Highly Profitable and Recession-Proof
After achieving a seven figure turnover in his first year, John Hollins, is continuing to achieve growth despite the recession
When John Hollins opened his first CeX store his business plan was based on his expectation of achieving a year one turnover of £850,000. However, after achieving an incredible £1.1 million turnover in his first 12 months, he is pleased to be on target to increase this to £1.2 million in year two despite the recession. "One of the great aspects of a CeX franchise is that it has a highly profitable business model that is recession-proof as well as working well when the economy is strong," he says.
John had not worked in retail before becoming a CeX franchise owner. "I was a hotelier in the small to medium market. I realised that I needed a change and, despite the fact that I could have re-invested in the hotel industry, I wanted something that would provide better return on my capital so I decided to look into franchising. I read about CeX in The Franchise Magazine and was impressed because it has been operating for 17 years and so it was clear that the company knows what it is doing. I also spoke to CeX franchise owners before launching, such as Steve Bolt who now owns three stores, and all of them are delighted. "I've always liked gadgets and I get to sell something that we all use. The business model is very simple and it is easy to understand - in my first week of trading I was confident that my expectations were going to be met. As you buy products from customers as well as selling them you don't have to worry about buying stock. It's great to know that all the money you've taken after a day of trading is your money."
Founded in 1992 CeX has been expanding steadily across the UK. CeX stores buy, sell and exchange a range of technological goods including video games, DVDs, mobile phones, computers, digital electronics and music. As part of its franchise package CeX offers franchise owners training and ongoing support. John says: "Before launching my business I had access to as much training as I wanted. I spent a week in a store in Wolverhampton and I spent time in stores in Leeds and Wakefield. I feel entirely comfortable within the organisation, which is very professional and easy going. Hugh Man, the Franchise Director, has been especially supportive."
With ambitions to expand his business and own and operate as many stores as possible, John is confident that CeX will provide the support he needs to achieve his aims: "I'm about to open my second store in Sunderland and I'm looking to have at least three shops open in the future. As a franchise owner it is important to be able to trust the franchisor, which I feel I can do with CeX."
Interview by Derin Ibrahim