Founders of Franchising: Brian Lewis - BFA Chairman and founder of Cash Generator
From petrol pump attendant to Chairman of the British Franchise Association has been a varied and interesting journey for Brian Lewis. Stuart Anderson speaks to the Cash Generator Founder
Born in Moss Side, Manchester in 1949, Brian admits that at the age of 17, he was a petrol attendant filling up cars with no greater ambition. 'That all changed when I went to work as a Trainee Manager at a tyre depot under a couple of guys called Tom Farmer and Stephen Boler,' he recalls. 'Both guys had a major impact on my business life. Tom went on to found and sell Kwik-Fit Tyres & Exhausts, while Stephen built the Limelight Group, which included Moben, Kitchens Direct, Sharps Bedrooms and Dolphin Showers, eventually selling his shares for £60 million when it came to market in 1997. He also became the major shareholder of Manchester City Football Club.'
There is no denying their entrepreneurialism rubbed off on the young Brian, who soon left to start his own tyre and exhaust business. 'After only a few months working with those guys my ambition started to grow dramatically,' he reflects. 'I started the business with partners, and after four years I still had only a 10 per cent shareholding working seven days a week. After a major fall out on a serious issue of principle I left with not a penny in my pocket.'
Burned by this first experience of business ownership, Brian nevertheless went back into business buying a small consumer credit company with a new partner. 'The company had three staff and was almost bankrupt,' says Brian. 'My partner Stephen Choularton owned 99 per cent and I owned one per cent, but over the years I managed to buy all the equity in that company. Then I sold it in 1989, becoming a millionaire. I insisted that they pay me in cash and not their shares, because I felt their shares could go down. As it turned out I missed out - had I taken their offer of shares I would have got four times as much within six years!'
Brian's first taste of franchising came soon after when, looking to take over a pizza restaurant franchisor, he bought three pizza franchises. 'The deal had collapsed and by bad design I ended up owning the franchises to rescue my investment,' he explains. 'Being a franchisee taught me an awful lot about relationships between franchisee and franchisor - not all of it positive.'
At this point Brian owned five different businesses, and in 1995 he became determined to find a profitable niche market and become a market leader. 'I had become a jack of all trades,' he comments. 'Having started the first five Cash Generator shops, I decided to sell my other businesses to concentrate on franchising it.'
The inspiration for Cash Generator came from his travels in the USA, where he had witnessed a similar business transform itself from a backstreet store to an attractive US public company. 'I took that concept back with me and spent seven months designing the total specifications required to run my business,' says Brian. 'We started from day one with the three income streams - the retail, buyback and cheque cashing offerings.
'However, within 10 months of opening we'd changed 90 per cent of everything, including the name, colours, guarantees, uniforms and products - all after listening to our customers. When theory hits practicality, practicality always wins. For instance, the original name was 'Paragon', but we changed it because it didn't say what we did. We are a 'cash generator'.'
Before launching the franchise opportunity in 1997, Cash Generator opened five company-owned stores in deliberately chosen sites of great variety in order to test the impact of location on profitability. 'That gave me the experience to give good advice to franchisees on siting their premises,' Brian explains. 'We now have over 80 stores nationwide and big plans for expansion (see page 23). The company has made a profit every year, 650 people work under the Cash Generator banner and three months ago we bought our 20 millionth second-hand item from the British public - that proves that second-hand is popular.'
In 2002 Cash Generator won the British Franchise Association (BFA)'s 'Franchisor of the Year' special award for building and maintaining a nationwide brand, and last year Brian was appointed as BFA Chairman. 'I'm delighted to have that honour and to see that the ongoing reputation of the BFA continues to soar,' he relates. 'There is a major commitment within the association to giving its members and the public a greater voice for franchising in the UK.'
Asked how his own experiences as a franchisee and as a franchisor inform his attitude to franchising, Brian points out: 'What became painfully clear when I was a franchisee for another company is that honest communication and equal commitment to the success of each individual franchisee is absolutely necessary by both franchisor and franchisee. If that is not honestly applied, then franchising is not the answer - instead it becomes the problem. Fortunately most franchisors are ethical and respectable, but as with all investments and business decisions it is critical the individual uses 'caveat emptor' - buyer beware. You must do your own due diligence.
'Franchising in the UK is about to explode upwards and onwards as the public's understanding of the benefits of franchising continues to grow. There is an awful lot of opportunity in the UK for the industry in the years ahead.' Married and with four children grown up, Brian reflects on a life spent as his own boss since the age of 20. 'My advice is you can have an exciting future if you grasp that opportunity,' he asserts. 'It is better to have attempted it than to be sat on a park bench at 70 years of age wishing that you had.'