Have you considered the value of your knowledge to the International Market?
Professor Roy Seaman, MD of Franchise Development Services, shares his thoughts on making a successful move into the global market
Franchisors worldwide are being asked to fast-track their international franchise offering. The reason is that today’s international investors can see the advantage of the knowledge available from franchisors. Franchisors with 10 or more years accumulated knowledge, as well as companies that have been trading for many years but may not have offered a franchise package in their home market are particularly ripe for franchising internationally. They have a wonderful opportunity to package and sell their knowledge of the products and services at the core of their business. In some instances, substantial sums of money have been invested by Master Franchise Owners and Area Developers for the know-how that surrounds their basic product or service. A good example is that of brands from the portfolio of the Dwyer Group. This brand, which started in Waco, Texas, in 1981 offering basic services, now has around 1,700 franchise owners in 21 countries operating under brands such as Rainbow International, the restoration and cleaning franchise, through to Aire Serv heating and air conditioning, Mr Electric, Drain Doctor and others. The key to their success is the way that they teach, train and motivate their franchise owners. That was the reason why a British brewery paid £500,000 to obtain their Master Franchise Rights for the UK. The question we ask today is what is the real value of your knowledge and how are you going to earn from that knowledge, other than by offering a franchise?
It may be that if you can packet your knowledge around your basic product and service then you will be able to earn what you are really worth. Should you not be able to do this, you are left to continue to just sell your basic products and services. Another good example is Dyno Rod. Imagine the inventor had sold the product that was, and still is, at the heart of the Dyno Rod business. That cutting edge instrument – the high powered water jet – is at the epicentre of the firms success. Take the time to identify your values and systems and practise them better than any competitor. This will provide you with the competitive advantage in your marketplace.
Today, around 1,000 British companies are franchising in the UK. In addition, hundreds of companies are considering the idea of expansion by franchising. They should not be put off putting down some basic foundations for their future franchise development opportunity in the current economic climate. They should start to lay those foundations and look at the opportunities that exist in certain countries around the world. Their knowledge and added passion is the essential criteria for developing international markets to their full potential. In some sectors, it may take five or 10 years before economic recovery takes place, so why not go where the money is? Take Dubai, and other centres in the UAE. These entrepreneurs have substantial funds, good executive and management teams and they are seeking businesses that they do not want to start from scratch. They wish to buy into a successful business by way of purchasing the Licence or Franchising Rights, ideally from British companies and other markets where they know good infrastructure exists. Should that infrastructure be in place, it does not take too much time or money to put together a compelling offer of your ‘genuine international opportunity’. A seminar will be taking place later this year entitled ‘How to Prepare for International Franchise Development’. Should you wish to participate in this event, please register early as places are strictly limited to 12 people with a maximum of two per company.