We’ve got a very strong culture and talent fit is vital for us, and most good franchisors will say that you might have someone who has the money and they might have the skills, but if they’re not a culture fit, something’s going to go wrong in terms of acting contrary to the brand when they run their store.
For us, nearly all of our enquiries come through our website. I find that nearly all of our franchisees are either friends of or families of incumbent franchisees, who’ve seen their family and friends running our stores and gone, “Wow, that’s what I’d like to do”.
We love that because they’ve essentially already been told about the business and they can see that the incumbent franchisees are happy. Or we have people who call up and they’ve been buying the products for years, and they’re like, “Oh, I want to have my own Ferguson Plarre store”.
I think that franchising is hard in terms of trying to find culture-fit franchisees. So far we haven’t had a problem but we’ve got some significant growth plans for the future, and so I think it will be a challenge for any business to try and find that volume of franchisees who are a culture fit and are financially capable.
We’re not looking for people who have $300,000, who have a job, and just want an investment. It’s not the way we do the business. We want franchisees who have skin in the game, we want them getting to know customers, we want them to know exactly what their employees are doing. We see those results in our network sales.
Those franchisees that are really involved in their business get the best results. They’re also a great driver of multi-site stores. Since we’ve taken over, we’ve had a lot of franchisees put their hand up and say, “Hey, look, I’d really love a second store”. And that’s terrific for us too, as long as we’re confident that they’ve got the ability to delegate and run multi sites. If they can do that, it’s terrific.
They’re trained, they have an existing pool of staff to call on, and they know their customer base, they know how things work.
I’ve got a Geelong franchisee who has four stores. So it’s nice, and I think it’s a result of that culture that we’re trying to nurture.
Having only had the reins the last three months, I can’t comment so much on the previous 12 months but probably the Grand Final promotion which aligns pies – which are a key product for us – with the football, as pies are really associated with football.
This year, we ran a 99 cent party pie promotion and our party pies are usually $2.20, so it was a fairly significant discount. We had a lot of radio advertising and sales increased. We ran an 860% increase in those products and our new point of sale equipment will start to show when they come in for their 99 cent party pies they’re also buying some other products and getting a head around some of those transaction values.
This year and last year we also promoted our footy cupcakes, which was also really strong.
When I took over we had two company stores that were run unprofitably for many years.
That wasn’t a reflection on the retail staff it was more that we didn’t have a culture of performance managing our own stores.
They were still good stores, and we had them for many years, but they weren’t as good as they could have been, and they certainly weren’t as good as they could’ve been in the hands of franchisees. So it’s very rare in the Ferguson Plarre history that we’ve had to make anyone redundant, but we really were in a position with this store.
I had a franchisee who had been interested prior to us buying out our partners, and the deal had been spoken about. So we took over and there was really an obligation for us to continue with that and it involved some retail staff members of ours having to be made redundant. It was a pretty frantic pace after taking over, there were a lot of operational things that we were doing and our human resources manager had met with the staff and I thought things were going okay.
But there were a couple of staff members, and one in particular, who had been with us for over 20 years. We offered them some jobs in other franchised stores, and everything was pretty smooth.
Then about two weeks later someone popped up on Facebook, where I think a cousin or an associate of this employee had said, “Oh, you know, how ordinary is this, such and such had been with the company for over 20 years and didn’t even get a phone call from the boss”. It was a massive reflection on me, and rightfully so. I was busy, but I don’t think that’s any excuse. I had been given a phone number and I tried calling this employee but the number was an old, obsolete number, and I’d left it at that. I hadn’t recognised the depth of employment.
I’ve talked about all those things about history and culture and family, and it became very obvious to me when that thing came across on Facebook that there’s no defending that kind of action. I immediately made contact with her or tried to get her details, and cap in hand, apologised, and told her that my family would be mortified and that I was just really very sorry that we hadn’t communicated better.
So I think in those situations, honesty is the best approach. She was very happy I’d offered to go and catch up and have a coffee, and I thought that was all really a little bit too little, too late. But I thought it was something that I needed to do. So I felt very bad, but I think the response back from this employee and their cousin was very positive, and they posted back on Facebook that they were happy with the way that I’d responded.
Regardless of how that ended, I just think that it was very contrary to the way that I say that we do business and culture, for me to have let that happen, that someone worked with us for 20 years honourably, day in and day out, and we took over and let her go with not nearly enough communication.
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Cara Waters is a former SmartCompany editor. Previously, Cara was a senior reporter for the Financial Times’ website and worked for The Sunday Times in London.
