January 2009 Archives

Ever wondered about the history of franchising? Below is some of the back-story:

The word franchise comes from the old French meaning, privilege or freedom. In the middle ages, Kings would grant franchises to select subjects, for all manner of commercial activities, such as building roads and brewing ale. Essentially, the King would give someone the right to a monopoly for a certain type of commercial activity. Over time, the regulations governing franchises became part of European Common Law.

In the 1840's in Germany, certain major ale brewers granted franchises to certain taverns, giving those taverns the exclusive right to sell their ale, essentially starting the concept of franchising as we know it today.

In 1851, Isaac Singer invented the Singer Sewing Machine. During his search for an effective and affordable way to distribute his product for his company, the Singer Sewing Centre, Singer ran into problems that prevented his company from becoming successful.

Singer faced two specific problems. Firstly, he had a lack of capital to invest in the manufacturing of the machines. Secondly, no one wanted to purchase a machine they did not know how to use, and mainstream retailers were not interested in investing the time to train purchasers on how the use the merchandise. Singer's solution was to find individuals who were willing to purchase licensing fees that would give them the right to sell the sewing machine in exclusive geographical areas. These individuals were required to train their purchasers on how to use the sewing machine, thereby creating new sales opportunities. From this solution, Singer was able to apply the licensing fees received to the manufacturing of machines that were shipped directly to his licensed distributors.

Other companies took notice of Singer's concept, and over the course of several decades, developed the methodology to enhance their own business models. Coca Cola, and their franchising of their bottling and manufacturing of their soda in the late 1890s is an example of this.

I had a good chuckle reading article below and I have already taken several things on board. The first being, to pair down the checklist. However, I can't bring myself to throw it out completely, as there are some things are still absolutely essential -- ie. honesty and integrity. And oh yeah, being in serious like/love with me!!!

The Sunday Times, January 11, 2009
How to meet a man at 40: It doesn't get any easier the older you get. So just how do you win the dating game
Shane Watson

Before we get started, you need to know that the man you fall in love with will bear absolutely no resemblance to the man you were planning to fall in love with. He will live an hour away from where you live, minimum. He will be wearing a shiny suit and, possibly, a brown shirt. And he'll have the sort of baggage that requires its own baggage handler. This much you can guarantee.

Because one of the reasons you are single (and this is the only one that is strictly your fault) is that you have written off every kind of man who might conceivably cross your path. You have built a fortress out of your preconditions and you are glowering down from the battlements. Men do approach from time to time, but then they see the vats of boiling oil teetering on the ramparts and think better of it.

As far as you are concerned, this fortress is a normal precaution for vetting prospective men, and so it was, initially. Then time passed, you settled into a routine and now you are mistress of the You Won't Get Past Me checklist.

As it happens, I was set up with the One at a lunch three years before the party at which we officially met. The reason the lunch doesn't count as the first meeting is because we barely spoke, and the reason we didn't speak is because I ran his details through the List database and, in 0.2 seconds, it came up with a You Cannot Be Serious rating. Of course it did! The One was very recently divorced (not for me, thanks). He had three children in tow (uh-oh). I think he'd had a savage £5 haircut, and I'm almost certain he was wearing the brown shirt. So, at that first meeting, I summoned the List and the List gave me permission to do nothing.

This List, let's be clear, is not made up of sensible broad guidelines such as must not be married or should live on same continent; it is extremely specific. Here are some edited highlights from my List, and I'm not making a word of it up:

- Must have hair. Hair is good, but what if top of his List was "must have large breasts"? That puts a rather different complexion on it, doesn't it?

- Must not have ex-wife or children. Like the pool isn't small enough as it is.

- Must not wear fleeces. The bulky navy ones. I'm not going to budge on this one. Fleeces say you're the kind of man who takes his wife to the pub for your anniversary dinner.

- Must not wear short-sleeved shirts. See fleeces. Add golf/ cricket/rugby club to anniversary venue.

- Must not wear jewellery. Although you can tell a lot from jewellery. Any man wearing a leather-thong necklace is certainly a narcissist who still imagines he could have been in the Rolling Stones. Pierced earrings past the age of 40 equal midlife-crisis man. Gold chains on a mahogany chest are the equivalent of the long little fingernail (just plain sleazy).

- Must have a good job, but not one that requires him to get up at 5.30am and take a laptop on holiday.

- Must not wear hoodies or V-neck sweaters with nothing underneath. Hoodies are for boys. And "nothing underneath" is another I Love Myself sign, only this time there's also the suggestion of And I Am Hot in Bed.

While the British Franchise Association is the largest and most successful franchise association in Europe -- it represents less than 50% of the UK franchisors. Thus, in 2008, the organisation which was established in 1977 published a consultative document titled One Vision with the express purpose of engaging the franchising community on how to become a more representative organisation.

The aim of the publication was to kick off a strategic review as the British Franchise Association would like to be recognised as the authoritative voice of UK franchising and as such, needs to figure out ways to get more franchisors involved. In addition, the organisation needs to be more inclusive and begin to represent the interest of franchisees as well as the specialist professional advisors (consultants, lawyers, accountants, etc) involved in franchising.

Beyond being more inclusive, the objectives of the strategic review are to determine best ways:

1) to set standards with Members for ethical franchising; secure adherence by members of those standards; and promote their adoption by non-members within the franchise community
2) to promote, in partnership with Members, positive awareness of ethical franchising amongst the general public as prospective franchisees and as consumers and amongst employees in the franchise community
3) to promote and protect the reputation of franchising with government, business, academia and the media
4) to secure in the UK, and help secure in Europe and the world, a legislative and regulatory environment for ethnical franchising which encourages its profitable growth
5) to operate with funding from, and for the benefit of, the community of Members as a whole with equity, integrity and efficiency through representative and transparent governance

Recognising that there are inevitable challenges with changing the status quo, the task group solicited feedback via an online questionnaire. The proposed changes were also presented at the Association's 2008 Annual General Meeting in December. Thus, it is expected that depending on the level of consensus, new articles for the association would follow in 2009. So stay tuned. In the interim, you can download the One Vision consultative document from the British Franchise Association Internet site.

Results from the 2008 NatWest/BFA franchising survey confirm that there are approximately 809 active franchise businesses generating £12.4Billion in revenue. Surprisingly, only 324 systems (40%) are active members of the British Franchise Association (BFA).

Of those franchisors that are part of the BFA, they are governed by a code of ethical conduct which comprises the European Code of Ethics for Franchising and the BFA's own "extension and interpretation" of the code.

The European code came into effect in 1972 and was drawn up by the European Franchise Federation (EFF), the trade body of the national franchisors' associations within Europe. Each country has the opportunity to add its own extensions and interpretations, subject to the approval of the EFF.

Visit the European Franchise Federation Internet site, to read the full text of the European Code of Ethics for Franchising. For the British Franchise Association Code of Ethical Conduct: Extension and Interpretation, go here.

Below is an excerpt of an article I wrote for Women Unlimited on how to finance a franchise business.

Banks Will Lend 50-70% Needed to Launch a Franchise Business

by Ursula Barzey, Women Unlimited, 6 January 2009

Most franchisors require that their franchisee candidates have a certain level of net worth and liquidity as part of their qualification process. This requirement is in place as bank funding is typically needed to secure some of the money needed to get the business up and running. For example, if opening a retail franchise, a franchisee candidate will need to budget for:

• Franchise Fee
• Opening Cost: Training Course, Operational Manuals, Site Selection, Start-Up Materials, Legal and Management Fees, Build-Out Supervision, etc.
• Initial Marketing Costs
• Store Development Costs: Signage, Equipment, Computers, Fixtures, Displays, etc.
• Initial Inventory
• Other Expenditures: Rent, Security Deposits, Insurance, Licenses, Permits, Staff Advertising, Travel, Accommodations, etc.
• Working Capital: 3 to 6 months

Once you start putting together the budget figures, most franchisee candidates begin to realise that setting up a retail franchise takes more than entrepreneurial verve; it requires a substantial amount of start-up capital to begin with. In fact, according to the 2008 NatWest BFA Franchise Survey, the total start-up cost for a store retail franchise is typically around £160K. The average start-up fee across all franchise operations is £64,900.

To read the article in full, visit the Women Unlimited Internet site.

If it isn't already obvious, I am on a journey.

I just love this video; so inspirational. It advocates freedom through self empowerment.

As some of you may recall, during the early days of the American-led war with Iraq, I developed a serious crush on Brigadier General Vincent Brooks. He was frequently on televsion as he was the spokesperson for the U.S. Army Central Command. Back then, very little was known about him. Now he has his own Wiki page and can't help steer longingly at his picture. Perhaps its the uniform. He is so distinguished. On a more serious note, there is also a great profile of the General on the HW Wilson Company site.

A recent disappointment had me thinking of going on a long Forest Gump type run. But I realised that really wasn't the best course of action. So instead, I decided I would go walking for an hour each day -- for 21 days. 21 days because that's how long it typically takes to create or change a habit. That was 2 days ago, so only another 19 more before goal is accomplished. For the record, this is not a new year's resolution. It is simply a course of action -- along with regular visits to an acupuncturist -- to improve health and manage stress.

Goodness! Where did the time go?

With my last serious blog post, I was pontificating about my desire to see Senator Barack Obama ascend to the Presidency of the United States. Thankfully, I was not disappointed. Now, almost two months later, it seems like a lifetime away.

Perhaps it has something to do with the New Year! Perhaps also it has something to do with the fact that I'm been super busy with my new work venture. As you may have figured out, I left the safety of the corporate world and started up my own business. The economic news is not great, but considering the nature of the business, I am quite optimistic about the future.

On a personal note, I'm still single. Both Racquetball and AirportGuy made re-appearances late in the year, but the reality is that neither are husband material. Sad really, as both relationships started off with so much promise. More recently, I met someone who I thought had promise. But alas, he turns out to have a fiancée. Further proof that the good ones are mostly all taken. Even still, I have a really good feeling about 2009. My business is taking off and I'm really hopeful about things on a personal level. I have to be -- I turn 39 this year. Yikes! So I created a lovely vision board with photos representing my desired future.

I know, it's a bit over the top, but this was my motivation for making the changes I've done so far. And let me say that I'm finally starting to believe that everything is possible and every day is better than the last.

In honour of the New Year, a poem from one of my favourite authors:

Dreams

Hold fast to dreams
For if dreams die
Life is a broken-winged bird
That cannot fly.

Hold fast to dreams
For when dreams go
Life is a barren field
Frozen with snow.

—Langston Hughes(American Writer)