Tag Archives: Franchise Information

16Aug 2011

Franchise News: Starting a Letting Agency not so easy!

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By Steve Roulstone

I have been somewhat surprised to hear that after many years of insisting that the only way to start in our Industry was to have a High Street presence, with all of the associated costs that this envelops, one of our major competitors has now made a major switch and started to market a start from home operation and from what I know about the industry and process I can only surmise that this is purely a cost motivated decision, because all of the evidence from my own Franchise offices is that the need for a High Street presence has never been stronger!

Historically not needed.

I took over the running of our Franchise two years ago, prior to that, the previous Management had assisted people to open offices in not only the High Street, but also from serviced offices and from a home start. The fact that this was possible at that time is confirmed by the fact that these offices are still trading and indeed have been doing so for many years, in some cases approaching a decade! But what is also clear is that this is not the case now, as I have had confirmed as I travel around our offices and discuss current trading levels.

Inherent differences.

What has been confirmed to me is that the offices with the biggest profile are the ones that are enjoying good increases in numbers of both property and number of Landlords. (This is an import point because it needs to be recognised that the number of Landlords is growing significantly and the growth is not existing Landlords buying more properties) This is not the same when smaller offices are concerned because of the massive increase in competitors. Through both the growth in Letting Agencies and Estate Agencies ambushing our trade, the customer has very soon learnt to look around and there is no doubt that even in a technological age, the best place to look is on the High Street!

Web sites tell no story.

 There is very good sense behind this, because on the internet it is very difficult to see any difference, in fact, the better the web site does not automatically mean the better or larger the Company and because of the financial implications of a poor service, the customer has taken to seeing with their own eyes! At Stafford, I recognised several years ago that when Landlords turned to the web for research, we needed something to make us stand out from competitors. Therefore with apologies to potential Tenants, if we only listed all properties we have available (as Rightmove eventually insisted, because of course Tenants are their customers) we would not look very large, so we have left all properties on our books on our site.

Best advice.

What this current trading pattern dictates, is that any new start (as we are only too aware!) needs to look very closely at where they are going to get new opportunities, because it is only new Landlords who will become their Customers (unless you have friends with property) because Landlords do not change either easily or often! It is the practical day to day reality of Management that confirms this, because unless you make a real hash of matters, you will always have the opportunity to resolve issues before any change is reasonably possible. (Consider standing orders for rents and relationships with existing Tenants) I always believe in placing myself in the position of the potential customer and what needs to be answered may be a hard reality, but one which needs to be faced straight on; Why should Landlords choose somebody operating from home, as against the choice in the High Street?

Starting again?

Not something I would like to do again at present and explains why those considering Franchising are not exactly rushing to the plate at present! But even and probably especially in hard times, we as Franchisors need to be both truthful and realistic for the benefit of potential investors in our Companies. Without and probably until professional recognition for Letting Agents, via licensing or qualification is introduced, however the Government decide to proceed as they surely eventually will to deal with an increasing level of complaints, we have nothing to differentiate us from the rest of the market I believe that the choice for Landlords will not diminish until such legislation is produced, so until then, we have to accept where we are and why!

27May 2011

Franchise News: Franchise Networking days producing rewards.

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By Steve Roulstone

At Castle Estates we have regular Network Days where all of our Franchise offices get together and discuss our Industry at length. They give Franchisees the chance to discuss various issues with their compatriots, talking over problems that have occurred, sharing successful ventures and opportunities and trading methods and trends with each other. When we put these days together, we always try to have a central theme running through them, so that our offices can review what they have seen and review an area of trading all in one day. In the past these themes have been Web awareness, Property Insurance and associated products, Changes in legislation and Advertising.

Making the most from contacts.

This was the theme from this week’s get together and the success of the day has prompted me to put ‘finger to typepad’ and comment in this way. The contact and support that flow through these days mean that they become a seminal part of being a Franchisee. This, I believe is one of the major reasons that Franchising offers such a popular route to business success. Every Franchisee appreciated just how important it was for their colleagues to purchase a Franchise and respect is automatically granted. This is then shown through the discussions and ideas that flow through the day. They need to be seen to be understood, but I have never witnessed a similar scenario in any other type of Business meeting and I have attended many conferences and seminars over the years.

Property Portals

We had two portals represented on the day and both offer a different view to the market place. Gumtree only offer the Lettings Market on their site and are therefore important both as a lettings portal and by the way in which they attract the best type of prospective Tenant, whilst Rightmove as the market leader are a site that any self-respecting Letting Agent has to be seen on! As a result of the presentations, all of our offices now understand the options and services each portal offer, for as a punter you would only see the front end of the sites, whereas as a customer, there is a whole sea of reports and functionality available to us to help us understand where and why our prospective Landlords and Tenants visit us. The problem being just how difficult it is for everybody to understand the nature and power of the services these functions provide. It is safe to say that this style of day ensured that everybody left with much enhanced knowledge and will now utilise the functions to their benefit.

Landlord Insurance

Specialist Insurance is something that I have spoken about and something I recommend all Landlords to use, but again, following a procedure that has lasted a full 18 months and as a result of a Rental Industry  supplier that has listened to what we have told them and offices that have taken on board what their peers have recommended (length of service and experience being paramount) we now have a situation where the whole group is moving forward in an innovative way, using this crucial Landlord requirement.

The future.                                                                                                                 

Add the specialist software designed to ensure we make the most from website visitors that we discussed and the meeting was heralded by all to be a great day and this is the point. Only with Franchising are such progressive steps made so easily, because of the willingness from all present to share, assist and develop everybody’s business, not just their own. It is in the interest of every Franchisee to see progress for all offices in the network and there, in finishing this article, is that word again:

 Network: only truly available through Franchising!

03May 2011

Franchise News: 5 Good Reasons to Choose a Franchise Opportunity

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By Joel Caws

Selecting a franchise business as a route to starting up a business can be a great choice. Like anything, there will always be two sides to the coin, but lets look at five important characteristics that a franchise can offer in contrast to a non-franchised business venture:-

1. The Franchise Business Formula

The heart of any franchise business is its franchise formula. This is primarily comprised of the business structures and processes that make the business happen and that make it a potentially profitable venture. These elements make up a core part of the franchise manual that becomes a new franchisees ‘bible’ to read and follow, in order to reproduce the achievement of the original franchise pilot businesses.

2. Proven Track Record

The good thing about a franchise is that you can often talk to other aspiring business people, just like yourself, who are already running the franchise opportunity you are considering as a business. The franchisor will usually be able to provide a list of franchisees that they are happy for you to contact which can act as references for the franchise venture. It can give you extra peace of mind to speak to people who have already travelled the road you are on and have already taken on, and are actually running day-by-day, the franchise business.

3. Training & Support

Unlike starting up business by yourself, franchise opportunities are usually provided with a level of training and on-going support. This is to enable you to run the business effectively and successfully by understanding the franchise formula and how to apply it to the day-to-day business activities.

4. Financing

The majority of high street banks have franchise sections that specialise in funding franchise business start-ups. You will still need to prepare your business plan, but having the weight of a franchise system behind you can give the bank some extra assurance that you are working with an already established and proven business concept. This may give you an edge in getting any funding you might need.

5. Franchise Association Support

There is plenty of help and support offered to those considering franchising as a route to starting a business. In the UK, the British Franchise Association (bfa) is an organisation of which many franchise businesses are members.  The Association helps to promote ethical franchising in the UK and it can therefore give some extra peace of mind if the franchise system you select is a member. Additionally, the bfa can be a resource for any other help you might need such as pointing you in the right direction for professional support such as for legal and financial issues. Other countries have similar franchise organisations in place to hope promote franchising in their respective countries.

Finally, its worth bearing in mind that, a franchise is a business like any other. A willingness to work hard, be determined and dedicated to the franchise system, are all essential to give you the best possible chance of success. A franchise in itself is no guarantee of success, but it does give you the chance to get out of the starting blocks running.

04Apr 2011

Franchise News: A Franchise business as an investment choice

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By Joel Caws

Investing money into a new venture can be a good way of putting extra capital to work in order to make a profit. There are plenty of ways to invest capital from merely putting it in a high interest bank account or investing it into a business opportunity.

Generally, the more riskier the investment the bigger the pay back or loss. When you place an investment into a savings bank account you’re confident your capital is going to be safe, on the other hand the gain you will get from the invested capital is often low. It’s also associated directly to the interest rates at that time, hence if interest rates go down, the benefit from your investment may also be reduced.

Many people choose to make an investment into the stock market which can be an activity that carries much higher risk. The profits can be high for those who have taken the time to know the reasoning behind the way stocks and shares move, however for people who are uninitiated it could be a fast way to lose your money.

Property is another recognised investment preference having a pretty sturdy track record. Although property markets can go up and down in the short term, they have a tendency to rise gradually in the long term. As a result many investors put funds in property because they want to see a positive benefit in the future.

Investing capital into a business venture is a well-liked option. You will find a few methods to do this by means of either starting a new enterprise or looking for an established one that is already operating.

Opting for a franchise may improve the success rate further because a franchise business relies on a proven franchise formula. Quite a number of franchise business opportunities can be run as management franchises which are perfect for individuals who wish to put capital into a business venture but not be hampered with the actual every day running of the business. By employing staff to operate the franchise business, it is possible to manage the business without getting your hands soiled.

There are also franchise resales which are franchise businesses which have already been setup and have been trading for some time. Deciding on a franchise resale may help to further lower risk as you will benefit from a business history to look at prior to deciding to put your cash into it.

No investment is completely devoid of some risk, nevertheless a franchise system provides the extra support of a tried and tested business formula along with training and support. Generally speaking, the success rate of a franchise is good with nine out of ten franchisees each year turning a profit according to Natwest/BFA annual franchise industry surveys. Whether or not you choose to put money into a franchise opportunity or some other business venture, one point is for sure: the success of the business (and the return on your initial investment) will likely be measured by your commitment, hard work and dedication. If you don’t use a strong-minded and disciplined approach, any venture will most likely be doomed to fail.

01Apr 2011

Franchise News: Advertising against Google? A closer look.

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By Steve Roulstone

More often than not, I receive several requests to advertise in either the National press or a periodical associated with the Franchising Industry every week. Nothing new there! Indeed I take my hat off to the people charged with selling the advertising space for their continued persistence and enthusiasm for the task at hand.

How do they send the message?

But it has been very noticeable of late, that I am receiving less and less phone calls and more and more requests via e-mail. Not only that but we receive about an equal split between those who use a full page style of e-mail representative of a page from a magazine and those who send a personalised e-mail, no doubt designed to encourage the recipient to feel more at ease with the sender!

Bit of a contradiction!

I do not know if I am the only person to spot this, but what I perceive as a more concentrated effort to be successful, probably driven by the downturn in the Franchise market place, which we all know is out there, is pandering to its major competitor by utilising one of its most successful styles of communication introduced by the web, namely e-mail to get the message across, about the type of media, they wish to get the message across about, namely the written word!

They are not alone.

I think for the Lettings market to which my Franchise belongs, the clearest indication that web activity is more important than papers or magazine presence, is that nearly all local newspapers that derive an income from advertising property, for sale or for rent, are now running their own web site to ensure the income is not lost. Says it all really!

First page presence.

If I am bombarded by those wishing me to spend my hard earned income through the written word, I am equally bombarded by just as many (thankfully ALL by e-mail!) trying to do the same through web site optimisation. Now I think I made the correct decision on this front some time ago and the work undertaken by the Company I employ has ensured we are where we want to be (or getting their – if it were only that easy!) on page one of the most relevant searches, but let me ask you a question – what is the first page you open when on the internet? How many said Google?

First to be first!

This is one of those situations where the preacher preaches the gospel yet is already converted. There is no doubt that web presence and by that we all know I mean on Google is the Holy Grail (and if it is not it soon will be) for all advertisers. But how good that the very method by which we wish to achieve this presence is by a country mile, the most commonly used ‘first page’ we seek when starting our own regular thirst for knowledge. A case of proof being not just in the pudding, but in the starter, main course and coffee and biscuits as well!

02Mar 2011

Franchise News: Why choose a Property Franchise NOW!

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By Steve Roulstone

Last year I wrote a Blog about why somebody should choose a Property Franchise when looking for a new future in Franchising. This week some figures have been released as a result of the Communities and Local Government English Housing Survey for 2009-2010, which confirm if ever there was a right time, that time is now!

Increase in Rental properties.

The figures released based upon a survey of a total of 21.5 million properties in England, has shown what can only be described as a mammoth increase in the Private Rental sector over the preceding twelve months, which even outstripped the increase at the start of the housing sales slump in 2008 of 1.2%. This time the increase is 1.4% and this is confirmed by recent news items, suggesting that demand could see this increase outstripped during this current year. Indeed figures are being discussed which would give another record increase approaching an additional 2% possible this (current trading) year.

Steady growth.

The overall percentage in the private rental sector as shown in this survey is now 15.6% (Current figures being discussed are 17%) with the social rental sector now falling to 17%, it clearly looks as if private rented property could overtake the social sector to become the largest sector, within the next twelve months. In big round numbers, this is an increase of nearly 300,000 properties in one year, which is all additional potential business for Letting Agents, at a time when more and more self managed Landlords are also turning to the Industry.

Effect on local markets.

So how does this affect local markets, well let’s look at Birmingham, who confirmed 420000 properties within the City Council boundary paying Council Tax last year. 1.4% growth would represent a potential of up to 6000 additional properties, which, at £1000 average earnings per year as a conservative estimate, would produce potentially £6 million pounds additional turnover for the area. Even in a quarter of the City, £1.5 million additional turnover, should encourage anybody able to make a start in Franchising, that the market is buoyant and still growing.

Continued growth.

But it is not just the current growth which is encouraging, for the market has shown growth of over half of one percent year on year for the last decade. What is happening now is a clear sign that this growth is constant and growing. The icing on the cake for Letting Agencies is that the number of potential Tenants continues to grow. This has also been widely reported in the press, and again in a period after this latest survey. So never has there been a better time to become a Letting Agent so you will have to excuse me, whilst I go and make sure there is a clear path to my door!!

10Nov 2010

Franchise News: Property Letting Agents set to boom.

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By Steve Roulstone

And that is not just my opinion, indeed it is not just the evidence of my own Franchise office in Stafford, but more and more people are agreeing that the demand for rental property is growing quarter on quarter. From my standpoint as a Franchisor this is of course good news, especially for our network of offices, but also because of the large number of entrepreneurs looking to become Letting Agents, that we are currently interviewing as a result of the National Franchise Exhibition in October.

Buy to Let Mortgages.

But of course this is not the whole picture, because the large number of Tenants need a large number of houses to live in and at the moment, whilst I am confident there are a large number of Landlords looking for the opportunity to buy, the vehicle they require, is not yet readily available. Those who are closest to the situation, will be aware that some Building Societies appear to be ‘testing the water’ with offers that are only available for a short space of time. The reasons for this could be many, but I would surmise that two very good reasons are initially to see what interest such offers attract and secondly to see what reaction there is from the industry and regulatory bodies to any easing of cash availability in the mortgage market.

Market forces will dictate.

Certainly, one offer drew such interest, that it became impossible for the brokers to action all requests in time, before the offer was withdrawn. This of course confirms that where there is a demand, the market will provide. The natural outcome, as our offices confirm, is that Landlords are keen to buy, but only when the market shows confidence, the available deals are consistent (Nobody wants to buy when better offers are just around the corner!) and property prices become stable.

Reporting good news.

So hopefully and sometimes I have my doubts, the media will start to print, confirm or just talk about the positive things happening in the rental sector and stop making headlines out of property prices, especially  when historically they have always shown a decline at this time of year! In October, even when one agency confirmed an increase month on month, it did not achieve the status of the report from a differing agency the week before that house prices had fallen ‘Yet again’ as the report gleefully confirmed!

 UK Letting Agents will prosper.

But the facts are that during all of this time of property uncertainty, the Rental sector has prospered and letting Agents in the UK are now set for another increase in business as the economy recovers and the increase in rental property continues across the UK. I believe that trading over the next decade could be as good as it was at the beginning of the last decade as we enter a period of sustained growth. This is of course, all good news for those looking to join our ranks as franchised Professional letting Agents!

29Oct 2010

Franchise exhibition observations

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By Nick Strong, Franweb.

It was fascinating for all that attended the national franchise exhibition this year to see how the economic conditions we are going through are affecting the community.

Far from being negative the mood of franchisors on their stands and delegate visitors considering business format franchising as their future was brisk and buoyant.

Steve Roulstone, MD of Castle Estates, commented, “The show has been very busy as has our stand.  We have noticed for the first time an increased number of would be franchisees aged thirty years old and under.  We are excited about the focus and quality of visitor and have already set up some very promising meetings”.

Other franchisor exhibitors I spoke to echoed much of what Steve Roulstone had to say. 

The increase in activity at the national franchise exhibition in both exhibitors and visitors is also reflected on line.  Fro my own business www.SelectYourFranchise.com we have seen a huge increase in buyer visits to our websites and a steady increase of franchisor advertisers in recent months. In fact, buyer visitors to our websites in September 2010 increase by 50% compared to the same month in 2009 and more leads were generated than in any September going back to 2006.

 The economy may be flat but franchise business certainly is not.  The franchise department leaders of the banks have made it clear that they have money to lend to well qualified franchisees and suitable franchisors. Clearly every franchisor should select suitable franchisees carefully and every franchise buyer should go through personal and franchise system due diligence before entering into contract, training and trading.

 It is great to see a go ahead attitude and the franchise community is clearly demonstrating this.  Franchise community leads are cautiously optimistic about the future.  The key is to work hard, follow the proven system and work together for the common good.  This is good franchising.

 

29Oct 2010

Franchise News: Franchising successes

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By Kendall Braddock HSBC Franchising Department

Out with a Bang

As the year draws to a close we look at how the UK franchising sector fared during 2010. Now the nights are drawing in and bonfire night is just round the corner – a sure sign that the end of the year isn’t far away.  I thought I would reflect on how the UK franchising sector has fared during 2010.

Hard Times?

There is no denying that 2010 has been a difficult year for UK businesses.  The economic recession forced sweeping changes in strategy for many businesses, add to this the uncertainty of a general election, increased unemployment and reported lack of available credit and it’s not surprising many firms have struggled. However, franchising has remained fairly resilient during these difficult times.  This is mainly due to the wide spectrum of industries covered by franchised businesses, the strength of the business model and the support provided by franchisors and other franchisees within the same networks. 

Evidence of Hard work

Nowhere is this success more evident than this year’s bfa HSBC Franchisee of the Year Awards.  Financial stability and growth, innovation, creativity and the relentless pursuit of success were just a few traits demonstrated by this year’s finalists.   The overall winner, Gerald Thompson of McDonalds showed that the key to his success is building a relationship with his local community. 

Achieving results

Despite being part of a global corporation, he has successfully created local restaurants for local communities through his involvement with a number of local youth football teams, contributing to local prison programmes and proactively engaging with young people with activities such as a Midnight Basketball Initiative. This is just one example of the strength of franchising and HSBC has seen this repeated many times during the years we have been involved with the sector.

21Oct 2010

Franchise News: Franchising appealing to younger entrepreneurs.

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By Steve Roulstone

I have been attending the National Franchise Exhibition for several years now and there is no doubt in my mind that the age of those attending is dropping year by year, with for me, a definable difference this time around. I have already commented in these posts that the quality of attendee was very high this year and therefore having spoken to many people between twenty and thirty years of age, it confirms that the younger entrepreneur is no different in researching the potential offered by Franchising than anybody else.

Recognition for the Industry.

I have searched the internet for proof of my beliefs through the written word or quoted statistics, but can find nothing to back up my feeling, but for me, being convinced through what I experienced myself, it looks as if the facts behind the ability for Franchising to offer such a higher success rate for new Business is beginning to be seen and hopefully appreciated by a younger market.  

New Initiatives?

And with new initiatives supporting  the Industry due to be announced  in November as well, although as yet the context and content is not known, good support schemes can only legitimise the Franchising route to being the owner of your own Company for a wider market of would be entrepreneurs.

Age should be no barrier.

It is of course just as important for us to treat everybody in the same way when as Franchisors we look at the attributes of every applicant we see, regardless of age or any other definable characteristic. But experience has to be taken in too account and without being ageist, I will continue to consider the individual qualities of every potential Franchisee I meet. It would be a tough call if like the X Factor, I had to recommend to somebody that they ‘Came back next year’ or something similar but because Franchising is very much a two way street, I would continue to take this approach with everybody who approaches us.

Franchising will be the benefactor.

But normal evaluation aside, I firmly believe that a younger more dynamic age group seriously considering our market place has got to be good for the whole industry. Whatever sector is considered, a drop in the average age of Franchisees has got to be welcomed.