win?

4. Prepare a compelling award entry

The key is to stand out from the other entries and catch the judges' attention. This isn't as easy as it may sound because most award programmes have strict rules about how the entry must be set out, the number of words and/or pages, etc. Pay close attention to the entry criteria and use short sentences and bulletpoints that meet each requirement clearly and concisely. Break text up with subheadings, graphs, pull quotes and images. The Results section in the Baldridge model generally makes up 40% of your total score, so make sure you provide concrete examples, data-driven results, testimonials and references to substantiate your claims.

5. Leverage your team, customers, suppliers and partners

If you want to derive optimum benefit from entering a business award, it must be collective effort from everyone involved in or with your business. Encouraging your employees to share their insights and contributions helps to build engagement and satisfaction. Reaching out to satisfied customers for testimonials or endorsements can add credibility to your entry.

A final thought: Celebrate and share your achievements

As the points above illustrate, entering for a business award is an achievement in itself and has value that more than justifies the time and effort it takes to enter. And if you win an award or receive recognition as a finalist, it is worth making the most of the opportunity to celebrate your achievements and share the news with your stakeholders, customers and the media. Utilise social media, press releases and your website to announce the accolade and leverage it as part of your marketing.

Top 10 Ways to Improve Your Business Right Now

robin@noordinary.co.nz (Robin La Pere) — Tue, 23 Apr 2024 21:48:36 GMT

If you don’t think your business needs any form of improvement, you may as well shut it down right now.

The fact is, none of us is perfect — and no business is perfect. The most successful people in business recognise that. They are constantly striving for perfection, knowing they’ll never get there but also knowing that unless they try, they risk falling behind their competitors and losing everything.

The good news is that there are 10 improvements you can make right now.

These are not quick fixes, however. They are the beginnings of a journey of continuous improvement that every company must undertake if they are to continue to survive and thrive.

1. Identify your critical success factors

2. Keep score

You can only manage what you can measure, so it’s essential to track your business’s performance against your critical success factors. For this, you’ll need some kind of tracking system — there’s plenty of software that will do the trick — but the key is to measure consistently over time.

3. Learn from the best

4. Create the future

The first subheadline I used against this point was ‘Monitor trends’. No business operates in a vacuum. You need to be aware of the trends and changes that are impacting your industry as well as the wider business environment. But simply following trends is not enough. The best way to predict the future is to create it. Think about some of the ways you could possibly set the trends in your industry.

5. Involve your people

Believe it or not, you don’t have the monopoly on good ideas in your business. Your partner(s) and employees may well have suggestions for your improvement that will make a real difference. You'll gain access to a free thinktank, but unless you involve them in the process, you’re unlikely to obtain their buy-in to your improvement programme.

6. Set goals

Only when you know what your critical success factors are, where you stand in the industry and where you want to be in the future can you set goals for improvement. And, of course, these goals will need to be S.M.A.R.T. — specific, measurable, agreed upon, realistic and time-based. I’ve found the most effective goal-setting technique is to set your long-term objectives first — where you want to be in five years’ time, for example — and then work backwards to create the steps you’ll need to climb every week, month and year in order to reach your long-term targets.

7. Make a plan

You wouldn’t try to build a house without a plan, so why would you run a business without a plan? A house plan not only gives you an architect’s vision of what the completed building will look like, but also what’s required to build it and how it will be built. A business improvement plan is the same. It’s about the resources and systems you’ll need to build a better business.

8. Develop systems

I know I’ve already mentioned systems but they’re so important that I’m giving them their own section. Systems are ways of doing things that can be done the same way, every time, achieving the same predictable results as efficiently as possible. Examples include processes for selling your products, raising invoices, even answering the telephone. The quality management guru W. Edwards Deming once said, “If you can’t describe what you are doing as a system, you don’t know what you’re doing.”

9. ‘Sharpen the saw’

10. Know your limitations

One of the biggest mistakes that business owners make, in my experience, is thinking you can do it all. You can’t. None of us can. None of us is indispensable. Delegate. Don’t just involve your people in the planning process, involve them in making the plan happen. If you don’t have people in your business who can make decisions and take charge when necessary, don’t make excuses. Find them or coach your existing people. Sometimes the best way to improve your business and re-ignite your passion is to leave the day-to-day running to your people and focus on working on your business rather than in it.

Get help: It doesn’t have a number but it may be the most important improvement you can make

Forgive me if I’ve made any of the above sound as if it should be easy. It isn’t. That’s why most successful business people I know have mentors or coaches to help them with every step of the improvement process, including benchmarking, goal setting, planning, and facilitating their teams.

How Franchisee Selection Criteria Can Make or Break Your Franchise

robin@noordinary.co.nz (Robin La Pere) — Wed, 17 Apr 2024 23:15:28 GMT

Part 2 in our series on Franchisee Selection: Why It Is the Most Important Decision Franchisors Make

It doesn’t matter how good your systems, training and support are—if you don’t select the ‘right’ franchisees in the first place, none of it is going to produce a high performing franchise. Yet as a franchise consultant, I can't believe how many franchisors rely on gut feeling or, worse still, chance in the way they select franchisees.

But what do the 'right' franchisees look like?

As I mentioned in the first article in this series, that depends on the franchise business, according to Christiane Gaul of the University of Applied Sciences in Kufstein, Austria, in her study Partner Selection Process in Franchising . Of course, the kind of candidates a franchisor looks for will be different for a lawn-mowing franchise than a professional services franchise.

Let's look at who the 'right' people are for some well-established franchises...

The right people for Domino’s

Sometimes a franchise’s recruitment strategy can contain elements you’d expect in a start-up franchise as well as a mature one.

Domino’s may be one of the largest franchises in the world, but it got that way through an aggressive approach to both marketing and franchising. What essential ingredients does Domino’s look for in a franchisee? It's not just about having enough dough...

Entrepreneurial mentality
A passion, commitment and drive to success
Strong leadership skills
A real team player
Good administration skills
An ability to have fun and work in a young, energetic and vibrant organisation
Good cash position and access to finance

The right people for TattsLotto

Domino’s approach is different to that of Tatts, the lottery and sports betting shops in Australia, which is highly government regulated. They look for:

Creditworthiness
Business skills
Management skills
Communication skills
No criminal history
Understanding and ability to work in a highly demanding customer service environment
Professional presentation
Ability to follow the system and government regulations

The right people may look different in different countries

Christiane Gaul’s study cited research from the United States, Germany and Spain that found that franchisors in each of these countries used different selection criteria. In the United States, 'attitude toward business' was considered a valuable indicator. There was greater emphasis in Germany on 'soft skills' such as people ability. And in Spain, loyalty to the franchisor and willingness to work hard were highly regarded.

Does personality influence franchisee performance?

Here’s how McDonald’s franchisees in Australia are different from the average person on the street – they’re more notably conscientious, more extroverted and less neurotic. That was the finding of the Personality Traits of Franchisees study by Werner Soontiens and Adrian Lacroix.

“These traits arguably contribute to a stronger franchisee performance and the overall success of the franchise system,” the authors concluded.

But many experienced franchisors and franchise consultants disagree

“I learned that, although somewhat better than making a decision by rolling dice, ‘out-of-the-box’ personality profiles weren't that much better,” says Fred Berni of of Dynamic Performance Systems. “You don’t use personality tests when selecting franchisees.”

Why? Because job-specific situational judgement and job-specific behaviours are more accurate predictors of franchisee performance, says Berni.

"If you met face to face with ten successful franchisees in any system, you would probably walk away thinking: 'There is no way to predict how well these people will perform. Every one of them has a unique personality.'''

"Academics are often way off the mark when it comes to the practicalities of what goes on in real franchise networks," Greg Nathan of the Franchise Relationships Institute told me. "Their research often has small samples and is biased toward existing and limited academic models of understanding the franchising world."

What’s more important—franchisee performance or ‘fitting in’?

“When a franchisee is selected, it should be because they have the potential to perform—not because they ‘fit in’,” says Fred Berni. “‘Fitting in’ has nothing to do with actually performing at high levels.”

But this flies in the face of conventional management wisdom. "Culture eats strategy for breakfast"—the classic quote from management guru Peter Drucker means simply this: No matter how great your business strategy is, your plan will fail without a company culture that encourages people to make it work.

Culture can be defined as shared beliefs within an organisation. In the best organisational cultures, these beliefs lead franchisees to behave in ways that benefit the entire franchise group.

The proof is in the pudding, as they say. Some years ago I took part in a Franchising Best Practice Study Tour from which one of our two key learnings was that a strong organisational culture was a critical success factor in the best-practice franchises we visited. Caterpillar talked about their franchisees bleeding ‘yellow blood’. McDonald’s talked about ‘McFamily’. And outdoor specialty retailer Recreational Equipment Inc. (REI) says that its members give 'life to their purpose'.

Even top performers have to be believers

Top performers in sport, business or any endeavour don’t just get that way simply because they exhibit the traits of top performers. They need something more, something outside themselves, something bigger than themselves.

Where would top-performing sportspeople be without their coach, team or support people? Just as importantly, where would they be if they didn’t love or at least have complete commitment to their sport?

The same applies to franchisees. No matter how much they believe in themselves, in their ability to perform, they’re never going to be perform at their peak unless they believe in the franchise and what it stands for, and take full advantage of everything it offers to turn potential performance into actual performance.

In a franchise, more than other types of business, fitting in actually does have something to with performing at high levels.

How can you be sure to select only high performing franchisees who are a good fit for your franchise?

The honest answer is that you can't. No matter how good your selection process is, you'll never get it 100% right all the time. But you can get close.

The next article in this series will cover best practice processes in franchisee recruitment and selection and review some of the tools which have been developed to help you select only the 'right' franchisees. To be sure you don't miss it, subscribe to our regular email newsletter or follow us on Linkedin, Twitter or Facebook.

It's Business Awards Season! Are You Ready to Win?

robin@noordinary.co.nz (Robin La Pere) — Wed, 17 Apr 2024 23:06:19 GMT

“And the Supreme Franchise of the Year Award goes to…”

I dare not breathe. Why is there always that interminable pause before the winner’s name is announced? My client has already won all three awards that I entered them for – Field Manager of the Year, Franchisee of the Year and Franchise of the Year in their industry category. But will they walk out with the biggie…?

“Signature Homes!”

I can’t begin to describe the elation I feel every time I help a client to win a franchise or business award. It’s as exciting for me as it is for the client.

Businesses enter awards competitions for different reasons – recognition, credibility, ego, media exposure – but to me the most important reasons are the ability to benchmark yourself against the best and use what you learn to continuously improve your business. I take my hat off to those who keep entering awards despite failing to win but keep getting better every year until hopefully… finally…

One of the keys to writing better awards entries, I’ve found, is to understand the criteria for the awards and what the judges are looking for. Of course, the criteria depend on what the award is for – leadership, customer service delivery, marketing, innovation, the list goes on. But I have found that the most common awards frameworks or models in the general business excellence category are the European Foundation for Quality Management (EFQM) Excellence Model and the Baldrige Excellence Framework.

The European Foundation for Quality Management (EFQM) Excellence Model

The Baldrige Excellence Framework

It’s Business Awards season! Time to get your entry together for the local, regional, national or international Business, Industry or Franchise Award of your choice.

Because of my understanding of how the business awards models and criteria work, and my experience in preparing winning entries, I am regularly asked to assist my clients with their entries.

If you think your business has got what it takes to enter, or you’d like to use the awards process as a tool to improve your business, I invite you to contact me for a free Initial Consultation . I am based in New Zealand but I work with businesses, franchises and other organisations all over the world.

What’s the Best Way to Predict Franchisee Performance?

robin@noordinary.co.nz (Robin La Pere) — Wed, 10 Apr 2024 23:09:36 GMT

We all know that success in franchising is largely about selecting the ‘right’ franchisees. Arguably, franchisee selection is the most important decision a franchisor can make. So how do franchisors go about the selection process and what selection tools are on offer?

Inadequate franchisee selection procedures are the biggest single cause of franchisee failure, according to a study by Professor Lorelle Frazer from Griffith University.

Inadequate franchisee selection is also a factor in franchisee performance, which has a direct impact on franchisor revenue and profitability. I have found over my years as a franchise manager, franchise owner and franchise consultant that franchisee performance can be measured in what’s known as a Bell Curve*. Typically there is the top 20%, the bottom 20% and the 60% in the middle. Every sport, every school, every business and every franchise has people who perform along the Bell Curve, according to the theory.

Because another performance model, the Pareto Principle (also known as the 80/20 rule)* says that roughly 80% of a franchisors' royalty income may come from 20% of franchisees, there is a clear incentive for franchisors to shift the Bell Curve to the right, thereby increasing overall franchisee performance and consequently franchisor income.

But if the franchisee selection process is so important to franchisee performance, why do so many franchise systems have inadequate processes?

Of course, for the handful of unscrupulous franchisors who make money through franchisee churn, the attitude is “Who cares?” “Do you have the money to pay the franchise fee?” is the only selection question they need to ask.

Similarly, I have found that new franchisors often take on virtually anybody who wants to buy a franchise, not only because they need the money and to start building some critical mass in their franchise network, but also because in the early days they may not understand what it takes to be a high-performing franchisee.

But if you’re in it for the long haul, you’d better believe that the quality and value of your franchise’s business model, branding, systems and support count for nothing if you don’t have the right people on the ground.

What do the right people look like?

That depends on the franchise business, according to Christiane Gaul of the University of Applied Sciences in Kufstein, Austria, in her study Partner Selection Process in Franchising. Of course, the kind of candidates a franchisor looks for will be different for a lawn-mowing franchise than a professional services franchise.

But selection criteria and processes are also influenced by the franchise company’s age, size, culture, growth ambitions and life cycle stage. For example, as I mentioned earlier, an aggressive startup franchise is much more likely to take risks in franchisee selection than a mature, established franchise, a decision that often ends in a lot of unnecessary franchisee churn or, at worst, disaster.

This is just the first part in our series on Franchisee Selection: Why It Is the Most Important Decision Franchisors Make

Don’t miss out. To make sure you receive more articles in the series, subscribe to our free Email Newsletter or follow us on LinkedIn, X or Facebook.

Why the Best Business Plan in the World Won't Help Your Business (and What Will)

robin@noordinary.co.nz (Robin La Pere) — Wed, 10 Apr 2024 02:15:29 GMT

We’ve all been led to believe that a solid business plan, complete with a genuine vision and values, is the secret sauce you need for business success. How wrong we were.

OK, if that’s not the secret sauce, how about points of difference? Wasn’t it Phillip Kotler or some other Marketing 101 guru who said that’s all you need for successful marketing?

Wrong again.

The best visions and values in the world and the greatest points of difference won’t mean a thing unless you’ve got something else in place first.

A customer who gives a hoot about your product or service. A customer who cares enough to hand over good money for it. Without that, you’ve got nothing. Except for nice vision and values statements, that is. Many a company has gone down in a screaming heap after spending days, weeks, months meticulously crafting these statements and brilliant 198-page business plans.

Even a point of difference doesn’t count if it’s not a point of difference that customers want or need.

What’s the solution?

There are two – a VP + CS. Value Proposition and Customer Segment, that is.

The Value Proposition must be something about your product or service that customers actually care about. The essence. The X-factor. The sharp end of how an organisation creates, delivers, and captures value. Call it what you like, but get it or perish.

The Customer Segment is not just any old customer, but the customer who cares most about your VP and has the most money to pay for it. Your most important customer.

Without a Value Proposition and Customer Segment, you may as well go home and go to bed.

So next time you’re embroiled in a business planning meeting, don’t waste time discussing mission and goals. And don’t waste oxygen by only inviting the marketing team or the HR Manager. Invite the customer. Maybe not in person, although more and more companies do. Invite the customer as a kind of constant metaphysical presence that says, “Without me, you don’t have a business.”

Your Business Plan is not your Business Model

Because the Value Proposition and Customer Segment put the customer front and centre of your business model planning process, they are arguably the most important parts of the business model. This was illustrated in the Business Model Canvas developed by Swiss business theorist and entrepreneur Alex Osterwalder to help businesses describe, design and analyse their business models.

So the business model forms the foundation and encompasses the core idea of a business, while the business plan serves as a detailed roadmap for the implementation of the business’s strategy over time.

At this point, if you’re thinking there’s no point in reading further because your business model is doing just fine, thank you – remember that nothing lasts forever.

Even the most successful business model. Look at Kodak, the world’s leading photography company – until it wasn’t. Look at Blockbuster, the world's largest chain of video rental stores – until Netflix came along. Many of us had Nokia phones when everyone had a mobile – but Nokia missed the boat when everyone switched to smartphones.

And there are thousands of other cases of companies which thought they had bulletproof business models– until they didn’t.

Why should I buy a franchise from you?

robin@noordinary.co.nz (Robin La Pere) — Thu, 28 Mar 2024 00:37:23 GMT

I would like to be able to say this is a question I rarely heard when I was a franchisor, because my franchise recruitment marketing was so good that people already knew the answer before they contacted me.

Unfortunately that wasn’t always the case. When I first started out in franchising, I thought that my obvious passion for the business would be enough to sell truckloads of franchises.

It wasn’t.

I thought my obvious passion for the business would be enough to sell truckloads of franchises.

Although I did sell a few franchises, it turns out that those prospects were already sold on the franchise opportunity and didn’t need a lot of persuading. I’ve learned since then that the best selling isn’t about your wonderful franchise, it’s about your prospects and their needs.

But in my zeal, I was impatient and overwhelmed them with my spiel. I jumped in too quickly when they asked questions and failed to listen for buying signals that may have led to a sale.

I soon learned that in selling franchises, the more time a prospect talks, the higher the probability of getting the sale. Because selling franchises—or selling anything for that matter—is about solving problems and meeting needs.

The more time a prospect talks, the higher the probability of getting the sale

What kinds of problems do prospective franchisees have? Maybe they hate their boss. Maybe they’re unhappy in their job. Maybe they’ve been doing the same thing for too long and need a change. Maybe they’ve never had an opportunity to do what they love. Maybe they’ve checked out several franchises in your industry but are unsure which one to choose.

There are any number of problems that may be key drivers of prospects’ interest in your franchise opportunity ( see more on this here ) but if you want to convert them from prospects into franchisees, you’re going to have to ask the right questions—then listen actively for the answers. Active listening is when you not only hear what someone is saying, but also tune in to their thoughts and feelings. It’s about responding in a way that shows you care and are listening—generally by asking questions rather than making statements.

To convert prospects into franchisees, you’re going to have to ask the right questions—then listen actively

By gaining a better understanding of your prospects’ problems, you’ll be in a better position to match those problems with your solutions—hopefully solutions that meet their exact needs.

You may have ‘sold’ the prospect on buying into your franchise, but they’re not franchisees yet. This is only the first step in the sales process which, as we all know, is a long and complex exercise.

For more tips on successful franchise sales, subscribe to my email newsletter or follow me on Linkedin, Facebook or X.

“Nice work Robin. I read your blogs and find them thoughtful and useful.”

Greg Nathan, Franchise Relationships Institute

Why Aren’t More Australian and New Zealand Franchises Going International?

robin@noordinary.co.nz (Robin La Pere) — Thu, 28 Mar 2024 00:36:16 GMT

That’s the question I asked myself when two of my New Zealand clients asked me for help in expanding their franchises into Australia.

New Zealand has been called the most franchised country in the world and 71% of the franchises here originated in New Zealand, but only around 20% of New Zealand homegrown franchises have entered international markets and the 2021 Franchising New Zealand Survey showed that intentions to expand internationally are significantly lower than in 2017.

Why is this?

Because New Zealand is a small market, you would think that mature franchises would have reached market saturation here and be keen to expand into larger offshore markets. But after being a big fish in a small pond, it’s a scary move to become a small fish in a big pond.

Having said that, the Australian franchise industry isn’t much different. Australia has more franchise outlets per capita than any other country except New Zealand, according to the International Trade Administration.

An impressive 90% of franchise brands originated in Australia, but only 32% are currently franchising internationally. That 71% of these expanded to New Zealand first is hardly surprising given how close the two countries are, not only geographically but in their heritage, language, cultures and legal systems. That they ranked the UK, US and Europe higher than South East Asia in their internationalisation plans demonstrates that geographical proximity is not always the most important factor.

Geographic proximity is not always the most important factor in franchise internationalisation strategy

For example, New Zealand-based companion driving service Driving Miss Daisy, the market leader in their home country, chose the UK as the next step in their global expansion strategy. Why not Australia, which is a simple ‘jump across the ditch’, as we say? The founders no doubt had family or contacts in the UK but other reasons would have included that the public health system there is similar to that of New Zealand, providing subsidies for mobility transport, and as in New Zealand, there are no specific franchise laws there, making it simpler to set up a franchise. In comparison, Australia has a different public health system and fairly rigorous franchise legislation.

Interestingly, the Driving Miss Daisy franchise has recently also entered the Australian market under a master franchise arrangement with the same Australian franchise consultants who helped them expand into the UK.

Has your franchise reached the limit of its growth in your home country? Is it time you spread your wings?

My next blog will explore the pros and cons of international expansion, feature some successful case studies and identify the critical success factors. To ensure you don’t miss it, subscribe to my email newsletter or follow me on Linkedin, Facebook or X.

“Nice work Robin. I read your blogs and find them thoughtful and useful.”

Greg Nathan, Franchise Relationships Institute

The Biggest Mistake Franchisors Make When Selling Franchises

robin@noordinary.co.nz (Robin La Pere) — Tue, 19 Mar 2024 23:36:29 GMT

Would you buy this franchise?

My first question when I came to this webpage from a Google search for ‘franchise opportunities’ was “What is BFT?”

I suppose if I was looking specifically for a fitness or gym franchise, I might have known that BFT stands for ‘Body Fit Training’. But what’s with the image of the crowded street with the funny-looking building at the end?

Which leads to the questions: “Who would BFT’s ideal franchisee be and why would they want to buy a BFT franchise?”

This Own a Gym webpage does a better job of identifying who Anytime Fitness’s ideal franchisee is and why they would want to buy an Anytime franchise.

Someone who wants to make a difference to people’s health and wellbeing as well as making money. Believe it or not, in every survey of why franchisees buy franchises, making money ranks at number 3, 4 or 5.

So why do people buy franchises?

The answer lies in a model for understanding what motivates and fulfills humans, known as Maslow's Hierarchy of Needs.

Of course, every prospective franchisee’s needs depend on their aspirations, situation and resources. But the point to remember is that lifestyle, being their own boss and self-fulfilment are the key drivers of most franchise buying decisions.

Caci Clinic clearly understand the who’s and why’s of franchisee recruitment. Who wouldn’t want to be part of New Zealand's best looking business? Who wouldn’t love doing what they do? And who wouldn’t enjoy helping other people to look and feel their best?

A sense of community and being part of a team is also important in franchise buying decisions, and pointing out that your business has won awards doesn’t hurt either.

No wonder Caci Clinic is one of New Zealand’s fastest growing franchises.

It’s also important in your franchise recruitment marketing to answer the questions, “Why should I buy a franchise from you and not one of your competitors? What’s your point of difference?

If you’re the largest, say you’re the largest. If your product is the healthiest, say it’s the healthiest. Find what sets you apart and promote the hell out of it.

I note that Smoothie King’s franchise opportunities website (www.smoothiekingfranchise.com) is separate from their consumer-facing website. There’s a good reason for this. It’s best practice in franchise recruitment because the target markets are different and that can make a big difference to how easy it is for prospective franchisees to find you.

Who hasn’t dreamed of becoming a rock star? And who, having failed completely at that, wouldn’t want to give their children every opportunity to fulfill their dreams of being rock stars? Especially as getting the School of Rock is the ‘#1 Child Education Franchise’?

Clever marketing.

“Nice work Robin. I read your blogs and find them thoughtful and useful.”

Greg Nathan, Franchise Relationships Institute

How to Break Out of a Sales Slump: Getting from Stuck to Success

robin@noordinary.co.nz (Robin La Pere) — Tue, 19 Mar 2024 05:43:45 GMT

It happens to all of us. We’re born. We grow. We stop growing. There’s nothing we can do about it.

In business as in life, it’s called ‘maturity’. But maturity generally leads to stagnation — and for many businesses, it can also mean death.

Of course, every business is different. But there’s a pattern they all share. It’s called the Business Life Cycle. It looks like this:

You can see why it’s sometimes called the S-Curve. No matter how successful a business turns out to be, sales growth generally start out slow until it achieves great brand recognition. But inevitably, as the business starts to reach maturity, sales begin to stall, together with cashflow and profitability.

Why? There are any number of reasons but some of the most common are:

Increased competition
Disruptive business models
Outdated technology
Changing customer preferences
Complacency and lack of drive
Market saturation
Tired brand image

So what can you do about this? Doing nothing is not an option. Look at what happened to Blockbuster, Kodak, Yahoo, Sara Lee, Toys R Us and a long list of other well-known companies which became obsolete or failed.

All because they failed to jump the S-curve.

You may have noticed the dotted ‘Life Cycle’ Extension line on the graph above. That’s the beginning of the next S-Curve. For businesses, sustaining growth over long periods of time means innovating and pivoting.

Netflix is an example of a company that has a successful history of jumping S-curves. Since it began in 1998, Netflix has faced technological change, changing consumer preferences and burgeoning competition. Now they could be facing an even greater challenge, market saturation. What S-curve will they jump on next?

As you can see, Netflix has stuck to its original purpose of providing in-home entertainment but was quick to take advantage of new streaming technology to change the way it delivered that entertainment. Then the company leveraged its enormous subscriber base to start producing its own original TV series and movies.

It’s not just large companies that need to keep jumping the S-curve in order to thrive over the long term. I worked with a small home building company which has grown to become the largest homegrown franchise of its kind in New Zealand. Here’s how they did it:

In the 1970s and 80s, there was a trend in New Zealand to solid timber homes — and Signature Homes was founded to capitalise on this trend. But the times changed and the company pivoted to the timber-framed homes that are typical in New Zealand. They became a design-and-build or custom home business with a twist — they developed designer home concepts which made it easy for buyers to choose from a range of different styles and customise their new home designs to their exact requirements.

Signature Homes had scaled their business through franchising but the franchise business model and systems were outdated so, in the early 2000s, I worked with them to re-engineer their entire franchise in line with international best practices and implement a change management strategy. You could argue that this was simply an improvement, not jumping onto a new S-curve, but change was so uncomfortable for several franchisees that they left the network. However, despite the loss of one-fourth of the franchise network, sales climbed by 25% across the overall network and enquiries started pouring in from a new breed of franchisees.

Signature Homes had started its journey to becoming the largest Kiwi-owned housing brand but there was still one barrier to success. The new marketing strategy was working gangbusters, bringing in unprecedented levels of enquiry. But many of these enquiries weren’t being converted into sales.

A home is typically the owner’s biggest asset so the decision to buy is an involved and time-consuming one. This is particularly true with design-and-build or custom homes. As any salesperson will tell you, it is so much harder to sell an intangible (such as a home that doesn’t exist yet) than something tangible that you can see and touch. That’s where the ability of the salespeople is vital. They must build a relationship of trust and credibility with prospective buyers.

The problem at Signature Homes, as at most group housing companies, was that although they all had teams of salespeople, the franchisees were mainly builders, few of whom had sales management experience. What could we do about this? One solution might have been to upskill the franchisees in sales management. But that would take time and there was no guarantee of success. Another solution would be for Signature Homes’ head office to employ an expert in the field to help the franchisees manage their teams. I thought I knew just the right person for the job. Last year, Brad Hay (pictured above at left with my wife Margaret and myself) celebrated twenty years with the franchise and is credited with bringing world-class sales leadership, disciplines, systems and accountability to the business.

Ready to jump on to the next S-curve?

Are your sales stalling or stagnating? Are you doing the same thing but expecting different results (and not getting them)? It could be time to jump on the next S-curve.

But how to identify the right way forward and up? That's when an independent third-party - someone who can look at your business objectively with fresh eyes and see what perhaps you are too close to the business to see - could make a real difference.

I specialise in working with my clients to make a difference to their businesses. You could say it's my passion. I invite you to contact me for a free initial consultation to talk about how I could potentially help you to make a difference in your business.

“Nice work Robin. I read your blogs and find them thoughtful and useful.”

Greg Nathan, Franchise Relationships Institute

The results are in: What’s in store for ’24

robin@noordinary.co.nz (Robin La Pere) — Thu, 18 Jan 2024 21:59:18 GMT

Wouldn’t our lives be different if we could predict the future? Think of the massive implications that would have on our businesses. So what’s the best way to predict the future? Studies show that economists, scientists, psychics and other ‘futurologists’ aren't actually very good at it. But one deceptively simple idea posits the question: Are the many smarter than the few?

I decided to test this theory with What’s in Store for ’24 , a readers’ poll to find out what you think and measure the collective predictions in a completely unbiased and anonymous way. I got a surprising 512 responses from people all over the world. And here (ta-daa) are the results:

Are you expecting 2024 to be a better year, worse year or much the same as 2023?

What is your greatest hope for 2024?

What is your greatest concern in 2024?

Do you go to work or work from home, or both?

What are your preferences in regard to hybrid work, no matter what your current situation?

Have you prepared or do you intend to prepare a business plan or personal plan for 2024?

Do you see AI as more of a positive or negative thing for humanity?

How do you feel about sustainability and eco-friendliness?

What goals do you or your employer have for the business in 2024?

What media does your business or your employer mainly use for marketing?

What’s in Store for ’24?

robin@noordinary.co.nz (Robin La Pere) — Mon, 18 Dec 2023 21:32:09 GMT

What are your predictions for 2024? Take our Reader Survey to share your views. It will take just a few minutes and you can do it in complete anonymity — we don’t want your name or any other details about you. We just want your views.

15 marketing mistakes that may be killing your business

robin@noordinary.co.nz (Robin La Pere) — Tue, 05 Dec 2023 19:51:49 GMT

Suffering from slowing sales? Lack of enquiry? Cashflow in the toilet? You’re not alone. These are the kinds of issues that are plaguing businesses of all stripes right now. But now’s not the time to waste time worrying about all that. Now’s the time to take action and get smarter about your marketing – before it’s too late.

The first step is to make sure you’re not making any of these marketing mistakes that, as a marketing consultant, I see businesses making all the time.

Mistake #1: Thinking there’s a silver bullet

Mistake #2: Thinking Marketing and advertising are the same thing

One of the best definitions I’ve heard of marketing is:

‘Marketing is everything you do to gain and keep a customer.’

So advertising is marketing but marketing isn’t advertising. Branding is marketing. Signage is marketing. The way you and your employees treat your customers is marketing – not only before the sale but after it. The most common mistake I see people making is failing to view their marketing strategy as an entire customer experience. Most people focus on just one or a few of these components but neglect the others. One of the most common mistakes I see people making is failing to view their marketing strategy as an entire customer experience. Most people focus on just one or a few of these components but neglect the others.

Mistake #3: Failing to plan

Mistake #4: Writing a book, not a plan

When I was completing my MBA, we were taught that business plans should be highly structured and highly detailed. But having come from the corporate world, I knew that nobody used these kinds of plans except for approvals and funding from higher-ups and lending institutions. As a result, I am a huge fan of keeping it simple – preferably to just one page. There are plenty of templates for this, but one of my favourites is the Business Model Canvas because it is built around the Customer Value Proposition – how your business creates, delivers and captures value. To me, the customer must be at the centre of your marketing plan because without customers, you don’t have a business.

Simple example of a Business Model Canvas for Google

Mistake #5: Failing to work the plan

You wouldn’t believe how many clients have paid me good money to help them write their business or marketing plan – and then forgotten about it. One client even forgot that he had already paid another consultant to write a business plan – just a few weeks before. Forgive me, but here’s another adage that’s totally relevant here:

‘Plan your work and work your plan’

One of my most successful clients co-owned a smallish home building franchise. He was also one of my favourite clients because he was like a bulldog – once we had developed a plan, he wouldn’t let it go. There’s nothing more satisfying for a consultant like me than seeing a plan successfully executed. Every week we would sit down and review progress against the plan. The franchise is now New Zealand’s largest home-grown building brand.

Mistake #6: Thinking the word ‘plan’ is a noun, not a verb

The real value of a plan is not the plan itself but the planning that goes into it and the questions you must consider during the planning process. Who is your customer? What are their needs? How can you best solve their problems? What’s working and what’s not? Planning shouldn’t happen once a year – it should happen all year long.

Mistake #7: Sticking to the plan

What? One minute I’m saying you need to work your plan, the next I’m saying you shouldn’t stick with it. Have I lost my mind? Not quite. There is an old adage that no battle plan survives contact with the enemy. Or, as Mike Tyson is famously known to have said:

‘Everybody has a game plan until they get punched in the face.’

Just because it’s in the plan doesn’t mean it’s going to work. When it doesn’t work, what’s important is how you respond. Sticking to the plan isn’t it. The three golden rules of marketing:

Test, pivot, test

Mistake #8: Not knowing your customers

Mistake #9: Not having a CVP

You’ve no doubt heard about USPs (unique selling propositions) and PODs (points of difference) but you may not have come across CVPs (customer value propositions) until you read Mistake #4 above. USPs and PODs are about standing out from your competitors – otherwise what’s the point of customers buying from you and not them? – but you’ve got to stand out in a way that’s relevant to your customers. Too many marketers forget this. That’s where your CVP (customer value proposition) comes in. In a nutshell, you need to solve the customer’s problem or meet their need in a unique way. In a way that means more to them than the way your competitors are trying to solve their problem.

Mistake #10: Not productising your services

The problem with selling services is that you can’t see and touch a service as you can a product. You don’t tangibly know what you’re getting until the service is completed. Often you don’t even know what the final price will be. This makes it harder in general to sell a service than a product. You must sell yourself – your reputation, your knowledge, your experience – as a service provider. But packaging and pricing your services like a product helps the customer understand what exactly they get for their money without second-guessing the service parameters.

The residential design and build industry is a perfect example. Their customers want a home that is unique to them. But in most cases they’re not sure about the design of their ideal home and what it will cost to build. So almost all group housing companies produce a range of standard home designs, complete with realistic-looking visuals and indicative prices, for their customers to choose from. When the customers see what they like and can afford, the companies’ designers start the process of working with them to customise the design to meet their exact needs.

Another example (and a shameless plug) is the way I have productised the process of franchising a business:

For full details of the best way to franchise your business, click here .

Mistake #11: Not having a clear call-to-action

Have you ever wanted to buy something so badly that you don’t care about its brand, benefits, quality or price? Me either. Research indicates that it takes between 5 and 9 contacts or attempts – in marketing parlance, ‘touchpoints’ – to make an average sale. The way to get a response to your marketing is to make sure you always include a CTA (call to action). Ultimately, of course, you want to sell but the most important thing is to keep prospects engaged. If a person viewing your website wants to know more about your business, product or service, they will look for CTAs such as information downloads, links to other pages on your website or your social media pages, or a free trial of your products or services.

Here is an example of a CTA that you should definitely follow up:

Mistake #12: Not tracking your results

Would you watch a sporting event without waiting to see who wins? Thought not. Yet it’s amazing how many business people spend bucketloads on marketing but don’t really track any results apart from sales. Yes, marketing all comes down to sales. But how can you know if your marketing dollars are being effectively spent if you’re not measuring where those sales are coming from and what’s working and what’s not? OK, I feel another old business maxim coming on:

‘You can’t manage what you can’t measure’

Mistake #13: Thinking that marketing is too expensive and time-consuming

I have to admit that this type of ‘growth hacking’ is more time-consuming than traditional marketing. But these days I employ a virtual team of graphic designers, SEO experts and other marketing specialists to speed things up. And I automate everything I can with smart technology and AI.

A final word: The worst thing you can do when times get tough is to cut back on your marketing. Marketing must be seen as an investment, not a cost. Of course, it is only an investment if it produces a return. But the smarter the investment, and lower the cost, the greater the potential return.

Mistake #14: Thinking you only need to use one medium

When I worked for DDB, then the second-largest advertising agency in the world, the glass lampshade over the boardroom table had a number printed on it in large letters: 1,500. This represented the number of ads that the average person was exposed to in a single day. Today, that number has grown to between 4,000 and 10,000 ads, according to research. They’re not just on your TV, computer and phone, they’re everywhere. Every brand is a form of advertising. So given that level of competition for their customers’ eyeballs, I’m always astonished when a new client tells me they only advertise on Facebook or Google. Of course, I’m not advocating that you use a scattergun or mass media approach. The media you use must be targeted to the right target market. And remember from Mistake #11 that it takes 5 – 9 ‘touchpoints’ to make a sale.

Mistake #15: Thinking you don’t need anybody else’s help with marketing

Of course, I would say that. I’m a marketing consultant. I’ve helped literally hundreds of businesses to gain and keep more customers. But if marketing isn’t your thing, your current marketing isn’t working or you just can’t seem to fit marketing into your busy day, it’s time to bring in some extra help.

Has inflation peaked? Why 2024 could be a better year for franchises and small businesses

robin@noordinary.co.nz (Robin La Pere) — Wed, 15 Nov 2023 06:03:21 GMT

Sharemarkets around the world bounced up yesterday as speculation grew that inflation may have peaked and interest rates hikes may have come to an end. This positive shift in the market is not only beneficial for large corporations but may mean a much-needed boost for small businesses and franchises.

Financial Times World Stock Index 7 – 15 November 2023

Source: Financial Times

Cooling inflation rates around the world have raised hopes for an end to interest rate hikes by central banks, which of course affects the interest rates that small businesses and franchisees have to pay on borrowed capital. Although those banks in the United States, Australia and New Zealand have not indicated when any rate cuts are likely, some economists are picking early-to-mid next year, although that may be optimistic.

Changes in Food Prices by Subgroup October 2023

Source: Statistics New Zealand

In the meantime, food and grocery prices in New Zealand actually fell in October, which may have a more-immediate impact on consumer demand. For small business owners, franchisees and franchisors, lower inflation means lower costs for raw materials, supplies and other operational expenses, which can help improve profitability and provide more room for growth and expansion.

All of these factors have resulted in an upward trend in business confidence in the United States, the United Kingdom and New Zealand, but labour shortages are still a concern in New Zealand as this graph shows.

Business Confidence Factor Constraints

Source: New Zealand Institute of Economic Research

Does all of this mean that we can expect a better year in 2024 than we’ve had so far in 2023?

It’s important to note that these are general trends and the actual impact can vary based on numerous factors including specific industries, locations and individual business strategies. For this reason, small businesses and franchises should continue to monitor the economic environment and adjust their strategies as necessary to maximise these potential benefits.

What are your thoughts?

The secret weapon for franchise success: Do you have it?

robin@noordinary.co.nz (Robin La Pere) — Thu, 02 Nov 2023 00:19:31 GMT

Your strategy can be copied by your competitors. Your products and services can be copied. Your methods can be copied. If these things are giving your franchise a competitive advantage, one thing is sure. Not only can they be copied, they will be copied.

So is there any such thing as a sustainable competitive advantage? Some of the smartest minds in business agree that there is something that can create it, something that can’t easily be copied — and franchisors have a greater opportunity to take advantage of it than the owners of any other type of business.

In the world of franchising, culture is king. More than any other business model, franchises rely on organisational culture as their secret weapon to drive success.

Leading franchises invest heavily in culture building

They treat culture as the cornerstone of their competitive advantage and growth strategy. Some years ago, I was a team leader in a Global Franchising Best Practice Study Tour organised by Fletcher Building. We noted that McDonald’s corporate leaders frequently referred to ‘McFamily’ and Caterpillar claimed their dealers ‘bleed yellow blood’.

A franchise’s culture is something you either get, or you don’t. Burger King’s New Zealand master franchisee bought Hell Pizza, a home-grown franchise that had become New Zealand’s largest pizza chain after Domino’s and Pizza Hut. But after a few years they realised they were the wrong fit for Hell Pizza’s quirky out-there culture and sold it back to the original owners for around one-fifth of the price they’d paid.

But franchise culture doesn't have to be quirky to be successful. US fast food giant Chik-fil-A has embued its franchisees with a mission to give its customers a better experience with fast food. It has made kindness a differentiator. As a result, Chik-fil-A enjoys the highest per-store sales of any comparable fast-food franchise and has to turn away hundreds of applications from hopeful would-be franchisees every year.

There’s a lesson here for franchisors: It always comes back to people.

Why is culture so critical for franchise businesses?

As management guru Peter Drucker famously said, ‘Culture eats strategy for breakfast’. The values, beliefs, and behaviors that make up a franchise’s culture set the tone for how franchisees conduct business and interact with customers.

Unlike company-owned chains which are highly centralised, franchises are decentralised with each franchise independently owned and operated. This means headquarters has limited control over day-to-day operations. Franchise culture serves as the glue that keeps the franchise brand experience consistent across hundreds or thousands of locations.

Strong cultures allow franchises to align franchisees to shared goals and values. This enables new products, services, systems and other innovations to be more smoothly implemented and operated, even without direct oversight. Consistent training and enculturation ensures franchisees embrace the brand identity rather than solely chasing profits.

Why can franchises benefit more from culture than other types of businesses?

Because franchisees are independent business owners, they have a vested interest in the success of the franchise as a whole and, if the culture is right, are more likely to perform at a higher level than employees. They are also more likely to come up with ideas for new products and business improvements, as McDonald’s found when franchisees — not corporate office — came up with the Big Mac and Filet-o-fish, two of the franchise’s best-selling burgers.

Warning: AI Tells Lies

robin@noordinary.co.nz (Robin La Pere) — Wed, 01 Nov 2023 22:48:26 GMT

AI reminds me of when I was travelling the world and the frustration of asking for directions and being pointed in entirely the wrong direction by locals who had no idea where you wanted to go but didn’t want to appear stupid.

It seems that AI doesn’t want to appear stupid either — so if it doesn’t know the answer, it points you in the wrong direction.

I had a case of this when I decided to use a ChatGPT competitor called Claude to research flights to London for my wife and me next year. In just seconds, Claude obliged with two options that appeared to suit my requirements to a tee.

Except that when I did some fact checking, it turned out the options were entirely fake. Sure, the airlines were legit, but there were no flights when Claude said there were and the stated fares were less than half of any fares available at the time.

What was truly bizarre is that when I took Claude to task over its inaccuracies, it admitted that it had lied and rather shamefacedly apologised. Here’s what it said:

Why does AI lie?

‘AI’s fabrication of false content stems from its programming to generate creative, novel content,’ says Govindh Jayaraman, author of How AI Can Be Used in Traditional Businesses to Grow Sales . ‘Language models like GPT-4 do not distinguish between real and fake; they create text based on patterns in the data, which may include fake articles and references.’

So why use AI at all if it can’t be trusted?

I should emphasise that the AI I was referring to above is a ‘chatbot’ AI. There are many other types of AI and they operate differently. Although I use the other types, I use chatbots like ChatGPT more often, mainly to assist me in the work that I do — strategy, marketing and systems development in the franchising and licensing sectors. I must stress the word ‘assist’ — I have learned that while AI is a great tool for producing idea-starters and content, I always need to add my own human input and fact-check everything thoroughly. AI cannot replace human judgement, experience and intuition. Not at this time, anyway.

I have also learned that to get the best answers from AI chatbots, you need to ask the right questions. More on this and some tips and tricks in my next email newsletter — subscribe here .

If you’re not using AI you’re not getting the most out of your franchise - Part 1

robin@noordinary.co.nz (Robin La Pere) — Fri, 27 Oct 2023 02:35:11 GMT

If you’ve heard of AI – and who hasn’t? – but are still unsure how it could impact you and your franchise, then this is the article for you. There are stacks of other articles out there about AI but few that provide practical advice on the ways that franchisors are already using it and how you can actually use it in your franchise right now. That's the aim of this article and the series that follows it.

“There’s going to be ‘AI haves’ and ‘AI have-nots’, and if you are an ‘AI have-not’, then you might as well just rip out all the computers in your office and throw away your phones because that’s how impactful it will be,” according to billionaire and Shark Tank investor Mark Cuban.

As far as we know, Cuban doesn’t own any franchised businesses but Global Franchising claims that AI already “represents a chance to pull ahead of late adopters or competitors that are doing nothing at all while keeping pace with those that have already figured it out”.

And they quote Gus Guimarães, CEO of Qubo Technologies and Systems, as saying, “The separation between early and late adopters of AI is starting to show up in quarterly results across various industries – both inside and outside of franchising – as companies that embrace big data grow faster and reap higher profits, while companies without a plan suffer, with some going to the wayside.”

Scary stuff for those without an AI plan. But who are AI’s early adopters in franchising, how are they using the technology to make more money, both for themselves and their franchisees – and how could you do the same?

Graphic Source: The Keen Folks

Enhancing the Customer Experience with AI

It’s kind of ironic but I find when dealing with my telecom provider that it’s so much quicker and easier to use their online chat function than to try to get in touch with a human by phone. One of the reasons is that my provider’s chat function uses a chatbot to first find out why I’m calling and then provide answers to common questions or issues. This frees up the humans in their customer service centre to get involved only when my issue is more complex than the chatbot can handle.

Chatbots are one of the most common AI applications in franchising. They are available 24/7, can handle multiple customer inquiries simultaneously, let you order instantly and mean that you don’t have to wait in endless queues for some sort of response. Text-driven chatbots have been around for a while but a more recent innovation has been the introduction of Natural Language Processing (NLP) which enables computers to understand and respond to human language. It allows franchisors to automate customer service through chatbots, voice assistants and other conversational interfaces.

How Domino’s is Using Chatbots

Domino’s was one of the very first companies to launch a Facebook Messenger bot that takes orders over chat. Since then, Domino’s has leveraged the use of other popular channels like Alexa and Google Assistant as well with the aim of being ‘the official food of everything’. Contextual messaging enables them to:

Collect user data and design personalided conversational experiences for long term user engagement
Provide seamless ordering facility through Messenger without having a user login with Domino’s again
Improve their impressions over social media and convert a large user base to order with Domino’s

Which Chatbot is Right for Your Franchise?

The use of chatbots is no longer only available for large franchises like Domino’s. There are now a range of chatbot platforms that can be used on your website, social media or app.

Take a look at:

or talk to us about the chatbot solution that’s right for your franchise.

Breaking News: Have Chatbots Really Replaced Phones?

I said above that it’s easier to contact my telecom provider by chatbot than by phone, but that may not be true for long if they catch on to Conversational AI – and if Conversational AI gets more human-like, which it’s close to doing.

Google recently announced they were shutting down Duplex, a groundbreaking new technology when it was introduced in 2018 for conducting natural conversations to carry out ‘real world’ tasks over the phone. The only trouble was that these tasks may have been advanced at the time but in this age of breakneck AI innovation, they’re not everything they could be – although they sounded pretty good to me. ( Click here to listen to some of the ‘conversations’.)

“As we continue to improve the Duplex experience, we’re responding to the feedback we’ve heard from users and developers about how to make it even better,” a Google spokesperson said. “By the end of this year [2022], we’ll turn down Duplex on the Web and fully focus on making AI advancements to the Duplex voice technology that helps people most every day.”

In the meantime, Google has a couple of alternatives that may be helpful in improving your customer acquisition, and enhancing the customer experience, Conversational AI and Contact Center AI . But Papa John’s, the world’s third-largest pizza chain, found that conversational AI is not sufficiently advanced to make customers feel comfortable with talking to a machine, so they compromised and use Cognizant AI to help their human call centre agents streamline the customer ordering experience.

How Franchises are Using AI to Create Personalised Experiences

Personalisation is a key trend in franchise marketing, and AI can help franchises deliver personalised experiences to customers. AI algorithms can analyse customer data such as purchase history, preferences and social media activity to provide personalised recommendations, promotions and offers.

For example, McDonald’s spent US$300 million to acquire Israeli artificial intelligence start-up Dynamic Yield, which personalises products based on customers’ former selections. McDonald’s aim to utilise the technology to customise its drive-through windows to meet changing conditions, including trending menu items, time of day and weather. Taco Bell and Starbucks also use AI to provide personalised recommendations to customers based on their previous orders and preferences. Orangetheory Fitness, F45, CorePower Yoga, GymGuyz and many other franchises use Mindbody AI to create personalised recommendations to clients on fitness and wellness.

Australian and New Zealand franchises are lagging behind in AI adoption – will it make us less competitive?

robin@noordinary.co.nz (Robin La Pere) — Thu, 26 Oct 2023 22:00:14 GMT

9 out of 10 companies around the world believe that implementing AI will be essential to gaining a competitive edge, according to a recent study by MIT Sloan Management.

But that’s not what I found, in the absence of any data on AI adoption by Australian and New Zealand franchises, when I surveyed 20 random franchises across a range of industries in Australia and New Zealand. Only 7 (35%) had implemented or were planning to implement AI as part of their forward strategy.

Does that mean that the other 13 are waiting for the hype to die down before deciding whether AI would add value to their businesses? And if that’s the case, might their AI-adopting competitors get the jump on them?

That decision has already been made by US franchises, according to Jack Monson of leading franchise marketing firm Brand J. There was standing room only at a session he gave on AI at the 2023 IFA Annual Convention .

But while the findings of one study show that 91% of businesses currently using AI say it’s made their businesses more successful, 30% of employers globally cite security risk as their biggest concern about AI in the workplace. Increased margin of error, impact on the team’s work quality and/or productivity, and the risk of losing intellectual property also ranked high on the list of concerns.

Do the benefits outweigh the risks? One of the reasons for slow AI adoption by Australian and New Zealand franchises may be a dearth of quality information and advice specifically for franchisors. In fact, the industry’s peak bodies, the Franchise Council of Australia (FCA) and Franchise Association of New Zealand (FANZ), only recently added AI to their annual convention agendas.

What Does a New Government Mean for Franchising in New Zealand?

robin@noordinary.co.nz (Robin La Pere) — Sun, 15 Oct 2023 22:48:21 GMT

New Zealand’s National Party has traditionally been considered pro-small business, promoting policies that foster entrepreneurship and support local enterprises, but the soon-to-be new government seems more focussed on bringing the cost of living down for middle New Zealand.

So where does that leave the franchising industry?

Understanding their campaign promises is crucial for the franchising community, as it directly affects the regulatory environment, business operations and potential growth opportunities.

Tax Relief and Incentives

The central plank of the party’s election campaign was tax relief measures, but nowhere can I find any reference to lowering company tax. Businesses should benefit, however, from the extra spending power generated by National’s $8.9 billion “Back Pocket Boost”, albeit that this only amounts to a few dollars a week for the average Kiwi (National bunched its figures together across households and fortnights to “try and make the numbers look bigger”, according to outgoing Prime Minister Chris Hipkins).

Streamlining Regulations

The National Party has indicated its commitment to reducing red tape and simplifying regulations to promote business growth and innovation. Like Joe Biden when he came to power in the United States, their first order of business is to toss out any of the previous government’s legislation they don't like. This includes the Fair Pay Act , which sought to standardise wages and employment terms across industries such as hospitality and commercial cleaning, and what the party calls ‘RMA 2.0’, the Natural and Built Environments Act (NBEA) , which will impact the country’s many franchised building companies.

Infrastructure Development

Supporting infrastructure development is another key element of the National Party's campaign promises. Improved roads and transportation networks will benefit the franchising sector by facilitating more efficient supply chains and reducing operating costs for franchise businesses. However, it is a little unclear how the government will pay for this initiative, given that they have also promised to scrub the annual increases in fuel taxes that the previous government proposed to pay for their infrastructure development promises.

Changes in the Consumer Price Index in New Zealand 1990 to 2023

Getting inflation under control

Inflation rates have been coming down around the world and the previous government’s inflation-control strategy was praised by the likes of the International Monetary Fund (IMF) so National tended to downplay their five-point plan to get inflation under control during their campaign.

While there has been some debate about the impact of tax cuts on inflation, further reductions and the subsequent lowering of interest rates would be beneficial to all businesses, not just franchises.

Business Confidence

Statistics show that business confidence almost always lifts when a National-led government is elected and this should boost franchisees' morale and drive more numbers in franchise recruitment. But economists warn that a change in government won’t be a silver bullet for bringing down inflation or fixing New Zealand’s fiscal situation, so my recommendation is not to wait but to take steps now to make your franchise stronger and more resilient.

How to Make Your Franchise More Resilient in These Tough Times

robin@noordinary.co.nz (Robin La Pere) — Wed, 20 Sep 2023 06:12:53 GMT

New Zealand has just come out of a recession and analysts are predicting there’s a 50% chance that Australia will slip into one within the next 12 months. What can you as a franchisor do to strengthen your franchise and bounce back stronger?

1. Diversify Your Revenue Streams

One of the keys to resilience is not relying heavily on a single source of income. What other products or services might complement the ones you’re currently offering? Franchisors don’t have the monopoly on good ideas, so it might pay to encourage your franchisees to explore additional revenue streams within their business model—with your approval, of course. Remember that two of McDonald’s most popular and enduring burgers, the Fillet-o-Fish and Big Mac, came not from McDonald’s itself but from franchisees.

Some café franchises like Gloria Jean’s have diversified by expanding into grocery items. Alongside their coffee shops, Gloria Jean’s now sells coffee beans, coconut milk and festive gift baskets both in stores and online. This has reportedly boosted total revenues by 15%.

Australian fast food franchise Hungry Jack’s jumped into merchandise by launching a line of co-branded hoodies, caps and lunchboxes in partnership with retail giant Big W. Royalties from the store brand have added 3% to total franchise income.

2. Streamline Operations and Reduce Costs

Efficiency is key during tough times. Franchisees can benefit from their franchise’s group buying power in almost every aspect of their businesses, but in my experience, many franchisors simply aren’t making the most of all the opportunities available to them. Now’s the time to start implementing technology solutions, optimising supply chains, streamlining management and modifying your business model to free up resources and serve as a buffer during challenging times, both for you and your franchisees.

Fitness franchise Anytime Fitness has focused on developing more affordable studio formats to attract franchisees and members. They’ve opened smaller ‘micro studios’ that cost less to build out. This lowers the barrier to entry for potential franchisees.

Domino’s Pizza streamline d store layouts and equipment configurations, paring back unused space and items no longer required post-Covid. Restaurants saw energy bills cut 15-25% on average from these ‘density gains’.

3. Enhance Communications and Support

In times of uncertainty, it’s important to keep the lines of communication open between franchisors and franchisees. Regular check-ins, updates and feedback sessions can help build trust and foster a sense of community. It’s important for franchisors to stay positive and optimistic right now. By focusing on the future and working together with franchisees to overcome obstacles, you can help build a stronger, more resilient franchise system that is better equipped to handle whatever challenges come your way, now and in the future.

The Coffee Club launched a new digital portal with educational webinars on topics like pricing, delivery partnerships and marketing.

McDonald’s Australia hosted three free ‘business bootcamp’ conferences in 2023, focusing on financial management, workforce strategies and supplier relationships. Over 90% of franchisees attended each event.

Subway tripled the frequency of store visitation by regional managers, along with phone coaching while F45 added a 24/7 online support chat and established local franchisee networking groups across cities.

4. Strengthen Financial Resilience

Since the pandemic, forward-thinking franchisors have been encouraging franchisees to build financial reserves to weather unforeseen crises. This might involve setting up contingency funds, securing lines of credit or creating flexible financing options. Providing financial education and resources can empower franchisees to make informed financial decisions during tough times.

Subway launched an online budgeting tool to help franchisees better forecast expenses and plan for periods of lower sales. Over 90% found it effective.

Jetts provided no-interest working capital loans to franchisees requiring short-term cash flow support to maintain inventory or staffing levels.

Aussie Disposals negotiated longer payment windows from key suppliers, yielding extra float to ease franchisee cash cycles.

5. Embrace Technology and Digital Transformation

Franchising brands are racing to adopt technology that can both slash costs and boost revenues as the economy softens. More and more franchisors have been investing in technology to facilitate remote operations, online marketing and e-commerce capabilities. They understand the need to help franchisees adapt to new technologies, whether it's implementing a robust POS system, developing a mobile app for customer engagement or turning to AI (artificial intelligence) to supercharge their operations and marketing.

The Coffee Culture loyalty programme transitioned to a mobile app with personalised rewards and promotions to encourage repeat custom.

Cookie Time partnered with a meal kit provider to offer a range of cookie dough kits for home delivery. This expanded their customer reach online.

Domino’s introduced AI-powered Automated Store Management Systems that optimise ordering, production times and routing, boosting throughput by 15% without increasing staff.

6. Revise Franchise Agreements and Terms

Franchise agreements can feel unnecessarily draconic as the economy tightens and franchisees find themselves under greater financial pressure. To be truly successful, franchising must be a win-win for franchisees as well as franchisors. So now might be the time to consider reworking your agreement to include flexible royalty arrangements during downturns, temporary adjustments to support fees or more lenient terms for lease agreements.

ChemDry added clauses allowing deferral of fees for up to 90 days and temporary refinancing of existing debt obligations through the franchisor to avoid defaults in downturns.

Domino’s revised contracts to halt average 5% yearly royalty increases originally planned through to 2025, stabilising costs for operators grappling with ingredient inflation.

Subway introduced new optional variable royalty tiering based on monthly sales levels.

8. Foster Innovation and Creativity

Necessity is the mother of invention and first the pandemic and now spiralling inflation has forced many businesses to adapt quickly to changing circumstances and buyer behaviour.

Franchisors must be prepared to pivot their business models, adjust their marketing strategies and offer new products or services—or risk becoming irrelevant and uncompetitive in a rapidly changing market.

McDonald’s has adjusted its marketing strategies to focus on value-oriented promotions during economic downturns, such as the Saver Menu. They also introduced their McDonald’s Monopoly sales promotion where ‘you can play for a 1 in 4 chance to win from a prize pool of over $296 million’.
New Zealand café franchise Coffee Culture has opened ‘cloud kitchens’ for delivery-only orders processed via food apps, allowing them to operate in suburban areas not feasible for dine-in locations. Delivery now makes up 25% of sales.

8. Get Independent Professional Help

It's always hard to ‘see the forest for the trees’ in your own business. That’s why so many franchisors turn to consultants for a ‘fresh pair of eyes’ on their business and independent advice and guidance. As a franchise and business consultant, I can almost always see what my clients can’t—the underlying and deeper reasons for the issues they are facing. This, I’ve found, is instrumental when I’m working with clients to come up with smart and practical solutions, many of them innovative and groundbreaking. Check out this small sample of examples.

Just some of the value I have added for clients:

Resolved an international licensing issue for entertainment technology company, Magic Memories
Re-engineered Signature Homes’ business and franchise models and helped them build the foundation to become the largest Kiwi-owner home builder
Developed a unique licensing system for agritech innovator Pastoral Robotics and helped them establish a joint venture with a leading agricultural cooperative company

Free Initial Consultation

Call me on +64 9 360 6063 or email me on robin@noordinary.co.nz or send the form below to arrange a 30-minute Zoom or phone chat with no obligation.

5 Mega Trends That Franchisors Need To Be Aware Of #2

robin@noordinary.co.nz (Robin La Pere) — Wed, 01 Dec 2021 04:57:14 GMT

Trend #2: Ghost Kitchens: Threat or Opportunity

for Franchising?

You may never have heard of DJ Khaled (I hadn’t) but the Grammy-winning artist has just launched Another Wing in 150 locations in 5 countries across 3 continents.

Overnight.

How has he done it?

Ghost kitchens.

“Everything I do is big,” says DJ Khaled. “My team and I are focused on launching new partnerships, new ideas and spreading love to my fans all around the world.”

DJ Khaled collaborated with REEF, the world’s largest operator of virtual restaurants with 5,000 tech-enhanced parking lots around North America and Europe. The company raised $700 million to create “Neighborhood Hubs” that will leverage the “power of proximity to connect people and neighborhoods to local goods, services, and experiences,” according to QSR Magazine .

Sound similar to franchising’s business model?

Not all ghost kitchens – also known as cloud kitchens and virtual kitchens – use the REEF model. A ghost kitchen is a shared working space for multiple restaurants to prepare food. The concept is not new but has gathered momentum during the pandemic, when traditional restaurants and fast-food outlets were only able to operate on a limited basis. I remember when restaurant brands such as KFC and Taco Bell began to ‘co-op’, sharing their kitchen and dining space. And I have had several entrepreneurial clients who have centralised their existing kitchens or offered their food prep services to other businesses.

But the new revolution of ghost kitchens have stripped out the cost of bricks-and-mortar dining experiences for the efficiency of pickups and food delivery. Major operators such as REEF, CloudKitchens and JustKitchens (see photo above) offer shared kitchen space or full food preparation services to anyone who wants them. JustKitchens has taken that a step further by also creating its own food brands. And wary of being stuck with just one part of the value chain, delivery platform DoorDash has set up its own ghost kitchens.

restaurantmanifesto.com

It’s only natural that there would be concern for the future of traditional food service business models, especially from those hard hit by the pandemic. But smart operators saw an opportunity. Some set up their own ghost kitchens (see box below). Others rented their kitchens to ghost kitchen operators. Still others took advantage of existing ghost kitchen services to expand their brand and geographical reach.

Even franchises that are household names have jumped on the ghost kitchen bandwagon.

Industry giant Wendy’s Hamburgers announced that they have entered into yet another partnership with REEF and intend to open 700 delivery-only ghost kitchens by 2025. The move could “expose some traditional franchising inefficiencies and force franchising at large to adapt quickly,” said 1851 Franchise magazine.

“If a franchise operates solely out of ghost kitchens, they don’t have to pay anywhere near the real estate or operating costs of a brick-and-mortar location. They don’t need to clean any dining tables or staff a crew to maintain property grounds, while online ordering removes the hurdles of long lines or customer indecision. A Wendy’s ghost kitchen requires space no bigger than a few city parking spaces, which can dramatically decrease company overhead.”

But not all pundits agree. A number of franchise systems have fought back against the trend.

“A ghost kitchen franchise might sound easier to own but is less profitable for most,” insisted Wayback Burgers, an American fast casual restaurant chain with 155 restaurants around the world.

“The number of Americans who are ready and excited to return to in-person dining is steadily on the rise, as pandemic restrictions relax and the world re-emerges from a difficult year. While the ease and convenience of delivery services are likely to remain a popular option among diners for the foreseeable future, a whopping 90 percent of millennial consumers say that authenticity is important when choosing where to spend their money. It is hard to distinguish or differentiate dining options without the benefit of experiencing them in person.”

This article appeared in Entrepreneur magazine before the emergence of the Delta variant so the year may have to be changed.

“From a value perspective, it's easy to understand the appeal of a ghost kitchen,” says the article.

It points out that although the real money for ghost kitchens is in their own brands, they must initially leverage the power of well-known brands to build their customer bases.

“Ghost kitchens need the street cred of an established brand,” says Entrepreneur. But they “will only pay fees and royalties to a brand long enough to get market share. As soon as they do, they bring everything back in-house to sell their own proprietary brands.”

There are two other reasons for thinking that the rise of ghost kitchens may be short-lived.

Brand experience and food quality.

The images above were posted by Produce with Pamela. Big fans of YouTuber MrBeast, Pam’s two sons begged her for McBeast Burgers. “Of course we had to try it!” she says, but concluded from the experience that “I’m not sure this [ghost kitchen] concept is right for most brands.”

The reason? Choosing pickup rather than delivery, the family had trouble finding the ghost kitchen. “There was this mysterious blue trailer with no visible MrBeast branding at the end of the tiny parking lot,” says Pam.

The burgers, when they turned up, were OK but the fries were “meh”.

“I don’t think too many brands would survive in this environment,” says Pam. “A little bite of MrBeast was enough to make my kids happy, but I don’t know if they’d want to go back.”

5 Mega Trends That Franchisors Need To Be Aware Of #1

robin@noordinary.co.nz (Robin La Pere) — Tue, 30 Nov 2021 00:01:08 GMT

Trend #1: Celebrities and Influencers Take Charge

Celebrity endorsements are nothing new in marketing but these days celebrity involvement has gone beyond mere participation.

Earlier this year, McDonald’s collaborated with Korean pop band BTS to ‘create’ the BTS Meal based on their own personal preferences on McD’s South Korean menu. The collab was credited with helping sales soar nearly 26% in the last quarter at US restaurants. And never one to miss a merchandising opportunity, the chain has also partnered with the K-pop superstars on a line of limited-edition T-shirts, hoodies, flip-flops, robes and even umbrellas.

Now the chain is covering other music genres by partnering with pop queen Mariah Carey and hip-hop artist Saweetie .

These collabs are part of a new brand strategy called “Accelerating the Arches” with which McDonald’s hopes to turn more customers into fans by “investing in new, culturally relevant approaches”, according to Fast Company . These approaches mean redefining tradition celebrity brand collaborations and transforming them into “authentic partnerships consumers can trust”, says Afrotech .

It’s not just McDonald’s who have jumped on the celebrity branding bandwagon. Puma has partnered with Rihanna, Guess with A$AP Rocky, GH Mumm Champagne with David Guetta and Keds Footwear with Taylor Swift. Other franchises which have jumped on board include Subway with Serena Williams and other sports stars promoting its Eat Fresh campaign and Burger King with rapper Nelly promoting its Keep It Real campaign to remove 120 artificial ingredients from its menu.

A related trend is celebrities buying franchises – or being handed them in return for their endorsements and involvement. Franchises have long been popular investments for celebrities, with mutual benefits for both parties – celebrity involvement is powerful marketing for the franchise and increases the franchises’ value for all stakeholders, including of course the celebrity franchisees. It is reported that NBA superstar Shaquille O'Neal owns 155 Five Guys Burgers and Fries, 40 24-Hour Fitness and 17 Auntie Anne’s Pretzels franchises. Other big-time celebrity franchisees include Magic Johnson (Burger King), Jimmy Buffett (Krispy Kreme), Kanye West (Burger King), Venus Williams (Jamba Juice) and Pharrell Williams (Fatburger).

Hollywood actor Mark Wahlberg decided to go the other way and start his own fast-food franchise, Wahlburgers. The founder of CNN, Ted Turner, set up the Ted's Montana Grill franchise. In New Zealand, motorcycle road racing champion Mike Pero went on to establish successful mortgage broking and real estate sales franchises. And some people have become celebrities as a result of the franchises they have built. After turning Nikita Hair, one of Europe’s leading salon franchises, into a household name, Inger Ellen Nicolaisen became famous for her hit television series, The Candidate , a European version of The Apprentice .

So many celebrity and influencer initiatives are finding success because people – and especially younger people – have less trust in brands than they once did, according to Sam Wick, head of United Talent Agency.

“Younger consumers especially are looking for brands that they can connect with by understanding the company’s story,” says Wick.

If you're a franchisor looking to enhance your brand and sales by working with celebrities and influencers, it is important to remember that you don't necessarily have to work with international stars. Those recognised on a national and even regional or state-wide level can have even more sway locally than Rihanna. Some years ago, I worked with 16-year-old Valerie Adams before she became a four-time world champion sportswoman. Because she was an up-and-comer and well-known in her community, the campaign was incredibly successful.

Why This is the Perfect Time to Franchise Your Food Service Business

robin@noordinary.co.nz (Robin La Pere) — Sat, 23 Oct 2021 23:25:39 GMT

Operating a business is tough in any climate. So why would you think about expanding your business in the midst of a pandemic?

newstalkzb.co.nz

Here's the first reason. If your restaurant, cafe or food service business is doing OK in Level 2 or has pivoted during the lockdowns in Auckland and Waikato, you could be ideally positioned to take advantage of all the food service premises that are becoming or are about to become vacant, according to the news report above.

It's not a nice thought, I know. But as the saying goes, when one door closes, another opens. Or in this case, the same door opens again. For you.

nzherald.co.nz

This is the second reason why this could be the perfect time to consider expanding. Because the Government may pay you to consider it. Contact me to find out how you can take advantage of the Business Support Package to develop your business.

restaurantdive.com

Reason 3: Auckland and Waikato are going to come out of lockdown sometime soon. And when they do, oh boy! Aucklanders and Hamiltonians are going to want to make up for lost time.

And smart food service business owners and franchisors are going to be there to take full advantage of "a market primed for expansion".

To find out if your restaurant, cafe or other food service business is ready to be franchised, take my Franchise Feasibility Assessment and get your FREE Franchise Feasibility Report in just two minutes !

Scale Up Your Business In 5 Steps

robin@noordinary.co.nz (Robin La Pere) — Wed, 20 Oct 2021 07:14:52 GMT

Want your business to fly? Here are the 5 steps you need to take.

Step 1: Create a Scalable Business Model

You may have a successful business, but is it scalable?

If it is, what is the best way to scale? What strategies, systems and other resources will you need? What will it cost and what ROI can you expect?

Step 1: Create a Scalable Business Model

You may have a successful business, but is it scalable?

If it is, what is the best way to scale? What strategies, systems and other resources will you need? What will it cost and what ROI can you expect?

Step 2: Get the Right People on Board

Your business may be right for scaling, but are you?

The old ways of getting franchisees, licensees, partners or agents on board no longer work. But my new programme has been achieving outstanding results.

Step 3: Build a High Performance Culture

To transform your team, start by tossing those old manuals!

Recruiting the right people is the most important thing you can do. We use more effective training techniques and technology to supercharge your team and deliver better results.

Step 4: Make Your Business Anti-fragile

"What doesn't kill us makes us stronger" – that's anti-fragility.

Once, businesses had to be ‘agile’ and ‘resilient’ to survive. Now, your business needs to be anti-fragile – actually able to grow stronger in the face of crisis and change.

Step 5: Contact Me for a Free Initial Consultation

What’s the surest way to fail in business? It’s to never rise above the ordinary, never stand out from your competitors. That’s why I call my consultancy No Ordinary Businesses and Franchises.

My name is Robin La Pere. Unlike some franchise consultants, I have actually run and owned franchises. And unlike most, I will tell you upfront if I don’t believe you or your business is suited to franchising or if I think there is a better way to scale.

Why grow your business when you can scale it?

robin@noordinary.co.nz (Robin La Pere) — Tue, 19 Oct 2021 01:22:32 GMT

What’s the difference and why does it matter?

Most of us think that to grow a business, you need to throw more resources at it – that is, money, people and technology. But that’s not necessarily the case.

Struggling to pay his way through university on minimum wages, 17-year-old Fred DeLuca decided to try to boost his income by starting his own business. He talked a family friend into lending him $1000 and set up a sandwich shop, Pete’s Super Submarines. Ten years later, the former broke med student had 16 stores. But then the business’s growth exploded – and in one more decade, had more than 500 stores. Today, the business, renamed Subway in 1978, is the world’s largest food service chain, with a reported 44,000 stores worldwide.

How did DeLuca do it?

By scaling the business rather than growing it in the ‘normal’ way. Scaling enables you to increase your sales without a substantial increase in resources. There are several different ways of scaling. Fred DeLuca chose franchising.

Why franchising?

Other ways of scaling – think venture capital and joint venturing – generally involve sharing your business with your investors or partners. Franchising doesn’t. Like other ways of scaling, franchising employs other people’s time and money in order to grow, but you – the franchisor – retain complete control of your own business and all the valuable intellectual property (IP) in it. Instead, you grant your franchisees the right to use your business model, brand and other IP. But only for a certain time and in a certain place. And in return for regular payments, known as franchise royalties.

In fact, franchising is a lot like other business models we take for granted every day.

Renting out a house or commercial premises. Loaning out money. Leasing out a car or equipment. In these cases, the rights to use something of value are made available, but there is no transfer of ownership. The same general principle applies to franchising.

To find out if franchising could be athe ideal way to scale your business, answer these 10 questions and get your INSTANT Franchise Feasibility Report . It’s free and takes less than 3 minutes.

Is remote work working for you and your team?

robin@noordinary.co.nz (Robin La Pere) — Thu, 16 Sep 2021 23:44:19 GMT

Franchisors share their secrets for managing remote teams.

Organisations have increasingly recognised that their culture can give them a competitive advantage because, unlike strategy, it cannot be easily duplicated. Great franchisors have always known this and have become adept at building culture across their distributed teams. The many business leaders whose workforces have been forced by the pandemic to start working from home have much to learn from these franchisors.

Traditionally, organisational culture was signalled by workplace settings and the interactions of the people working in them. But even before the pandemic, that was changing. The pandemic has caused the trend to spike but even in places where lockdowns and other restrictions have been lifted, 89% of those working remotely said they would still prefer to work from home at least part of the time, according to a Boston Consulting Group survey.

Many businesses which have allowed their employees to work from home are reporting increased engagement and productivity. That’s all well and good for individuals. But what about the team dynamics that are the foundation of many organisations’ competitive advantage? How do you provide team members with the sense of belonging, involvement and sharing that are so important to organisational culture? When they’re sitting alone in their home offices or bedrooms, how do you get them to spark ideas off each other?

Some time ago, I participated in a Franchising Best Practice Study Tour where we identified some of the world’s greatest franchises, including McDonald’s, Ford and Caterpillar, and sat down with their top management to find out what makes them great. Two key findings emerged. One of these was that they all of these exhibited strong organisational culture – despite the fact that they operate right across the globe. McDonald’s talked about ‘McFamily’. Caterpillar said their dealers ‘bleed yellow blood’.

How do they do it? And what can other franchises and businesses learn from them?

In Part 2 of this Blog, I’ll reveal how these and other best-practice distributed businesses are able to:

Build ownership and the feeling of belonging in remote franchisees and employees
Foster team spirit and camaraderie in distributed teams
Develop cross-functional collaboration
Increase trust among team members
Stimulate the conversations that drive ideas and innovation
Onboard new team members
Increase individual and team productivity and the business’s bottom line

Make sure you don't miss it! Follow me on social media or subscribe to my email newsletter here:

Never Waste a Good Crisis: Why Now is a Good Time to Franchise Your Business

robin@noordinary.co.nz (Robin La Pere) — Tue, 23 Feb 2021 21:22:13 GMT

“Never let a good crisis go to waste.”

Winston Churchill said it during the bleakest days of World War II — and we can still learn from his observation today as we grapple with the new normal of lockdowns and social distancing.

Churchill's meaning was simple but profound: Every major upheaval in the world inevitably uncovers fresh insight and new opportunities for growth. And that has never been more true than today.

Why is now a ‘good’ time to franchise or expand your business?

1. Low interest rates

With borrowing interest rates at an all-time low, investors are looking to obtain better returns by putting their money into business opportunities

2. Higher unemployment

Although the job losses caused by lockdowns and reduced international travel have not been as massive as initially expected, unemployment is up all over the world and many people without jobs are looking at business opportunities as an alternative to looking for work.

3. New opportunities

During the pandemic, many old ways of doing business have had to give way to new ways, with the result that many of us stuck in lockdown have had the time to explore new business opportunities that may not have existed before.

4. Working from home

Studies show that many of us didn't actually feel 'stuck' at home during lockdowns but enjoyed not having to waste time with a daily commute or having the boss breathing down our necks. These same studies also show that productivity didn't suffer from working from home, either — in fact, in many cases, productivity went up. Many who are not looking forward to a return to normal are considering ditching their jobs for contracting, freelancing, self-employment or home-based businesses.

5. Government support for businesses

Stimulus packages during the pandemic have not only been for individuals — businesses, too, are benefitting from government hand-outs, subsidies and free or low-cost loans. This has made it possible for many of us to achieve our dream of going into business for ourselves.

6. Franchising provides an easier entry into business

For those who have never been in business before, franchises represent a kind of security blanket. Of course, there's no guarantee of success but franchises offer a business model, a brand, operating systems, and training and support.

Another Challenge for Franchising? (And What We Must All Do About It.)

robin@noordinary.co.nz (Robin La Pere) — Tue, 23 Feb 2021 21:22:13 GMT

Last week, I came across a marvellous new online service called Hnry, an app developed in New Zealand that promises to automatically pay and file taxes for self-employed Kiwis so you “never have to think about tax again”.

Sound great?

“Another disrupter for the franchise industry to deal with,” said my friend in the franchise industry when I told him about it.

His comment made me think about Uber and the taxi companies. Apparently the ridesharing platforms are making life tough for the taxi industry, especially with international tourism closed down because of Covid.

Is that the taxi companies’ own fault?

Among the things I like about Uber is that it’s not only cheaper but also more convenient and user friendly. I like that you can use your phone to instantly arrange a ride, rather than waiting at a taxi rank or making a phone call (hailing cabs is not something we do a lot of in New Zealand). I also like that instead of having to complain about poor service, you can just give an offending driver a low rating (they can give you a low rating too if you’re an inconsiderate rider). If their average rating falls below a certain level, they get kicked out. So they’re incentivised to provide better service than a lot of taxi drivers I’ve met.

If you can’t beat ’em, join ’em

The taxi industry in New Zealand was slow to respond to the ridesharing threat. Uber came to New Zealand in May 2014 but it wasn’t until 2020 that Taxicharge, a billing company owned jointly by 16 taxi firms across New Zealand, decided to buy out New Zealand-founded ridesharing company Zoomy and start using their technology. Now those taxi firms plan to start competing more strongly with Uber and the rest by recruiting “thousands of drivers” who will operate on both the app and as traditional taxis.

Too little, too late?

First cab off the rank to test the new Zoomy app was Wellington Combined Taxis. WCT Chairman Dave Clyma said Zoomy has always been able to compete on price with its bigger competitors, but had struggled to get enough cars on the road.

“With our fleet of 500, the waiting time problems should disappear,” he said.

But the big question is, has Taxicharge left it too late? Although its member firms have a total of 3,000 taxis throughout New Zealand, Uber now claims it has more than 7,700 drivers.

Can environmentalism and patriotism offer a competitive advantage?

Uber comes originally from the United States. Ola and newcomer to New Zealand, DiDi, started in India and China respectively. Zoomy is the only app amongst the major ridesharing players that was developed in New Zealand.

So will an appeal to being “guilt-free” and “Kiwi-as” be enough to give Green Cabs an edge in the market? I love their blurb on Google Play:

“Your homegrown 100% NZ owned flash-as transport app. If you want to RIDE in style and support NZ owned companies who leave their profits in the NZ economy, and support the local communities, this app is for you. If you know about ‘blowing on the pie’, and you can ‘handle the jandal’, download this app to hook you up with our answer to the seriously uncool competition.”

Unfortunately this wasn’t enough and the firm was placed in liquidation in the early days of the pandemic. It now only operates in Queenstown.

Stop trying to sell quarter-inch drills

When I was doing an MBA course at the University of Auckland, we had to read Theodore Levitt’s ‘Marketing Myopia’. The article is a classic, required reading in just about every marketing course in the world. In it, Levitt says we’re too focused on producing goods or services and don’t spend enough time understanding what customers want or need.

“People don’t want a quarter-inch drill,” he used to tell his students. “They want a quarter-inch hole!”

Here’s my point

In a world where innovation is happening faster than ever, competitive advantages in business have become more temporary than ever. There’s an urgent need in franchising to keep up – and if possible, to lead. I’m thinking here of Domino’s and their testing of drone and robot delivery. I’m thinking of McDonald’s and their self-order kiosks.

The good news is that so much technology is available off the shelf.

If I owned a taxi company right now, I would be looking at a white label ridesharing app such as Moovit to help me compete and improve my user experience.

If I were the friend I mentioned at the beginning of this article, I would be considering Hnry as a way of further differentiating my franchise offer.

And if I were you, I would be talking to me about the challenges facing your industry and business right now and how to utilise innovation to gain a competitive advantage!

Worried that your competitors are leaving you behind? Don't worry – take action!

I would love to work with you to help you create a brighter future for you and your company. I invite you to take advantage of my free Initial Consultation to talk about your worries, share ideas and consider a plan of action – all at no cost to you.

The Future of Food Is Automated

robin@noordinary.co.nz (Robin La Pere) — Tue, 23 Feb 2021 21:22:12 GMT

From the field to the table, labour is one of the most expensive components in growing, harvesting, distributing, preparing and serving food.

It’s also one of the hardest components to come by. Here in New Zealand, our famous kiwifruit are rotting on the vines because in the face of international travel restrictions and a reluctance by New Zealanders to work at seasonal jobs, there simply aren’t enough pickers. The pickers from the Pacific Islands who normally fly in to do the work on temporary work visas are unable to enter the country because of Covid restrictions.

How is agribusiness is coping with rising labour costs and turnover?

By implementing automation and artificial intelligence (AI) in their operations, according to the Boston Consulting Grou p. But so far only leading players in the industry have been able to afford this. BCG warns that to remain competitive, other food producers and processors must also automate or die.

Read the BCG article here >

A New Zealand company is working on a solution

More than 3 billion kiwifruit must be harvested each year, according to Robotics Plus, a Christchurch-based firm that has emerged, they say, from the need to solve the growing challenges in global primary industries. They recently developed a kiwifruit-picking robot (pictured below) which could be the future of orchard work and help curb the worker shortage in the industry.

An automated system to grade and pack kiwifruit developed twelve years ago by the School of Engineering and Technology at New Zealand's Massey University, in conjunction with kiwifruit marketing organisation Zespri, is now widely used in the industry.

How the Covid pandemic has accelerated existing trends

Many of the current investments in automation and AI technologies were already well under way before Covid-19, according to the Brookings Institution , a Washington DC-based not-for-profit with the mission of conducting research that leads to new ideas for solving problems facing society at the local, national and global level. But there’s no doubt that the pandemic has accelerated the trend.

The Institution acknowledges that the automation of the agriculture, food, and related industries may be alarming to some because these industries employ one in ten workers in the United States. But health and safety issues during the pandemic combined with the rising cost of labour will fuel the continued growth of automation and AI in the future, they predict.

Read the full Brookings article here >

The future of automation in foodservice

“We’re not quite there yet, but the ability to supplement or replace human labor with automated solutions is fast becoming a lifeline for many foodservice operators,” says Food Service Equipment and Supplies .

Despite four out of ten consumers saying in an Oracle survey that they’d visit a restaurant less often if it used greeting robots, ordering kiosks are now commonplace in the likes of McDonald’s. At the back-of-house, California-based Zume Pizza uses pizza-making robots — named Pepe, Giorgio, Marta, Bruno and Vincenzo — to handle repetitive, low-skill and potentially risky tasks such as dough pressing, sauce spreading and placing pizzas into the 800-degree ovens.

Read the Food Service Equipment and Supplies article here >

What's stopping the food industry from automating?

Figuring out how and where to apply new technologies and finding money to pay for them are major challenges, says Warren Solochek of market research company NPD Group. But an equally important challenge is deciding when to invest.

“Technology changes so fast that it keeps a lot of people on the sidelines,” he says. “They know that soon after they make the investment it will probably be obsolete. The argument that you can amortize the cost over eight years or so sounds good, but what happens to that investment if the technology changes in two years?”

No Ordinary Blog

Franchising 2025: What’s Next and How Leading-Edge Brands Are Paving the Way

As a franchise consultant, I’ve had the privilege of working with brands that are reshaping industries and challenging the status quo.

1. Economic Volatility and Fluctuating Consumer Confidence

McDonald's Monopoly Promotion

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Domino's 'Emergency Pizza' Promotion

Boost Juice's App-Based Rewards

Starbucks Seasonal Promotions

2. Increased Adoption of AI and Automation

RobotLAB is the first and, so far, only robotics franchise

YUM! Brands expands its AI-powered customer experience

AI revolutionising care services at Radfield Home Care

Want a fresh pizza? Try Sbarro

3. Customised Franchising Models

The UPS Store offers franchisor-backed financing options

Franchisors collaborating with Franchisee Associations

4. Localised and Culturally Specific Models

Different strokes for different folks

Anytime Fitness: A fit for locals

Marriott tailors its hotels to meet local cultural expectations

Marriott tailors its hotels to meet local cultural expectations

5. Multi-Brand and Multi-Service Offerings

Creating more millionaires than any other franchise in Australia

Encouraging franchisees to operate multiple brands

Focus Brands now known as Go To Foods

This is where it all gets confusing

Will you lead the change and reap its many benefits—or sit back and watch your franchise or other business lose its competitive advantage to others?

Will New Franchising Regulations ‘Destroy the Franchise Business Model’?

McDonald’s certainly thought so.

Could these regulations dismantle the very foundation of the franchise business model?

Are these changes necessary guardrails or disruptive overreach?

Some of the new regulations and how they may affect franchising

Australia’s Tightened Code of Conduct

The Joint Employer Debate in the United States and Australia

The European Union’s Franchisee Protections

The arguments for and against stronger franchise regulation

Advocates for Regulation

Opponents’ Concerns

Will These Changes Really Destroy the Franchise Model?

The short answer: Probably not, but they could force significant evolution.

Lessons from History

Rather than destroying the franchise model, these new laws may serve as a catalyst for reform

For franchising, change is here. How the industry responds will shape its future.

Will you lead the change and reap its many benefits—or sit back and watch your franchise or other business lose its competitive advantage to others?

Meaningful, profitable change starts with a free Inital Consultation with me online or by phone.

Book your free Consultation and get on the fast-track now.

Private Equity and Franchising: A Match Made in Heaven or a Recipe for Disaster?

$8 billion.

That's the jaw-dropping amount that Blackstone private equity just paid for Jersey Mike's, a submarine sandwich franchise with just 3,500 stores.

Did Blackstone pay too much for Jersey Mike's?

Here's my analysis of why a relative upstart was able to command a purchase price almost as high as the industry leader—and what you'll need to do to maximise the value of your franchise.

1. Revenue and Sales Performance:

2. Market Saturation and Growth Potential:

3. Brand Perception and Customer Loyalty:

4. Operational Efficiency and Profit Margins:

Scale, Consistency and Change:

Can Subway turn itself around with Roark Capital's help?

But if Domino's could turn itself around, why couldn't Subway?

This article is Part 1 of a series on Private Equity and Franchising:

A Match Made In Heaven Or A Recipe For Disaster?

To be make sure you don't miss out on Part 2,

subscribe to my free weekly email newsletter

Want to get on the fast train to a better business valuation?

Contact me for a free consultation

Thinking of Rebranding? Don’t—Until You’ve Read This

Companies rebrand for all sorts of reasons. Staying relevant in a changing market is just one of them.

But Jaguar had to do something.

Times have changed.

"Do you sell cars?"

People these days don't buy products.

Tesla has a different branding approach.

I have been involved in the world of branding and marketing for many years.

This is the first of a series of articles and videos about one of my favourite topics—branding.

Why Your Search Engine Marketing Isn’t Working—And What To Do About It

The Rise of AI in Search

The Impact of Zero-Click Searches

Challenges for Independent Websites

Adapting to the New Search Landscape

Brand Not Working? Don't Try This.