Stronger together

Simon Lord explains how New Zealand’s business franchisees found support paid off during lockdown.

The recent Delta outbreak, and Auckland’s extended time in Level 4 as the country rushed to achieve higher vaccination levels, saw small businesses suffering once more. Although some subsidies were available, higher thresholds meant many businesses which qualified for support in 2020 didn’t receive the same benefits this time.

Yet a survey of over 100 franchisees conducted by the V.I.P. Home Services franchise after the national lockdown began showed that only 16 percent of franchisees rated themselves as anxious, despite being unable to work at all. Ninety-seven percent felt no need of emotional support, which was something V.I.P. offered last time through a variety of means, and 89 percent felt no need of help with accessing Government subsidies.

Given that around one tenth of the franchisees surveyed were new since the previous lockdown, the results make impressive reading.

It’s not just this one franchise, either. Many franchisors reported that, despite the total disruption caused by alert level changes, their franchisees were less worried than last time. This was supported by psychologist Greg Nathan of the Franchise Relationships Institute, which surveyed over 2,500 franchisees in Australia, New Zealand and the US.

“My estimate is that 40 percent of small business owners are seriously stressed,” said Greg. “But the figures are significantly better for franchisees, where over 80 percent report that they are functioning well, or are slightly stressed but functioning normally despite repeated lockdowns. “Independent owners are struggling because they don’t have the business and social support that good franchise networks provide. Franchisees feel part of a wider group, part of a team, and that can be very reassuring – they know someone has got their back.”

So what does this support look like? Here are a few key reasons why franchisees have been less stressed.

Properly prepared. When a franchisee first opens or takes over their new business, they have been selected for their ability to run it, given systems to operate it, and trained in those systems to maximise its potential. They aren’t just working with an idea, or having to find solutions as they go along.

Buying power. A sizeable franchise can negotiate good bulk-buying arrangements not only on product but on services such as insurance, IT, fuel and banking. Not only does that increase profitability, but buying power can also secure supply or help negotiate better terms in uncertain times.

Benchmarking. Having access to key statistics being achieved by other franchisees running exactly the same business model in areas such as staffing, gross margins, product mix and promotional performance, helps to identify areas for improvement.

Business advice. Visits from field managers and other specialists can help identify opportunities for improvements in sales, service and cost control. Experienced franchisors provide assistance in areas such as goal setting, cash management and exit strategies.

Systems & compliance. Even before the pandemic, ever-tighter compliance regimes were making life tough for the small business owner. Franchisors provide systems and guidance in such areas, and when Covid came along, they were quick to supply everything franchisees needed, from PPE gear to signage to online ordering apps and contactless delivery systems.

Group hugs. Perhaps most of all, franchisees have felt part of a group, with the support and fellowship of the whole franchise team – including other franchisees. They have always been able to talk to people who really do understand, and that makes a big difference. Zoom calls, emails, Facebook and What’s App groups have ensured nobody need feel alone. Some franchises extended support groups to whanau, too, even supplying games for the kids.

Stronger together. Here’s a story that demonstrates the spirit of franchising. With the rise in online shopping during lockdown, Aramex was hard pressed to keep up with demand for its courier services. They reached out to Green Acres, who had a whole team of franchisees unable to work, and the two quickly concocted a package which saw Green Acres-liveried vans delivering parcels on behalf of Aramex.

It was a solution that enabled Green Acres franchisees to stop sitting at home worrying about money – instead, they were able to get out, keep earning and be less stressed.

That sort of creativity, collaboration and support is what franchising is all about.

Simon Lord is publisher of Franchise New Zealand magazine and website. A free copy of the magazine is available from www.franchise.co.nz