While working as a Pan Am pilot in the late fifties, Jim Zockoll visited the UK and stayed in a London hotel – with a blocked drain. At the time, he was also running a drain and sewer business in the US, and agreed with the hotel that he would fly home and return with his equipment in order to unblock the drain.
Jim ended up establishing a drain business in the UK – Rotary Rod, which became Dyno Rod in the early sixties. He re-located to London and, in 1963, set up a national franchise. He started with 40 Dyno Rod franchises and ended up with 160. In 2004, the business was sold to British Gas for £57m.
Zockoll now runs franchise consultancy Zockoll Group. The company has supported more than ten UK franchises since its inception – the latest being London-based property maintenance and refurbishment company, aspect.co.uk. Here are his op tips on establishing and running a successful franchise operation:
1. Those keen to set up a franchise must have an existing and profitable business, and a proven and piloted concept that has the ability to produce sufficient margins for both the franchisee and franchisor. Aspect.co.uk founders William Davies and Nick Bizley have worked in the business since 2005 – they know all there is to know, and can pass this knowledge and experience on to their franchisees. You can’t buy experience, but you can clone it.
2. Find the right person (franchisee) who shows a keen interest in the business, will be wholly committed to it, and who is hungry to strike out on their own. Ask them to bring their wife, partner or parents along to the initial meeting, so that you can explain (to all parties) the level of commitment that will be needed to make this a success. The hours are likely to be long and anti-social (particularly in the set up stages); franchisees will be eating, sleeping and breathing the business – seven days a week.
3. If the franchisee feels like the right fit, but they don’t have the finances up front, then take a risk. Come to an agreement to make this work, for example an increase in monthly royalties, until the investment is covered.
4. BUT make sure that you do not discriminate and offer one thing to one franchisee, without offering the same to others in the network.
5. Treat your franchisee as an equal. They are also business owners; they’re simply paying you for your business experience and acumen. And, you too will learn from them as you progress the journey; listen to their feedback and adapt, if needed.
6. Put your franchisees in second place – after your customers.
7. Coordinate regular meetings with the franchisee, and get togethers for the entire network of franchisees. Setting up on your own can be a lonely business, and the network needs to see that they have your full support.
8. Keep an eye on your franchisees development, don’t let them become complacent when they are doing well, and – as such – allow them to drop their standards. Keep on your toes, and cut down their area, if needed.
9. Set guidelines on your pricing, and make sure this remains consistent across the network.
10. Continue to innovate in your field, and develop new products and services to ensure the business keeps its competitive edge.
11. Find a niche in the market. For example create a brand that is short, descriptive and suggestive of your business and can be a registered mark a name or a telephone that the public can easily resonate with and remember. For aspect.co.uk, the company went with 0800 ONE CALL – there is only one 0800 ONE CALL.
By: Kate Bassett http://realbusiness.co.uk