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Franchise success is looking after franchisees
Written on the 22 September 2009 by Lorelle Frazer
The secret to franchise success is looking after your franchisees, according to Franchised Food Company Executive Chairman and former Brumby’s Managing Director, Michael Sherlock.
That’s how he transformed an ailing bakery chain into the leading Australian and New Zealand bakery franchise, Brumby’s.
He also grew the share price nearly six times over, from 56¢ to $3.40 in little more than three years.
Michael first became involved with the bakery business, in1979 now known as Brumby’s, through a yoga ‘cult’ that he was involved with.
When the bakery business went into receivership in 1988, Michael put together a group of franchisees, management and a supplier, to purchase the bakery chain from the foundation ruins.
At this stage the bakery chain had a par share value of 1¢ each, but under Michael’s franchise recruitment, site selection and leadership Brumby’s was transformed.
The franchise grew from six stores in 1979 to 320 in 2007 stores, including the launch of new concept stores, Brumby’s Go!
In 2007 the ASX-listed Retail Food Group made an unconditional offer of $3.40 for each Brumby’s share, driving shareholder value from $6 million to $46 million in 3 years.
Secret to franchise success
Michael said the secret for his success was clear.
“Look after your franchisees and create a good culture,” Michael said.
“You should also make money out of focusing on operations, not just store openings; and you need to give your franchisees the support and systems they require.”
Michael is a firm believer in franchising as the ideal business model and also works with Krispy Krème doughnuts and Western Australian franchise brand Jesters before joining the Franchised Food Company earlier this month.
Michael’s experience in growing franchise brands will be invaluable to the Franchised Food Company, which has just acquired the Cold Rock Ice-Cream franchise and is looking to expand its current brands, Mr Whippy and Pretzel World.
According to Michael, the company will spend the next three months reviewing its brands before continuing the expansion of those brands and further acquisitions.
Speaking at the Franchise Forum 2009: How the best thrive in any environment, Michael will share insights and advice gained over his 30 years of experience with franchising and branding, and explore innovation in franchising and management.
More specifically, Michael will provide tips on how he successfully:
Find out more at the Franchise Forum 2009: How the best thrive in any environment. Early bird tickets available now!
Author: Lorelle Frazer