Reflections on Franchising
In 2003 The Franchise Magazine's Dr Dennis Chaplin interviewed the co-founder of the British Franchise Association Tony Jacobsen. To commemorate Mr Jacobsen's recent passing, TheFranchiseMagazine.net has pulled the article up out of the archives
FRANCHISING in the UK is really soaring now, a net contributor to the economy and employment - as documented in the latest British Franchise Association (BFA) and NatWest report on the state of the industry in 2003. But it's been a tough route getting it right.
For BFA Founder Member and first Director Tony Jacobsen (pictured right, with his wife Christine who served the BFA as Administrative Secretary), the fascination with franchising began during his long and distinguished career in industry, beginning with Westland Aircraft, Thomas Firth and John Brown.
It was when he progressed from a Planning Engineer to a Factory Manager that he really began to appreciate the benefits of franchising. 'Much of the workload for the various plants was provided through international manufacturing licences from the USA, Sweden and other countries,' he recalls. Licences usually dealt with the transfer of technology, intellectual property and skilled personnel.
By 1964 Tony established his own consultancy service - Jacobsen & Partners - and for over 30 years it served a wide range of clients, with emphasis on technology transfer, licensing and overseas property development. The company also provided a specialised service in Behavioural Science as applied to Commerce and Industry, based on American and European practice.
The concept's great, but... Ziebart International Corporation of America was the first actual franchising company Tony encountered. In 1968, the founder of Ziebart Rust-proofing approached The Institution of Product Engineers asking for help in establishing a Master Franchise in the UK.
Tony, who belonged to this professional institution, was the logical contact and after an initial meeting, he started seeking a suitable Master Franchisee, succeeding rather quickly. 'I identified Ziebart rustproofing as an exceptional product in that it genuinely prevented rust damage to motor vehicles,' comments Tony. 'It showed the British public that car manufacturers were not protecting their products properly, which was quite a revelation at the time.'
Unfortunately, he reflects, 'Ziebart UK Mk One took a number of wrong turnings - for example, giving all customers a 10 year fully unconditional guarantee and having a screening process for appointing initial franchisees which was less than perfect, leading to a heavy fall-out rate during the first crucial years.'
Mistakes are great teachers... However Tony, along with those involved in Ziebart UK, felt they could learn from their mistakes and thereby help others thinking about franchising their business. That's why the Ziebart UK of the 21st century owes much to all the valuable lessons learnt and acted upon all those decades ago.
These educative endeavours led eventually to the formation in 1977 of the British Franchise Association, specifically to represent and perfect the 'Business Format Franchise System'. Tony and his wife Christine, then the Director and the Administrative Secretary respectively, are now Honorary BFA Affiliate Members. 'The image of franchising has been very well served by both the International Franchise Association and then by our very own British Franchise Association,' agrees Tony, leading him to believe that 'on the face of it so far, there does not appear to be any need whatsoever for Government regulation of the industry. Its players have been performing their own regulation admirably - especially in that the BFA began on didactic, remedial foundations.'
Franchising's future role... On the future of franchising, Tony feels that 'a great deal more could be done in terms of fostering world trade and the development of backward countries by applying true franchising, which is a natural multiplier of SMEs and the related employment opportunities.'
Parallel to setting up the BFA, Tony and Christine still found time to help establish and nurture The Foundation for Science and Technology, based on the Clunies Ross Foundation in Australia, designed to promote the transfer of technology and the exchange of ideas to help developing economies.
The Jacobsens wanted to see similar centres set up in the UK and the Commonwealth which would focus on the 'Transfer of Technology' and ideas. It was aimed at individuals and organisations across a broad range of society, including academics, politicians, industrialists, bankers and people of influence. Like the BFA, this organisation was successful in the UK but did not develop overseas, Tony blaming the demise of the Commonwealth.
In considering the future, Tony believes that 'we should and can look to the past. A generation ago, we had the task of learning about the systems and benefits flowing from franchising from the USA. Then we had the task in the UK of educating the press, banks, government and public in the franchising route to marketing products and services.
'It was hard work, but I believe the BFA and its more active members have been rather successful in achieving that, especially bestowing on franchising a respectability it sorely lacked in the early days, when many people wrongly but understandably confused it with pyramid selling and network marketing - which it is not.'
The task for the next generation and its successors, suggests Tony, is 'once again to educate people in the advantages and mechanics of business format franchising - first, the international organisations, the bankers, benefactors and aid-bodies, and secondly, the third world and ex-COMECON countries and their governments. For franchising, as we have proved, delivers enormous benefits to national economies.'