Getting into top franchises costs millions, but there are excellent opportunities further down the affordability ladder, says Grant Wheatley, whose company Baobab owns 13 KFC restaurants in the Eastern Cape, and is moving the brand into southern Africa.
Wheatley says good franchises are a ticket to business success, providing the franchisees stick to the blueprint.
However, the entry tickets to big money are expensive.
“In my businesses, I like to work with service providers that are part of reliable franchises. I know that their systems work, and they have sound backing.
“If I could advise any future franchisee with a limited budget, and I am not stifling dreams and ambition, it would be to explore the more affordable options.”
Jason Bowen opened Talisman Hire in East London four years ago. He had no experience with plant hire or construction, but having spent years playing and managing professional cricket, in Port Elizabeth and the UK, he understood that creating a winning attitude was the key to success.
“Skills can be taught, commitment and passion can’t, and from my limited experience, it’s the latter that are key to franchising success.
“I explored smaller businesses, including coffee shops, but the risks for a start-up operation were too great.
“I was fortunate to meet the Talisman team. We clicked.
“There was an opening for a franchise in East London. They put me through a demanding assessment programme, including a psychometric evaluation.
“They made me feel at home, part of the team.”
Bowen’s advice to any potential franchisee is understanding the culture of the franchisor before signing.
“When I opened I had already been through an intense training programme. While we were getting ready to launch, I had head office staff covering every facet: Finance, bookkeeping, store layout, mechanical, operations and management.”
The franchise fees were beyond Bowen’s short-term budget, a problem that Bowen feels many people would face. “The company felt that I was the right person and it invested in me, by granting me several payment options and extensions.
“New franchisees should explore the flexibility of the company they are joining.
“I would advise people to steer away from franchisors who put profit above people.”
Mentorship plays a huge role in success, said Bowen.
“Before investing, people should try to talk to as many owners as possible, and use their feedback.
“Look for mentors, people you respect, especially in areas of personal weakness.” He disagrees with the advice that owners should avoid micro-managing.
“As a new franchisee, I felt I had to know everything about everything. I had to be hands- on. I met every client. I visited their offices and sites.
“I cleaned machines, did deliveries, paid accounts, getting to understand my business. I micro-manage less now, but it was a great learning curve.”
Bad debt was Bowen’s biggest nightmare, and this cost him dearly.
Several of his clients sub-contracted or worked directly for municipalities or government. “Many of them were either paid late or not at all, and went under. It left us with a problem. Now we are more careful.”
One of the country’s most successful medium-sized franchises is Postnet. Kim Muller owns one of the 360 shops.
“Looking back, we were really lucky when we purchased the business 13 years ago because we had not done exhaustive research.
“We saw it, liked it and paid…If I had my time again, I would still buy into a franchise. It takes away the challenges of building a brand.”
Muller advises any person looking at investing in a franchise to learn everything about the franchisor.
“Also check the competition, and other franchises in the area. Speak to people. If it’s a new franchise, is there a demand.”
If potential franchisees have any concerns about the good-standing of a franchisor they are hoping to join, a call to the Franchise Association of Southern Africa (Safa) should clear up any confusion.
The association represents franchisors, franchisees and the professional organisations that service the franchise industry...