STILL FILLING IN HOLES
James Fielder switched from being a dental
Therapist to a Superfinish Express Franchisee
13 years ago.
“ I don’t feel burnt out at all. Instead of working hard, you work
smart. I only work a 35-hour week. I have a week off when I want to
and I love what I do”, James says. “I’m still filling holes, but they’re
not in teeth – and cars don’t scream as much!
“ The best attribute of the Superfinish Express system is that you’re
paying your fees as a franchisee for someone else to do the cash flow, and you don’t have to spend time chasing invoices. We invoice the
customer, tally up our invoices each week and send that through to head office. They take out their fee and the remaining money is put in my bank account and they carry the debt,” he says. “As a result of being a franchisee, I have had the opportunity to start my own company and that has given me great financial opportunities and chances for wealth development”.
James forcuses on servicing car yards that may need to restore or touch up a car’s paintwork to prepare it for sale. “Superfinish helps you to get the customers when you set up, and then it is up to you to establish the good working relationship with them”, he says. It is the “unique technology” Superfinish uses, James says, that helps to keep customers satisfied.
“There are other companies who think they have got just as good a system, but our technology is superior”.
One of a kind
This year’s table of winning franchisors is also dominated by systems that originated in Australia, rather than those that are imported. One new entrant in the less-than-$50,000 initial investment category, Superfinish Express, is an example of cleverly fitting imported technology into a home-grown franchise system with unique characteristics. That helped give it a score of 75 per cent, ranking it equal second in its category. “We all know most businesses fail in the first couple of years. It’s not because they’re not good businesses, it’s because they don’t manage their cash flow,” Superfinish director and founder David Bruckshaw says. “We’ve taken 80 per cent of that risk of failure away, because the franchisor does the billing and the bill chasing, so the franchisees can just keep their head down and focus on earning the money. The franchisees send in copies of their invoices once a week, we take out our fees and deposit the remainder into their account within two working days. “We also structure our ongoing management fee on a reducing scale, which is the complete opposite of the tax system and creates an incentive for franchisees to keep wanting to earn more. Our fees decrease after you’ve been with us for a number of years, whereas other franchisors increase their fees by quite a hefty amount for the longer-serving franchisees”.
In for the long haul
AFR Smart Investor looks for long initial franchise agreement periods when assessing franchisors with good renewal prospects. The Superfinish initial franchise period is four years, which is the shortest of any of our recommended systems; but Bruckshaw explains that Superfinish offers two further four-year renewable options.
“I chose an initial four-year period because my research showed that the burnout period for service franchises is between two and three years,” he says.
“But after being in this business for 15 years, I have found that people want to stay. “And with our renewable options, we don’t charge franchisees a renewal fee and we will change our tiered structure if they stay with us, so they will be offered a reduced ongoing fee”. Bruckshaw describes himself as a sixth-generation paint repairer who was working in Britain when he “saw people touching up cars in the US in a mobile situation”. He has since imported the technology behind Superfinish from California, and boasts that it can spray a car with near zero overspray.
Some of Superfinish’s highest-earning franchisees don’t have a trade background. What they do have is a positive attitude. Training is all about attitude and action, care and commitment, effort and ethics, service and smiles. It’s one-on-one, not in a classroom. We focus on the individual franchisee and we don’t let them leave until they pass all the tests and tick all the boxes.
Good Support
The Superfinish process sounds complicated, but Bruckshaw says you don’t need automotive industry experience to be a franchisee.
“Some of our highest-earning franchisees don’t have a trade background”, he says. “What they do have to have is a positive attitude. In my training process, I have a two aces system. It is all about attitude and action, care and commitment, effort and ethics, service and smiles.
“Our training is one-on-one, not in a classroom environment. We focus on the individual franchisee and we don’t let them leave until they pass all the tests and tick all the boxes.
“They then have two weeks with a qualified trainer in the field and a guaranteed income for five weeks, so they can concentrate on customer relations”.
This is another positive attribute we look for in the business systems we recommend for this article. Most of the schemes in our table don’t require you to have technical experience, but they must provide excellent training and franchisee support.
THE SI TEST
Australia has more franchisors per capita than any other country:there are more than 1000 offering their systems to potential franchisees. To make it into this year’s AFR Smart Investor table of best value franchise systems, those contenders had to:
STEP ONE:
• Be a current member of the Franchise Council of Australia.
• Have a high or growing level of national brand recognition. Those involving the sale of products need to have those products trademarked.
• Have a system with a proven track record in Australia over a number of years.
• Operate in at least three states and have new franchising units available for sale
STEP TWO:
• Require a competitive initial and total capital outlay within its peer group.
• Have comparatively low borrowing requirements and an established relationship with at least one lender to facilitate franchisee borrowing when necessary.
• Carry comparatively low ongoing franchising and marketing fees.
• Charge no non-refundable deposits.
• Levy no, or comparatively low, training costs.
• Have a comparatively long initial franchise agreement term with excellent renewal options.
• Offer excellent business planning support, initial and ongoing training.
• Generate excellent expected and average annual turnover for franchisees.
• Exhibit features that are unique to the franchising system that give it a competitive edge.
• Have the best possible territory or job alloctaions within their peer group.
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SUCCESS SYSTEMS
Jackie Pearson Financial Review Smart Investor / 01 Dec 2008 / Page: 50 / News
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