The first year in franchising
CeX’s Northern Franchise Manager, Mark Spreckley, reveals what franchise owners should expect in the early stages of running their business.
Setting up your own business is always an exciting and often daunting prospect for would-be entrepreneurs. One of the reasons franchising is popular is that it gives prospective franchise owners the opportunity to invest in a successful and proven business model.
High street second-hand gaming and electronics retailer, CeX, has more than 140 stores in the UK, of which 82 are owned by franchise owners. We are looking for a particular type of individual capable of running a fast-paced retail operation successfully.
Our training and careful assessment of prospective franchise owners is all-important. We want them to be profitable and will support them on an ongoing basis to ensure they can maximise the potential from their business. We have some excellent franchise owners who have developed into very successful business owners with multi-site operations within CeX.
Most new CeX stores – depending on their location – are expected to turn over more than £1 million in their first year of trading. For example, Zia Nabi (pictured) of CeX Halifax opened his store in November 2010.
“I’ve had a really good first yearr of trading, which has exceeded my expectations,” reveals Zia. “We turned over just over £1 million after 51 weeks, which was a really important milestone, so I am delighted.
“In fact, my store has had such a good first year, I am already planning my second CeX store. My bank has already offered me the additional finance required, based largely, I believe, on the performance of my current CeX business during its first year.”
The CeX franchise package starts with initial training, store location identification, store design and stock selection. Once up and running, franchise owners receive ongoing training and procedure updates together with expert advice on further stock selection, testing, marketing, loss prevention and pricing updates via CeX’s bespoke EPOS system that has been specially designed over 20 years for buying and selling.
“In addition, we get the support of Regional Operations Managers who keep us on our toes,” continues Zia. “They ensure that we operate to the same standards as the other stores within CeX and help us with detailed analysis of our business performance, helping us to identify potential weaknesses, and agree strategies to resolve these.”
Our ongoing strategy is to ensure the continued success of our franchise owners, we expect like-for-like growth and we can only achieve this by ensuring our franchise owners are supported on an ongoing basis.
We provide ongoing support from different departments within the business. For example, a ‘live’ EPOS system provides a bespoke pricing and transaction process within the store and there is operational management support from Company Managers to ensure each franchise is compliant with the CeX brand guidelines and suggest solutions to any challenges they may face.
Zia concludes: “Anyone considering a franchised business should not underestimate the effort and hard work required in developing a new business. It requires total commitment – often working unsociable hours – however, the rewards are there if you are prepared to put the effort in.”