O2: Franchising with a strong brand presence

With O2 recently announcing plans to expand its retail operations via franchising, Gordon Patterson interviews O2 Sales Director Mark Stansfeld

Gordon Patterson: Why did O2 decide to franchise?
Mark Stansfeld: We see franchising as an ideal way of combining the owner-operator strengths of the franchisee with the strengths of our brand, systems, services and products. By increasing our store footprint we can offer more customers access to an O2 store where they can browse, ask questions and find out about forthcoming products and services - regardless of location.

GP: How many company stores does O2 currently operate in the UK?

MS: In Newcastle we recently opened our 300th store, which coincided with our franchise launch at the National Franchise Exhibition.

GP: How is O2 performing?
MS: We currently have 15 million customers and the brand enjoys 93 per cent awareness.

GP: What is the essence of the O2 franchise offering?
MS: The franchise programme will offer selected individuals the chance to trade under the O2 brand, owning and operating an O2 retail franchise outlet.

GP: What distinguishes O2 from other players in the marketplace?
MS: O2 is committed to putting the customer at the heart of everything it does. Franchising will allow O2 to continue to communicate with its customers in the most effective and engaging way by putting more knowledgeable staff at the front line of the customer experience. Customer loyalty is more fragile then ever and the winners in the UK market will be those who keep and inspire their customers better than anyone else.

GP: What kind of support services does O2 provide to its franchisees?
MS: Every O2 franchisee is supported by a dedicated team which includes a Franchise Manager, Training Manager and Recruitment Manager. Specially trained mentors - who are already experienced Area Managers - will guide potential applicants through the Business Planning process. In addition, franchisees will have the back-up of the O2 marketing, product supply, retail operations and finance teams from around the UK.

GP: Will O2 franchisees be awarded exclusive territories?
MS: All franchisees will have an identified area of primary marketing responsibility around their store. However, subject to approval from O2 marketing, additional marketing activitIES can be implemented beyond this area.

GP: Who is responsible for finding and/or approving the retail premises?
MS: We are keen to benefit from the local knowledge of the franchisee regarding where their potential store will be located and where they see the business opportunity.

GP: What are the key benefits of owning an O2 franchise?
MS: The combined O2 and franchise network is expected to be one of the largest mobile telecommunications retail portfolios in the UK. The strong brand presence will attract a higher footfall than an unfamiliar name and give the franchisee the opportunity to build value in their business, through a proven business model.

GP: What key requirements do you have for a prospective franchisee?
MS: It is important to be a team player, value good customer service and have respect for the brand and brand values.

GP: Will you be developing the O2 company stores further in parallel with franchised ones?
MS: Franchising is part of a strategy to ensure that O2 provides customers with the best place to shop. As well as growing the number of stores, O2 is also increasing the number of customer facing staff per store. Over the last six months O2 has already increased its retail customer facing staff and plans to hire approximately 2,000 new retail and customer service staff over the next two years.

GP: How many O2 franchisees are you looking to appoint in the UK?
MS: O2 is launching a national franchise programme for O2 retail stores across the UK. The initiative is part of a broader programme to significantly expand O2's pan-UK store portfolio. If the initial franchise stores are successful, then independent ownership through the franchise programme will become a significant part of this expansion.