So how does procrastination affect a business?

Can procrastinating be a good thing?

What does it actually mean?

The dictionary states that it is a deferring of action. Delaying something needlessly.

If those definitions were applied to business growth few business owners would consider procrastination to benefit their business nor be a good thing.

There is a huge difference between research, fact finding, due diligence versus procrastination. The fore mentioned words are essential in any business planning or decision making, whereas;

procrastination is purely an avoidance of action.

So let’s consider the opposite to procrastination. Well, there doesn’t seem to be one word that fits the bill.

I have looked at websites that suggest the following opposites;

• Action taker
• Decisive
• Pro-active
• Go –getter

These words resonate with me much more.

These are the sorts of business owners that I love to work with.

When dealing with a crucial business decision they undertake their fact finding, research and due diligence.  In the case of deciding whether franchising is suitable for their business they undertake a franchising feasibility study with franchisingplus which provides financial information and an objective report on the reality of franchising.

Once armed with all the facts and information they need to make a decision, they proceed to franchising their business almost immediately OR they recognise that the business is not ready for franchising and follow the recommendations in the feasibility report.

Either way, these business owners have not procrastinated about undertaking a franchise feasibility study, they have taken action in their business which will allow them to grow profitably and effectively.

Meanwhile the procrastinators sit and watch the grass grow……………….

© franchisingplus

Author ; Carolyn Dufton Dip.Bus(franchising)

Carolyn is the principal of franchisingplus. franchisingplus is a franchising consultancy advising and mentoring on all aspects of franchising on a national and international basis.

The content displayed is franchisingplus copyright and can only be reproduced or re-published with the acknowledgement of the author Carolyn Dufton. www.franchisingplus.com.au/contact/

The question is, do Franchisors really have a choice as to whether or not they should grow their franchise network ?

Let us consider;

• How will a potential Franchisee view your network if you have not sold any new franchises in the last year?

This could be seen as being a more high risk venture for them. It could suggest that you are not serious about your role as a Franchisor looking to grow the business for the benefit of all.

• How do existing franchisees perceive a stagnation in growth and expansion? Could they feel more vulnerable and feel that the Franchisor is losing sight of the big picture?
• Ask yourself, why aren’t you selling more franchises?

Is it a deliberate strategy? Are you consolidating? If so, let your franchisees know that this non expansion is only temporary and keep them informed of your franchise growth plans so they’re not left guessing.

• Is there a ”right” number for annual expansion plans?

Although there is no right number, the best expansion policy is gradual and consistent so as not to overwhelm the Franchisor and burdon the infrastructure. The larger the system and managment infrastructure the greater the capacity there is for expansion.

• Franchisors need “new blood” in their system. It’s good for the business. BUT it is vital that Franchisors do not compromise in their new franchisee recruitment process.

Franchisees must meet the necessary criteria to ensure a continuing high standard of franchise and alignment to the current system and people.

Professional advice should be sought to assist with the growth strategy.

 © franchisingplus

Author ; Carolyn Dufton Dip.Bus(franchising)

Carolyn is the principal of franchisingplus. franchisingplus is a franchising consultancy advising and mentoring on all aspects of franchising on a national and international basis.

The content displayed is franchisingplus copyright and can only be reproduced or re-published with the acknowledgement of the author Carolyn Dufton. www.franchisingplus.com.au/contact/

Under section 6 of the Code, franchisors must update their whole Disclosure Document within 4 months of the end of the financial year, which for most franchise systems is 31 October 2011.

Key points to remember are:

Any franchisee entering into an agreement after 31 October 2011, whether it be as a result of the grant of a new franchise, a resale, a renewal or just as a result of parties entering into an agreement that varies a prior franchise agreement; must have been given the current franchise documentation i.e. updated to at least 1 July 2011, at least 14 days prior to the signing of such documents.

Existing franchisees have the right to request, once every 12 months, that a current Disclosure Document be provided to them. This demand must be met within 14 days of their demand.

The ACCC can as part of their audit powers require a copy of the past and current Disclosure Document and related franchise materials at any time, and franchisors must generally comply within 21 days.

Disclosure Document review

It is recommended that the whole disclosure document should be reviewed with relevant sections updated as required, but pay particular attention to:

• updated your current list of franchisees and any franchisee that has been transferred, terminated or ceased to operate in the last 3 years. 
• Any changes to franchise recruitment and suppliers arrangements;
• finalised and updated disclosure regarding the Marketing Fund’s expenses for the last financial year;
• updated disclosure regarding any unilateral variations to your franchise agreement in the last year (new requirement from the Code 2010 amendments which now has to be completed);
• updated disclosure regarding whether you have taken into consideration any significant capital expenditure by franchisees when determining renewal or expiry arrangements in the last year; (new requirement from the Code 2010 amendments which now has to be completed);
• updated all Item 13 costs, including recurring or isolated franchisor and third party expenses within the knowledge of the franchisor or reasonably foreseeable by the franchisor. Thus, this includes payments made to the Franchisor or any other third party when initially entering into and during the term of the Franchise
• ensured that Franchisor’s end of Term arrangements are clearly defined.

 Financial information:

• Financial reports for the Franchisor for the last two financial years should be readily available
• OR a copy of an independent audit by a registered company auditor, confirming that as at end of last financial year, i.e. 30 June 2011, the Franchisor company will be able to meet its debts when due.  

 Marketing Fund update:

Prepare an annual financial statement for the marketing fund, and have the financial statement audited by a registered company auditor within 4 months of the end of the financial year.

 © franchisingplus

Author ; Carolyn Dufton Dip.Bus(franchising)

Carolyn is the principal of franchisingplus. franchisingplus is a franchising consultancy advising and mentoring on all aspects of franchising on a national and international basis.

The content displayed is franchisingplus copyright and can only be reproduced or re-published with the acknowledgement of the author Carolyn Dufton. www.franchisingplus.com.au/contact/

Recently I had a very unsatisfactory customer service experience with a local franchised business. The manager wasn’t on the premises so I asked the young assistant to ask the manager to call me. He didn’t, so I rang the shop to be told that the manager was too busy to talk to me about their customer service.

I decided to see if The Franchisor was more customer service focused and aware, by posting on both Facebook and Twitter. It went something like this “Had a truly awful experience at ‘company name’s’ local store today, and the manager doesn’t care”. I waited to see whether the company would pick up the comment. They didn’t.

So to give them a second chance – I posted again. I had lots of comments from other people who saw the post but none from the company.

Google alert is a tool that allows businesses or individuals to monitor for free, what is being said about their company in the online world. It is a free service.

You can’t stop people talking about you online, but being aware of what they’re saying allows you the opportunity to respond quickly to diffuse a situation.

You do not have to be engaged in social media to use this tool. Google will send you an email of whatever message they find online. Twitter will also pick up any “mention” of you if you subscribe – again for free.

In my opinion all businesses and Franchisors in particular, need to be informed about what is being said about their businesses online, and Google Alert provides an easy and free method of achieving this.

Go to www.google.com/alerts to set up your alert today. No excuses now!

 © franchisingplus

Author ; Carolyn Dufton Dip.Bus(franchising)

Carolyn is the principal of franchisingplus. franchisingplus is a franchising consultancy advising and mentoring on all aspects of franchising on a national and international basis.

The content displayed is franchisingplus copyright and can only be reproduced or re-published with the acknowledgement of the author Carolyn Dufton. www.franchisingplus.com.au/contact/

To watch the video use the link below.

http://www.businessinsider.net.au/up-close/carolyn-dufton

In this short video, Business Insider interviews Carolyn Dufton about her franchising career, how she got started as a Franchisor and where she is today as a franchising consultant.

Listen to Carolyn speaking with Scott Levi on 92.5 ABC Central Coast.

Visit ABC radio website

Learn more about The F World Book

Why I wrote The F World book

The book has been “in me” for a long long time. Every client I met and every franchising story I heard provided material for the The F World book.

I had reached a point where I was bursting with stories and information to share, and knew that writing a book was the outlet I needed. I had already completed a 3 part CD series for clients (Discover Your Franchising Potential) considering franchising, and this has been really well received.

This time, I wanted to write a book for everyone.

The F World book is a generic franchising commentary and will appeal to anyone wanting to know more about franchising. The book is not a hard sell for franchising. It is a ‘warts and all’ objective commentary on the franchising world and its common practices. As I say in the book, not everyone is suited to franchising.

As a franchising consultant /coach, I work with Franchisees and Franchisors alike, so I have no bias to any particular sector of the franchising industry. Some of the things I see in franchising I love, whilst other situations I encounter I detest.

Much coverage of franchising is biased. The media can sensationalise a “hard done franchisee story’ and a franchisor can spend a large sum of money to obtain great editorial about the wonders of his franchise.

I wanted to write a book that told the truth about franchising.

The F World book has been written in plain everyday language for those looking to learn more about the reality of small business franchising. In particular it will provide insight for potential and existing Franchisees or Franchisors in small to medium franchise networks.

Franchisees and franchisors are asked to review their franchising performance and the book then gives examples of how to be ‘the best’.

I sincerely hope that readers will learn from the experiences and mistakes of others as described in this book, particularly in the ‘scary’ chapter.

You can buy a copy of The F World book here: http://franchisingplus.com.au/fworld/

Or for US and UK residents visit: www.amazon.com

© franchisingplus

Author ; Carolyn Dufton Dip.Bus(franchising)

Carolyn is the principal of franchisingplus. franchisingplus is a franchising consultancy advising and mentoring on all aspects of franchising on a national and international basis.

The content displayed is franchisingplus copyright and can only be reproduced or re-published with the acknowledgement of the author Carolyn Dufton. www.franchisingplus.com.au/contact/

All my friends and business associates know my interest in “all things franchising” and often share their experiences with me. One of my business friends told me an astonishing tale which as a Franchisor you really need to hear and heed.

A large franchise, offering a consumer service, that advertises on an ongoing basis on TV, radio and in magazines is the subject of this story.

Let’s call the customer Mary. Mary had rung the local Franchisee on 3 occasions to arrange a quotation for, let’s call the service cleaning. Mary was keen to get the cleaning organised  a.s.a.p. and was really disappointed that she was greeted with a voicemail message on those 3 occasions she called. She left a clear message with a return phone number and asked the Franchisee to call her back urgently.

After a week of no returned call, Mary in sheer exasperation called in to the shop front. The Franchisee Jack was busy shuffling mountains of paperwork and muttering to himself, meanwhile ignoring Mary completely.

Mary, now losing patience with this complete lack of customer service introduced herself to Jack and asked why her 3 calls had not been returned.
“Listen lady, if you had as many people ringing as I do, you’d have to turn your phone off too. I’d never get anything done. Listen to this …….” Jack put his mobile on loudspeaker “you have 62 new messages.” “THAT’s why I didn’t return your calls” Jack shouted. The b…… Franchisor keeps spending all our marketing levy on b……. TV advertising and the phone never stops. I’m having a breakdown. How they think I can cope with all this business I don’t know, but they just don’t listen. Anyway now you’re here, what do you want?”

Needless to say Mary walked out at this point and has shared her tale and complaint with many.

Is your jaw on your chest? Yes of course. It’s an unbelievable but true story.

But could this happen in your franchise? What checks and measures do you have in place to ensure it’s not your business losing its reputation?

Here are some strategies that can assist you.

• Is there a defined level of sales where you advise Franchisees that they will need to employ an extra staff member?
• Are your franchisees capable of running a business? or have they just bought themselves a job?
• Engaging mystery shoppers on a regular basis with the Franchisee’s knowledge ensures that the Franchisees know any major misdemeanor would be identified.
• Are your Franchisees trained and confident in handling busy periods such as pre Christmas trading?
• Do you communicate regularly with your Franchisees regarding national advertising campaigns?
• Are you and the Franchisees testing and measuring the results of your advertising? This is crucial.
• An overload of business spasmodically is not good business practice and is extremely difficult to service. If you know what advertising makes the phone ring, share this knowledge with the franchisees and help them be prepared for the extra business.
• Guidelines and directives regarding new business enquiries are imperative. Every operations manual should detail customer service standards.
• Has your franchise system addressed whether a Franchisee has the choice to turn new business away? This is a very important consideration in any franchise and The Franchisor should ensure that the Franchisees clearly understand their obligations.

It is most businesses’ dream to run an advertising campaign that results in the phone running hot. Before you invest in such a campaign ensure you have the service systems in place to stop the dream turning into a nightmare.

© franchisingplus

Author ; Carolyn Dufton Dip.Bus(franchising)

Carolyn is the principal of franchisingplus. franchisingplus is a franchising consultancy advising and mentoring on all aspects of franchising on a national and international basis.

The content displayed is franchisingplus copyright and can only be reproduced or re-published with the acknowledgement of the author Carolyn Dufton. www.franchisingplus.com.au/contact/

Terminating a franchise mid- agreement is a process that should not be undertaken lightly.

The disclosure document states that all terminated franchisees should be listed for the three previous financial years.

No reason for termination needs to be provided in the disclosure document, but terminations do not present well to franchise prospects.

Franchise network morale needs to be considered. Is the franchisee to be terminated known by other franchisees to be unco-operative and a negative influence? or is the franchisee generally popular with franchisees but challenging and non compliant with the Franchisor? Tread carefully here.

So why would you consider terminating?

• The franchisee is not performing.

This can be a tricky one. “Not performing” can be subjective. Do you have a clause in your franchise agreement specifically addressing non or under performance? If you don’t, it would be unadviseable to pursue this line of termination.

• The franchisee is not paying royalties.

This is a much easier situation to prove. Even the worst franchise agreements I see (and there are some shockers out there…) contain a clause relating to termination in the case of non payment of monies due to The Franchisor.

The question should be why aren’t they paying their royalties?

•  The franchisee is in breach of the system and procedures and is non compliant.

Franchisors have varying approaches to non compliance. Some look the other way and allow non compliance to continue as “it’s all too hard”. Non compliance can be extremely damaging to a franchise system and impact upon other franchisees. Check the Franchisor obligations in your franchise agreement to remind yourself what your obligations are in respect to protecting the brand and the other franchisees’ reputation by association.

Mediation can work well to resolve disputes and should not be overlooked. Either the Franchisor or the Franchisee can request mediation and the Franchising Code states that the other must agree to attend and share the costs equally.In Australia the Office of the Mediation Adviser can assist Franchisors on 1800 150 667.

Termination should always be a last resort.

So how do I terminate the franchisee? 

Check your franchise agreement for the specific clauses relating to termination and follow the process point by point. The franchising code of conduct states that in the case of a breach of agreement by the franchisee;

The franchisor must give reasonable notice of the breach to the franchisee

Tell the franchisee what needs to be done to fix the breach

Allow a reasonable time for the breach to be fixed (not more than 30 days)

If the breach is fixed then the Franchisor has no grounds to terminate on this basis.

If the Franchisor wishes to terminate the agreement on other grounds, reasonable written notice must be provided with the reasons for the proposed termination.

The franchisor does not have to comply with these termination conditions if the franchisee:

• no longer hold a licence needed to carry on your business
• become bankrupt or insolvent
• abandon the franchise
• are convicted of a serious offence
• operate the business so that it endangers public health or safety
• agree to terminate the franchise agreement

The franchise agreement must be clear on this termination process. If you feel your agreement does not contain a comprehensive termination clause contact a lawyer who understands franchising or franchisingplus for assistance with upgrading the agreement.

© franchisingplus

Author ; Carolyn Dufton Dip.Bus(franchising)

Carolyn is the principal of franchisingplus. franchisingplus is a franchising consultancy advising and mentoring on all aspects of franchising on a national and international basis.

The content displayed is franchisingplus copyright and can only be reproduced or re-published with the acknowledgement of the author Carolyn Dufton. www.franchisingplus.com.au/contact/

A Blame Game

The chances are that you’re reading this article with a preconception about Franchising.

The very word Franchising can inflict pain upon failed ex-franchisees who are still harbouring grudges against a Franchisor…. and for some Franchisors, blaming franchisees for the network’s failure is standard conduct. Whilst for some entrepreneurs, franchising conjures up a cash cow concept. Franchising is the goose that will lay golden eggs.

The truth is, that for franchising to work effectively, each party, that is The Franchisee and The Franchisor must firstly understand and secondly follow through with their obligations.

Best franchise practice provides a transparent and clearly documented system. Obligations are stated in the franchise agreement and are legally binding.

In my experience many “injured” ex franchisees were, to varying degrees, responsible for their own demise despite the fact that Franchisors are often blamed for their failure.

 As for Franchisors who consider franchising to be a cash cow, I would suggest that a responsible Franchisor would be investing substantial time, money and effort into growing and supporting their Franchisees. There’s no such thing as a free ride.

For all parties involved in franchising there are some common rules for success.

• Seek professional advice – gain clarity

Most of the Franchisees I see with problems in their franchise did not have specialist pre purchase franchise advice at the outset.

 Franchisors should develop a system and legal documentation with specialist assistance.

• Understand the nature of franchising

Research the franchise industry extensively before getting involved as a Franchisee or Franchisor. Make informed decisions.

• There must be acknowledgement that a Franchisee is a self employed person who is responsible for their own business success.
• Address potential issues in the franchise pro-actively using honest communication and dialogue before they become unmanageable.

Mediation is an attractive and cost effective practice to resolve Franchisor – Franchisee differences. The franchising code of conduct states that if one party requests mediation the other party must agree and that mediation costs are shared.

When blaming is replaced by acknowledged responsibility, Franchising really can provide a win –win situation for both Franchisor and Franchisee.

© franchisingplus

Author ; Carolyn Dufton Dip.Bus(franchising)

Carolyn is the principal of franchisingplus. franchisingplus is a franchising consultancy advising and mentoring on all aspects of franchising on a national and international basis.

The content displayed is franchisingplus copyright and can only be reproduced or re-published with the acknowledgement of the author Carolyn Dufton. www.franchisingplus.com.au/contact/