Not so Comprehensive Spending Review
Dan Archer - Franchise Development Director, X-Press Legal Services - Director, BFA
Much fuss and many hours of speculation and what has the comprehensive spending review delivered? The answer is not much detail. The headlines do contain big numbers on a scale that it is often difficult to quantify but the 106 page long published review document is still an overview rather than the detail of where the axe will fall.
I have struggled with the whole process if I am completely honest. I recognise that the Media want a certain slant on the impact of what has been variously described as “austerity”, “big society” and “the most scathing public sector cuts sine the 70’s”. I also understand that while BBC and SKY perpetuate the myth that 24hr news is feasible, there will always be a temptation to proffer poorly conceived arguments and half baked statements as fact, when they are really just opinion which is deliberately structured to promote debate and fill airtime. What I cannot really get my head round is the public sector NIMBYs who acknowledge the need for cuts but only really cuts in someone else’s budget.
Now I am not naïve enough to think that most of what Derek Simpson has said in relation to the cuts has been said for any other reason than to use the media to lobby for spending review temperance. I also see the nonsense over defence, the US and Afganistan for what it really is which is proof that the military are substantially better when it comes to influencing policy than UNITE are – sorry General Simpson. I do however question whether so many of those in public service that have said “cut but don’t cut here” are publicly focused or self concerned?
The reality is that the impact of the current financial situation is so far reaching that we will all be touched by change. Businesses have, our business and our franchisees took the bull by the horns in late 2008, most other private sector concerns have also focused on efficiency, scaled back staffing and forensically analysed spending. The problem for the public sector is that it doesn’t on the whole, deal with commercial realities so rather than doing the right thing to survive and thrive, it has to wait for a comprehensive spending review and mandatory changes.
Some want to blame the bankers for our current plight, which is a little like saying I abhor cock fighting and despite the evidence that others organise, train, run the book on and promote the fights it is the cocks that are to blame. So you decide, those that regulate the banks or the cocks themselves.
The basic political principle behind our current situation is that we have had 13 years of Labour government and Labour have traditionally believed in centralised, controlling, big government. It turns out that we couldn’t afford this during the boom times and we most definitely cannot afford it now. So we now face a political correction as we did in the early 80’s when the other end of the political spectrum will scale back the big government and deliver if we believe them the “Big Society”.
My fear is that despite the 51% cut to the CLG Communities budget and the 27% to the CLG Local Government budget (2 areas that our business is particularly interested in) the stated political principles will still not be realised. Government has always grown consistently and will probably continue to do so. 490k jobs may be cut and they will most likely replaced by subcontracted public sector employees not directly employed but not the smaller government that has been discussed.
As a franchise business we run a very tight ship, the investment, effort and application of our franchisees has ensured that throughout the downturn we have continued to grow our business. Could the public sector learn from what we do? – yes. Will it while the commercial advice that politicians take comes from the likes of Phillip Green? – no. Mr Osborne and Mr Cameron would do well to junk the rhetoric and if they really want to know about efficiency look to the franchise industry. The door to my hippy commune is always open gents.
Dan Archer is Franchise Development Director for X-Press Legal Services and is a Board Member of the British Franchise Association. You can follow Dan on twitter by visiting www.twitter.com/therealdarcher
Could a Franchise Business be right for you?
Nick Strong, MD - Select Your Franchise
Starting up your own business is often seen by many as an ideal business option: making your own money, managing your own time, flexibility, to name just a few benefits. However, statistically most business start-ups fail. Another option to consider is franchising since successive British Franchise Association/NatWest national surveys report that over 90% of franchisees operate profitably in any given year. This statistic is hard to ignore. With such a high success rate the choice between going it completely alone or whether to take start up a franchise business seems almost a “no brainer”. However, not everyone is suited to franchising so its important to assess whether its right for you.
The Ideal Franchisee
The general feeling in franchise circles is that those with an entrepreneurial personality often don’t make the best franchisees. Surely this can’t be right I hear you ask? An entrepreneur seems on the face of it to be ideal since surely they are motivated to start up new projects and work with new ideas. However its just this need and drive to innovate and develop their own ideas that becomes a potential stumbling block for both the franchisor and franchisee alike. They enjoy pushing the boundaries and trying new things. A franchise requires someone to ‘follow’ a proven system. That is to say, someone that stays within the boundaries of what is proven to work. Because of this an entrepreneur can often be a person that is pulling in the opposite direction to the principle of franchising. To be a success, franchisees follow the proven system and succeed as a direct result of following that proven system.
So who makes an ideal franchisee?
There are certain personality traits that are necessary to be a successful franchisee:-
- Enthusiastic and passionate about the franchise business
- Dedicated and hard working
- Most importantly, they are FOLLOWERS of the system
To be successful, a franchisee needs to be a believer in the system they are following, or an enthusiastic disciple. Franchisees do not and should not feel the need to change the system which is already proven to work. In fact, a franchisee could lose their franchise completely if they decide to not follow the system.
A high performing franchisee will always be an ‘enthusiastic disciple of the system’ he or she works under. This means that anyone that buys a franchise should be convinced in their minds that they do in fact completely believe in the system and support on offer. Franchisees do not have power to change a system. In fact a franchisee can loose their franchise by not following the system. Why is this?
So what are the key benefits to the system that makes the franchise what it is?
- The system is the heart and what gives the franchise value
- The system has been proven to be successful over time
- The system provides identity and branding
- The system becomes the expected service/product by customers
By wandering off the proven path the brand and customer expectation is undermined. Imagine going into a McDonalds restaurant and they were serving a roast dinner which you had to wait 30 minutes for them to cook. Firstly, you would be confused since you really wanted a burger and fries and second you would probably go elsewhere because you expected to be in and out with a takeaway meal in 5 minutes!
This is why a franchise succeeds, because your expectation is met no matter which franchised outlet you go to. Anyone deciding to do things differently is more than likely to fail and hurt the entire brand.
The system is king in franchising. Those who follow it with determination and enthusiasm are most likely to be in the 90% of successful and profitable franchises in UK. If you are entrepreneurial, then be aware that your own tendency to try new things and do things your own way could be a stumbling block to you in running a successful franchise.
Franchise News: Franchisee of the Year Awards 2010
Cathryn Hayes - HSBC Head of Franchising
Nominations are now open for the bfa HSBC Franchisee of the Year Awards 2010. The awards, supported by Express Newspapers, highlight the outstanding efforts, achievements and stories of leading franchisees across the country.
Now celebrating its 21st year, and with a new regional format for 2010, the awards recognise franchisees that have demonstrated the highest levels of quality and best practice. As the UK moves into recovery, the awards offer franchisees the opportunity to showcase how they have harnessed innovative ideas and initiatives to create business opportunities and overcome the challenges of the recession.
The awards for this year will include a regional winner for each of five regions.
These are: London & the South East, the South West, the Midlands, the North and Scotland. For the first time, franchisors are able to enter up to five of their franchisees for the awards, one nomination per region.
The Gold Winner of the Award will receive £5,000 from HSBC, together with a commemorative trophy and the title bfa HSBC Franchisee of the Year. The Silver and Bronze Winners will receive £3,000 and £2,000 respectively, courtesy of HSBC. The five regional winners will each receive £500, again courtesy of HSBC.
The deadline for entries is 30 June 2010 and finalists will be invited for interview with the judging panel on 15 July. Winners will be announced at a gala dinner, being held at the NEC in Birmingham, on 30 September 2010.
bfa members should have already received their entry forms in the post, but additional entry forms can be downloaded from the Awards section of www.thebfa.org.
