Franchisor Finalist Focus: bfa HSBC Franchisor of the Year 2013

In the final part of an in-depth look at what helped franchisors stand out for this year’s awards, it’s time to focus on the most prestigious accolade in UK franchising – the overall bfa HSBC Franchisor of the Year. The winners will be declared on Thursday evening at a sold-out gala dinner in front of almost 300 guests.

Six outstanding companies all completed excellent presentations to the judges, who were left with a lot of headaches trying to determine the Gold, Silver and Bronze award winners. There were absolutely compelling, and wonderfully diverse, stories to be told, and here’s a snapshot of what made the final six stand out from the pack as the exceptional franchisors of the last 12 months:

Agency Express
Although first-time entrants in the awards, Agency Express are certainly not to be taken lightly when it comes to the judging. Theirs is a story of impressive innovation, investment and support, which have secured strong results for the franchise network of the UK’s largest ‘For Sale’ board company – and all against a backdrop of the property market downturn and wider economic malaise, which could easily have had the opposite effect on sales.

There’s been substantial investment: in excess of half a million pounds has gone into Signmaster3, their bespoke online board management and invoicing system; the free Property Activity Index report, re-launched with new staff taking responsibility for it, has developed into a key indicator of the state of the UK housing market and provides great PR locally and nationally; a Route Optimiser plans the most fuel- and time-efficient visiting schedule, especially great for multi-van operators; a new website; new central invoicing functions to remove a lot of paperwork from their franchisees; and new data analysis and stock control tools to reduce stock shortage and increase profitability.

The results speak for themselves. In the last 12 months, Agency Express has trained and launched 26 new franchisees; franchisee turnover is up by 27%; new clients are up 16%; and 5 franchisees took on their second territory, with 39 new vans in the fleet overall in 2012. 12 more had already been added by early 2013, with Agency Express’s deal to pay the deposit on new vehicles for a franchisee’s 2nd van reaping dividends for the network and encouraging multi-van businesses.

Remarkably, the franchisor has borne the cost of most of these developments themselves, with no marketing levy charged to their franchisees for them.

The franchise says that 18 of the top 20 estate & lettings agencies use it to erect and manage their sign boards and that over 40% of all UK boards have been erected by its franchisees. All signs point to Agency Express being a major player for many years to come.

Dream Doors
As a retailer, and one which might be said to be operating in a ‘luxury’ market that would suffer during the downturn, one might expect it to have been a tough time for a kitchen refurbishment franchise such as Dream Doors.

Not a chance. The company has been setting records aplenty and then beating them again on a regular basis. Dream Doors grew by 38% last year; like-for-like sales, just comparing apples with apples, showed a 22% growth! These truly remarkable turnover performance figures look set to be smashed again this year, as 2013 started with four consecutive record months – with January, of all months, seeing highest-ever turnover for the brand, and each month since has increased this further.

It’s no fluke either – started with just £500 and now turning over in excess of £18m, franchisee sales have increased each year since they were established in 2002. And in the last 3 years alone, in the midst of a brutal economic period, network turnover has doubled.

Strategy has been kept simple – ask franchisees what they want. Answer: more leads and more sales. So that’s exactly what MD Troy Tappenden had his team set out to do, with three clear goals: 1. Generate more enquiries; 2. Convert more into customers; 3. Improve margins.

Focused marketing, targeting their largest sales demographic – older homeowners – was developed in consultation with franchisee marketing representatives from the network and a design agency. Referral and recommendation schemes and new online marketing strategies are reaping rich dividends for the network (online sales are up 130% on the year).

Showrooms are now encouraged for franchisees within six months, yielding typically a minimum fourfold increase in sales. And a new initiative that developed concessions in garden centres has seen incredible results for franchisees (with one generating six-figure sales numbers within 10 weeks of opening!).

Key to the growth has been the extra training and support on offer. Sales training has seen even network veterans picking up several new tricks. A £150,000 investment in cloud-based accounting software, paid for entirely by the franchisor, has increased margins.

Driver Hire
Regularly appearing in both franchising and recruitment awards shortlists, and winning several, Driver Hire continues to go from strength to strength. Celebrating their hundredth UK office opening recently, they’ve been franchising for 25 years. But head office still update and innovate their offering and support to keep them in pole position when it comes to supplying transport and logistics staff.

With a business closely linked to the prosperity of the national economy, Driver Hire have once again tackled their challenges head-on to maintain their market position and continue to grow the network. The last year saw a major new initiative, ‘Winning With’, implemented to increase market share and create relationship-based selling opportunities.

‘Winning With’ offered new products, new ideas and encouraged new thinking within the network. It included a new HMRC-compliant employment model; a campaign educating clients about new Agency Worker Regulations, which others saw as detrimental but Driver Hire took the lead on, and reaped the rewards; at significant cost to the franchisor, an online fuel-efficient driving course, eFED, which makes driver training mobile and more user-friendly; and major monthly incentives for each franchisee to maximise their performance.

On top of this, and based on feedback from their conference, head office instigated a buddy system amongst franchisees. The network said they wanted to feel more like a connected entity, and head office responded by enabling and encouraging greater franchisee co-operation and best practice idea-swapping throughout different geographical regions.

Fresh ideas have yielded an increased performance for Driver Hire. Year-on-year turnover growth of over 15%, allied with record levels of new customer acquisition, show that listening to their franchisees and constantly looking for ways to improve the business are keeping the wheels very much in motion for this franchise.

Home Instead Senior Care
When husband and wife team Trevor and Sam Brocklebank brought this US brand into the UK market in 2005, they could have had no idea of the impact they would make. Just 8 years on, the company expects to hit the 150-outlet mark this year, had 500 attendees at its annual conference (franchisees and staff), has won a multitude of awards and generates around one-third of all Home Instead’s global turnover outside the USA. UK revenues grew by 45% in latest results, the sixth consecutive year of 40%+ growth!

But this is a business about so much more than simply making money. Offering 1-hour minimum visits to its homecare service users against an industry standard of 15 minutes, Home Instead achieved outstanding results in Care Quality Commission testing and has taken on an important and increasing role with major decision-makers on the future of care in the UK. The company won a slew of Great British Care Awards, including the prestigious National Dignity in Care award, amongst a myriad of other accolades received for its service levels.

CEO Trevor Brocklebank was voted one of the Top10 Most Influential People in Social Care and regularly travels to Westminster to work with politicians from all parties. The senior head office team have provided input into numerous government and Lords reviews and reports, and taken speaking slots at five industry conferences as well as the Liberal Democrat conference alongside the Minister for Care. The company’s position as experts in their field has been confirmed to the media with television appearances on BBC and ITN programmes.

This year Home Instead developed a new City & Guilds-approved qualification for dementia care...and then surrendered the intellectual property rights so that it could be used by the wider care community. It’s typical of their thinking.

Passion and integrity permeate the culture of the company from the top down. Franchisees are motivated and focused on their care quality levels and the support provided by head office means they are able to both deliver high-quality care and see outstanding results from their businesses.

Caring for their network as well as their clients is second-nature, and after two previous Silver awards in this category Home Instead will be hoping to go one step further in 2013 to add to their list of recent award wins.

ServiceMaster
ServiceMaster is a name that’s been on the franchising radar for a very long time. A bfa founder member, and using the model for around 55 years, confirms an impressive level of history – but it’s also one that requires careful navigation when undertaking a widespread modernisation programme.

Operating in a dwindling marketplace, as high excesses have reduced the number of home insurance claims for them to work with, innovation was essential to maintain a successful network. And conveying that innovation to a mature network was just as critical, to ensure their buy-in to the changes to a business that many franchisees have run for several years (14% of them for over 20 years).

A careful communications strategy, including national, regional and individual/small group meetings, proved extremely successful; so did a mantra of listening to feedback from the franchisees, essential to helping them be a part of the process.

The franchisor focused on three key areas: people, processes and technology. Extra head office support staff were taken on, including a number of specialists. Digital marketers offer in-house design, build and management of six website pages for each franchisee, a very high level of digital support and a key area of focus; the operations team was bolstered with a new head of restoration services; and commercial support centre staff, who provide 24/7/365 help for customers, received extra training.

The company now says it has more British Damage Management Association-accredited senior technicians in its network than its next four competitors combined. This is alongside extensive investment in fraudulent claims recognition training for franchisees, which is already saving their insurance partners large sums of money and helps give the franchisee a competitive edge.

With innovative training have come developments in the field. Truck-mounted technology has opened up new, previously inaccessible markets for franchisees, and while such vehicles come at a cost they have doubled the turnover of some of the network.

A final change came in the ServiceMaster invoicing system, with head office guaranteeing 30-day payment terms to their franchisees from a central invoicing centre for all work completed, regardless of how long the customer takes to pay their actual invoice. That level of cash-flow help cannot be overestimated for a small business owner.

Water Babies
Describing your business as ‘like a family’ is an oft-used phrase, but it exudes from every fibre of this children’s swimming lessons franchise. It has, remarkably, grown organically from within since starting its pilot franchise in 2003; every single one of its 52 franchisees are either a former employee or former customer!

It’s been that way since the beginning, when founder Paul Thompson and his wife started the company with a few thousand pounds in their hand and a dream in their minds (their very first teacher is now a successful franchisee in Norwich). This organic growth ensures that the culture and ethos of those founding days still remains at the core of the business and everything it does today. People are the all-important ingredient here, and looking after them is paramount.

To that end, franchisee support is extensive. There are working groups, called Pods, to harness the diverse talents of their network (which includes mothers, lawyers, doctors, all kinds of backgrounds) to help achieve more informed business decisions. The franchise structure is regionalised, to recognise the different socio-economic factors within each area and reflect them in each business’s objectives. And there’s a very high ratio of head office staff to franchisees, with each franchisee having a named contact responsible to them for the ‘core values’ of the brand.

There’s also been significant investment in technology. An online management system (the brilliantly-titled Nemo) helps franchisees manage the paperwork and planning side of things. When you recruit franchisees extensively based on their passion for your product, strong admin support is absolutely critical to ensuring franchisee success.

It’s precisely because they recruit people who are “passionate about swimming, not paperwork!” that Water Babies have introduced a finance unit to oversee all business matters from head office, centrally, for the entire network by the end of year. However, franchisees still have to know their own business inside out; there’s no easy ride here, and it takes 9 months rigorous training to get into the network. It’s a serious business, with serious turnover involved.

The collaborative effort that has seen the company achieve such success is set to go further with Water Babies currently considering international expansion in Europe and further afield as it looks to achieve its stated goal of being “the leading provider of world-class aquatic teaching programmes for babies and pre-school aged children”. That dream has brought them a long way in 10 years.