I’m sat in the departure lounge of Sevilla airport, and I started thinking about systems. Looking at the airport security and how you have to do things in certain ways, i.e., check boarding pass, then on to security remove all liquids and aerosols, iPads phones, then remove belts and shoes walk through the scanner. What if you went through security first and then checked the boarding pass and you were there the wrong day? Would that not be a waste of time, energy, and money. So for maximum productivity, they follow the process the way it’s designed.

Now as you are aware systems are a massive part of franchising. Franchisees require a system to follow to maximise their productivity which then maximises income within the business. This will help with two things that everybody wants, more time and more money.

Have you been into a McDonald’s recently?

I went into one a couple of weeks back and noticed that they had changed. You can now order food yourself on a giant iPad, where you pay, get allocated a number, and when your number gets called out and you receive your food. If McDonald’s can change their systems and processes for 49,000 stores worldwide, then so can you.

I’m sure that it won’t be long before you can order your food from an app on your phone. Argos have nailed this system down, we don’t all like it, we moan about it but we still use it why? Because it saves time which also saves money.

So think about your own systems, even if you’re not franchising, everybody has a system/process that they follow. How can you improve performance and maximise profitability? That one small change can really help you move your business onto the next level.

Our Online and workshop based programmes cover the importance of creating processes and systems by design not default and about testing, amending and retesting them until they work. If you want to learn more about how to become a better franchisor then get in touch today, call 01522 246812.

Michael Bohan

What we learn from cricket

You may have been entertained/distracted by yesterday’s cricket.  I was. The good news is that I am providing you with a completely valid business reason to keep watching.

Stuart Broad was superb and Joe Root’s inning (so far!) has been wonderful.  They both stood up and made individual contribution that have shaped the match so far.  But let’s not forget the rest of the team because their role has been just as important.

Have a look at the scorecard.  All of Broad’s wickets came from catches at the slip.  The fielders held every one (including Stoke’s remarkable catch) and knew exactly what they were doing.  They gave Broad the confidence to do what he does best.  Everyone in that team played a part.

Let’s go through the first innings. Broad.  It’s pretty obvious what he did.  With that sublime spell of bowling he made the batsmen do what he wanted.  Cook let him.  He was there to provide support and advice when needed but didn’t interfere unnecessarily.  Bairstow stopped byes. The slips provided pressure on the batsman and caught.  The outfield fielders swept up stray balls.  The bowlers worked together to keep the batsmen off balance.

They England team had a plan and they executed it.  Everyone knew their part and played it well.  They had flexibility to change things around if they needed to and they all supported each other.  And Australia were all out for 60.

Now let’s compare England’s first innings.  Australian slips missed catches and let balls go through.  The bowlers didn’t work together to unnerve the batsmen.  Easy balls were dropped.  They stuck rigidly to their plans even when they didn’t work.  And because they had panicked about one part, their batting, they had unbalanced the side and lost a bowler so they were all having to work harder and longer than they should.  By the end of that first day England’s score was four times Australia’s first innings.

OK, bear with me, we’re getting to the business bit.  Look at each team as a small company.  One had a leader who was prepared to let his players work in a way that suited them and provide support when asked.  One had a field of players who all knew their own role inside out and performed it to the best of their ability. One team celebrated each other’s success.

And one team didn’t.

Work out who you are in those two teams and work out who you want to be.  If you can work like England played you’ll skittle your opponents too.

Enjoy the rest of the match.

Harriet

In my opinion, this is one of the most important things to think about when you are franchising your business.  Why? In both of my businesses I deal with people on both sides of the equation. When you are a brand new franchisor, then your first few franchisees are going to be entrepreneurial, they are going to want to get involved in a business that is brand new and exciting.  When you have got a few more franchisees then you are going to be attracting the “sheep” or followers, these people have seen you grow and wanted to see if it worked before they hand over their savings to you.  Then you have the “rest”, this is where you will be pitched in the same area as everyone else who is selling a business that has been running for a few years, has good franchisees and a growth plan to go forward.  The main thing here though is at all of these stages you need to have a profile of franchisee that you are looking for.  For example, they might need to have a certain skill set or you might only want people to work full time in the business.

I would advise people that full time franchisees are harder to find than people who want a franchise as a 2nd business.  But it’s the best way to go if you want them to build a business quickly.  I have had a few disagreements with people over this, put it this way – if you take on a franchisee and they have a part time job or another business, where is their main focus? I will promise you, if they struggle with the business for whatever reason, where do you think they are going to put more of their attention? Where the money is! That means that you have sold a franchise to someone who doesn’t actually want to work on the business because their focus is on their PT job.  This totally comes down to your franchisee profiling.  There are a few main reasons why a franchise doesn’t work; the franchisee doesn’t follow the system properly and thinks they know best, (why did they buy it?!), the franchisor sold a business that didn’t work, or the franchisee runs out of money.

On the other side of this you could take on someone on who has too much money, but how can you have too much money? The biggest problem with too much money is sometimes they don’t have the motivation as they don’t actually need it.  My daughter is 10 and trying to get her to understand about motivation is killing me: she is taking her 11+ this year and we want her to get into a grammar school for a good education. When I say if you don’t study you won’t get in, her question is “so where will I go?” I then explain a 2nd option is still a good school but not 1st choice, do you know, her answer is, “oh well, it’s still a good school” – she’s happy to settle for 2nd best. Now, she’s 10 so hopefully she will learn about competition and that in the future, but do you really want a franchisee who is subconsciously OK if they fail?

Franchisee profiling is key to how your business will shape in the future, you want the correct people from day one, yes it’s going to take longer but they are going to be worth it.  Having a high churn rate on franchisees is a massive ‘no no’ to incoming franchisees, why would they buy into a business that has people leaving here, there and everywhere?

Now this is different to a well-run franchise having franchisees who have had their franchise a while and are looking to sell. At any time a mature franchise will have about 10% of the franchisees up for resale, this is normally because they have done their time and want to retire after making their money.  When you are profiling a franchisee for a resale it is different to a new start.  This is when you are going to look for people who have got the money as the purchase price is going to be higher but their return on investment is hopefully going to be quicker, which means their focus is there and they have a plan in place to grow the franchise.  Is there any point in taking on a franchisee for a resale and them not growing the business?  Yes of course, the outgoing franchisee may not have had the focus for a while as they are selling but still we all want to grow don’t we?

 

This weekend spend half an hour thinking about who you want to be your franchisees and who you want to avoid.  Work out why and you’ll be on the first step of making your franchise work.

Travelling back on the train from London yesterday I started thinking about how long franchising has been around – a long time now – and how the industry continues to grow and develop.

This I think is partly because in business today we want everything now and don’t want to wait for it!

I speak to lots of business owners who are thinking of franchising, and a lot of them want to do it as cheap as possible and they want 20 franchisees in their first year. Why? Let’s be honest here, to franchise your business in the UK all you need is a business model, a franchise agreement and franchisees. That enables you to run a franchise. So does that mean that to be a dentist all you need is dental equipment and a chair; to be a carer you need to care for people; to be a taxi driver you just need to be able to drive and answer questions from punters; to be a football coach you need to watch football and tell players what to do. Am I right? NO course I’m not, you need qualifications for all of these things to be able to do your job properly.

Why? What does the qualification mean? It means you are qualified to be in those jobs. It means that you have taken the time to understand the industry and how it works and what your customer needs are and that you are able to satisfy those needs.

How then is franchising any different? you are changing your business into a coaching, training and recruitment business. How many franchisors out there have actually learnt how to be a franchisor? Yet time and again franchisees are happy to hand over their savings and trust someone who has not been qualified to train, coach or support them.

We are working on a programme that we thought helped businesses owners to franchise their business, but actually because of the leadership and management information in it and the industry knowledge that we impart the programme is really about becoming a franchisor.

So what I am getting at here is why I believe that Gti Consultancy is so different, it’s because we don’t franchise your business, we teach you to be a franchisor and help you to build your business.

The old saying goes “fish for a man and he can eat for a day, teach a man to fish and he can eat for the rest of his life” it’s exactly the same in franchising if we were like all the other consultants out there and did it for you. What would you actually learn? If we taught you how to be a franchisor and manage your franchisees, understand some of the pitfalls you might encounter you can franchise your business without making some of the mistakes that other franchisors have made – now isn’t that what franchising is all about?

I’d be really interested in your thoughts.

Michael

Does what you wear make you less of an expert??

Image source: Flickr.com

Image source: Flickr.com

I have noticed that more and more people in business are becoming casual in their appearance, why is that? Especially men; go back 10 years and every man in business wore a suit and tie, now it’s ok to wear a suit and no tie or even jeans.  I’m not saying it’s right or wrong, my question is more about if someone who is a “professional” wore jeans to a meeting with you, would you take them less seriously because of what they were wearing? Don’t get me wrong, first impressions are important and we all say don’t judge a book by its cover. But should what we wear really influence others?

If you were to go into a meeting with a franchisor how would you expect them to look? Does it depend on the business sector? We assume that sales people will be very smart to give a great first impression, if they came into the meeting in shorts and a shirt how would you feel? Maybe that this meeting is not as important to them as it is to you. But why? Surely what we wear shows that we are comfortable in ourselves. But the way that business is perceived is so often in suits.

Just because you don’t wear a suit doesn’t mean you don’t know your stuff!

On the other side of this though, as a franchisor would you let your franchisees wear what they like? It’s something you need to think about in your brand guidelines. Some might say it doesn’t matter what people wear so long as they look smart. But what is smart? Smart to me is probably different from smart to someone else.  It’s like the smart casual note on the bottom of an invite.  What is smart casual? I assume that means jeans and a shirt but does it? It’s like the joke picture of the naked man with a tie on saying, “It said smart casual”. If smart to you means jeans and a shirt should you write “dress code jeans and an embroidered shirt” This has slowly turned into a communication blog but how we dress and how we are perceived by others is a form of communication after all.

Anyway its hot outside and I have my shorts on

Written by Michael Bohan

Who is your competition?

It is very easy to look around and say “My business is unique. I don’t have any competition” While the first part is true (no one else has you) the second is definitely false.  It’s also very dangerous; there is no business without competition.

A simple example is buying a new BMW.  Now the obvious competition is Audi and Mercedes.  You might go a bit higher on price, with Jaguar and Rolls Royce, or a bit lower with Vauxhall or Skoda.  You might go so far as to think of motorbikes or second-hand cars being an option. And there, 99% of people will stop.

The trouble is that people’s minds won’t stop there.  They have a finite amount of money so may think, “I’ll keep the current car and have a holiday instead.  I’ll buy a conservatory. I’ll pay for private school for the grandkids.” It will be very rare that someone is so precise in what they want that there are no other options available.   Anything can be your competition which is why you must use positivity in your messages.  Instead of saying “xxx is rubbish” which only rules out one competitor say “I am the best”.

Try to fix the problem the customer has.  With a BMW the problem is that the customer wants to feel special while at the same time having reliability at a reasonable price. So to solve that you have the fact that the car is a luxury. That rules out the lower end cars. It’s affordable. That rules out the higher end too. It’s safe so no motorbikes and reliable so not second-hand.

The next part is harder.  How do you compete against a holiday?  Well the fact that that the car will make you feel special for years while a holiday will be over in two weeks. The conservatory? You spend more time in a car than sitting in the house. And the grandkids? Forget it – you can’t compete!

This is a very basic example but you can apply it to your business.  Find out what your customer is looking for and tailor it.  You might want to split them into different groups, who all have different needs.  And because they have different needs there will be different competition.

The more heads involved in this the better.  Bring in friends, family and neighbours. Ask your staff and brainstorm.  Do the hypothetical “if you had £xxx what would you spend it on?” This is one area is where being part of a franchise can really help.  There will be others thinking of the same question.  You can even ask if it can be a ten minute discussion during a get together with other franchisee.  You can help each other and improve your business at the same time.

The more competition you can think of, the more angles there are to market to and the more opportunities to sell.  Pretty soon you’ll be the one selling conservatories to car buyers!

Written by Harriet Ennis

Running the shopChannel 4 logo

Have you watched Running the Shop on Channel 4?  The programme description is “Hilary Devey persuades bosses to leave their business for three weeks and let the staff run the shop while they are away”.  They also get money to fund any changes they want to make.

The first episode (which is well worth a watch on All 4) is based in a furniture and hardware store with an owner, John Tasker, who likes to micromanage.  The staff feel that the furniture on sale is too big and expensive for most of the houses in the area and so do a special offer with a “complete living room” for £500.  They have some very novel ideas for advertising it. Marketing is the other big issue the staff noticed and one of their ideas is to do product placements is show homes.  I won’t spoil it for you be saying how they got on but there are some very interesting moments!

Whether or not a boss is willing to give up control of their business without the TV cameras present, the show did provide some useful ideas.  What was highlighted was the potential that can remain hidden if no one is willing to listen.  People who are doing the job will be aware of what the problems are, difficulties they’ve found themselves or that have been fed back to them from customers.  Not just problems, they will see opportunities too.  Going back to the shop floor for a moment, till operators may see two things often being brought together.  They should be able to feed that back up so that those items, and other complimentary ones, can be displayed together to inspire other purchasers.

A manager has to listen to what their staff are saying but that alone is not enough.  They have to be willing to implement ideas too.  I don’t mean everything (some ideas really are crazy) but they need to be willing to try new things. Yes, it is a risk but keeping everything the same while the world changes is a far bigger one.

As Hilary pointed out in the show, John the owner had 30 years of experience in the business. Combined, his staff had over 500. Train your staff up so that they are to run their area independently, reporting back and asking for help as needed but ultimately allowing you to work on your business rather than in it.  The owner in the show was so busy looking at the fine details that he never had time to step back and look at the big picture; to see what the opposition were doing, what new opportunities were available and what was now just out of date.

The owner of this store was a barrier to expansion as he was so determined to oversee everything.  It’s understandable, the store is his life and it’s hard to let go.  If John wanted to expand at present he wouldn’t be able to without splitting himself in two.  One way that he could do it without that problem would be to franchise his business.  The new store would have it’s a different owner who would be just as passionate about making things perfect, getting guidance from John and having his systems in place to make sure everything runs smoothly. John would then be running two businesses – his original store and being a franchisor. If he tried to do it all he would struggle and neither business would benefit. The same rule applies: you need to work on your business rather than in it.

So the lesson is; make use of the skills of your staff, step back and look around, try new things and see your business evolve in ways you never could have imagined.

http://www.channel4.com/programmes/running-the-shop

Written by Harriet Ennis

Do you know you’re gross and net? How about you P&L, CPS, PE Ratio, RPI, RRP or VAT? Do you have stock on the LSE, NYSE or NIKKEI? Do you do deals in pound sterling, American dollars, Hong Kong dollars or Bitcoin? Do you know what any of this means and do you need to?*

Starting a business can be like going from the swimming pool to crossing the channel.  It’s hard.  The learning curve is incredibly steep and no matter how well prepared you think you are there will be something that comes around unexpectedly.  It can be the seemingly little things that trip you up; if you use a cloud based system what happens when the internet goes down?  Or it can be the huge things; you know that you have a great product so why doesn’t the buying public agree?  There are a thousand and one questions that will come up, you often realise that you don’t know the answer only when someone ask the question.

Mentoring by an experienced business person can be a great way to help you along your path.  They will be able to answer a lot of your questions and sometimes talking through a problem can be the means of seeing the answer.  The problem is that they are not really invested in your business and they won’t know the problems you have as well as you do.

An option people are increasingly turning to is to buy a franchise, either a new start or a resale.  With a franchise you will start by being trained in the franchisor’s systems, systems that have been tested, retested and developed until the franchisor is sure they work.  You will have the support you need on the end of a phone by someone who knows the challenges that are unique to this business model and has a vested interest in your success.  You will have a national name and the benefit of their advertising.  It’s your business but it comes with a support package and a helping hand.

If you buy a resale you will be charged the cost of the business as well as the fees from the franchisor but the initial legwork will already have been done.  You will be able to provide accounts to a bank which will help if you need financing with a resale and you will have an income from day one.

If you buy a new start you will be given a territory by the franchisor and with their help you will develop the area.  There will be a lot of work to start with but you will benefit from the national name and the upfront costs are lower than with a resale.

Before you buy either type of franchise you will need to meet with and be approved by the franchisor.  They will make sure you are the right person for their business.  You are not an employee but you will become the local face of a brand they have spent years building up.  They will want to make sure that you will be a good fit and that you have the best chance of success possible.

Whatever you decide to do there will be a lot of challenges ahead.  Business is a lonely place but you can make it easier on yourself by being well prepared, having in place the help you need and by going out and networking with other small businesses who will be just as terrified as you. Good luck!

 

*The answer is you need to know some of it. Gross and nett are how profit is presented before and after tax deductions.  P&L is Profit and Loss, CPS is cost per sale (how much you have to spend to make each sale), PE Ratio is price to earnings ratio, RPI is retail price index, RRP is recommended retail price and VAT is value added tax. LSE is the London Stock Exchange, NYSE is the New York Stock Exchange or NIKKEI is the Japanese stock Exchange. You’re unlikely to need this. Yet.

Written by Harriet Ennis

We have been lucky enough to have James Sewell from Wright Vigar’s expert views on how the budget is likely to effect you.

 

Listening to the radio on the way into the office this morning, I was a little bit surprised to hear that tax returns were potentially going to be abolished.  Once I’d clarified the Arsenal result with our Arsenal supporting tax advisers… I tuned into the speculation the team were discussing about digital filing of tax data.  The Chancellor’s speech did little to clear up the mystery. However, the lunch-time reporting gave a more accurate picture, announcing that end of year paper returns would be scrapped in favour of real-time online accounts by 2020.  Whilst the average employee with a small amount of savings may have known that HMRC already held all the necessary information to work out their tax bill, the idea of having a personal account with HMRC will not necessarily be attractive to all. By 2020 we are told, the accounting software of a business will be able to feed data straight to their digital account with HMRC, and both individuals and businesses will have the option to ‘pay as you go’.

There was some concern as the budget approached that the Chancellor might raise capital gains tax rates for individuals or chip away at the Entrepreneur’s Relief (ER) which reduces chargeable Gains Tax on a disposal of business assets to 10% from the standard 18% or 28%.  However, other than the closure of a couple of loopholes, the relief remains intact.  Following the Autumn statement when it was announced that ER would not be available for gains on goodwill when a business incorporated, there was concern that this would adversely affect individuals who were retiring at the time of incorporation. The rules have now been clarified to confirm that partners who do not acquire a stake in the successor company can still benefit from ER on the disposal of their share in the business.

The Chancellor announced a new personal savings allowance which will be introduced from 6/4/16. For a basic rate tax payer, this will mean that they can receive up to £1,000 interest income and pay no tax on it.  For higher rate tax payers the allowance will be £500 and there will be no allowance for additional rate payers.  On top of this, greater flexibility was announced in respect of ISAs, allowing savers to withdraw funds and repay them within the year without affecting their annual subscription limit.  This is planned for introduction in Autumn this year.

To help first time buyers, there will be a new Help to Buy ISA.  This can be opened with an initial deposit of up to £1,000 and then you can save up to £200 a month.  When you buy your first home in the UK, HMRC will add a bonus of 25% to your savings up to a maximum bonus of £3,000.

When the new pension freedom was announced in last year’s budget, the Chancellor made it clear that people who had already purchased an annuity had effectively missed the boat. However in today’s budget, legislation is promised from April 2016 which will allow people who are already receiving income from an annuity to assign that income to a third party in return for a lump sum.  Whilst this will extend pension flexibility to a wider group of people, it will not undo the ‘damage’ suffered by a pensioner who was obliged to buy a product when the annuity rates were low. The low level of income they are assigning is unlikely to bring them a large lump sum and as always there will be significant fees to pay and possible tax implications.

And finally…..there’s a penny off every pint!!

 

I would be pleased to speak to anyone to clarify how this budget will affect them and also to confirm if their affairs are organised as efficiently as possible!  Please don’t hesitate to contact me on 01522 531341 or james.sewell@wrightvigar.co.uk

Listening to a conversation between a group of professional people last week, I was amazed to hear one of them say “being late is okay because it shows that you are busy”….. I was astonished to say the least. In my opinion that idea is so old fashioned and wrong, but non the less true sometimes.

Why do I say that, it’s bad manners to be late – right? Everyone has the same amount of time 24 hours in a day: no more, no less, but it’s amazing how some people manage to do so much more with the time that they have.

Using time effectively is a sign, in my opinion, of professional efficient use of a resource that we often take for granted. If we try to cram too much into our day because we don’t plan time properly that might make us late. That’s not good, it really is bad manners. It says to your client, friend etc. That you and your time are more important than them.. Ouch!

Underestimating how long it takes to carry out a task can be frustrating but it happens to all of us from time to time. The trick is to build into your day planning time so that you can decide what to do when, allowing you to complete what is possible in the time available.

Perhaps I should invite the people I was listening to, to one of our time management workshops but that would mean I was making the assumption that his group of colleagues/associates agreed with him and that’s a whole new subject for another day. Until then plan effectively and use your time efficiently, remember we all have just 24 hours in a day so use it wisely……

Regards

Julie