October/November 2020 - Bay of Plenty Business News

October/November 2020 BAY OF PLENTY BUSINESS NEWS 19
Rise of the Franchisee Entrepreneur
I remember my year 11 economics class and the subject of
entrepreneurship; it was described as being “hard to define and
even harder to encourage”. It sounded elusive and counter to the
field of economics where we generally like to be able to define our
parameters for everything we study.
How do we define entrepreneurship
and what
is its relationship with
franchising? Let’s start with
returning to the definition. It
turns out my year 11 class was
not wrong. Wikipedia allocates
nearly 250 words to a definition
which includes:
• Entrepreneurship is the creation
or extraction of value.
• Entrepreneurship is the process
of designing, launching
and running a new business,
often a small business.
• Entrepreneurship is the capacity
and willingness to
develop, organise and manage
a business venture along
with any of its risks to make
a profit.
• The people who create these
businesses are often referred
to as entrepreneurs.
I am going to summarise
and define entrepreneurship as
a willingness to, or process of
taking on commercial risk, developing
and managing a business
with a view of creating
value, profit or return.
The misperception
that franchising stifles
entrepreneurship
We have conversations every
day with people who want to
start and grow their own businesses.
They want to take a
measured risk, invest time
and money with a view of
controlling their future and of
course, make a return. Without
perhaps saying it themselves,
they want to be entrepreneurs.
Those that have already decided
that franchising is their
route we call franchisee entrepreneurs.
The statistics overwhelmingly
demonstrate franchisee
entrepreneurs are more
successful.
Some budding entrepreneurs
however have a misconception
that franchising
will stifle their entrepreneurial
aspirations. I believe this
could not be further from the
truth, and invariably we have
a discussion around recurring
themes:
I want to own my own
business, not someone
else’s
Nearly every franchise brochure
or explanation that I
have seen over 20 years starts
with something similar to “be
in business for yourself, not
by yourself”. This is true,
franchisees find – whether directly
or through borrowings
the business themselves, and
the risks and rewards sit solely
with the business owner, the
franchisee entrepreneur. It is
their business - it is not an outlet
or subbranch of the franchisor’s
business.
I want something I can
develop, control and
influence
That is not solely, but it is ultimately
in the hands of the franchisee
entrepreneur. If it is a
start-up or greenfield franchise
business, they obviously need
to develop and grow the business.
If buying an established
franchised business, there is
always room to develop, refine
and do better. And the
best part about franchising is it
provides the road map and the
benchmarking against which
success can be measured.
From over 20 years of research
the Franchise Relationship
Institute has established
that one factor accounts of
approximately 40 percent of
the success (or otherwise) of
a franchised business. It is
not the brand, not the location
(though both are critical), it is
the franchisee.
I don’t want to be told
what to sell and I don’t
want to be stifled
Firstly, here is the wake up,
“someone” is going to tell you
FRANCHISING
> BY NATHAN BONNEY
Nathan Bonney is a director of Iridium Partners. He can be
reached at nathan@iridium.net.nz or 0275-393-022
what you should be selling.
That “someone” is the “market”
– if the market does not
want it, you won’t sell it. And
why would you not want the
collective experience, support
and guidance of a franchise
system to assist you with what
you should be selling?
We also often hear people
say they don’t want their ideas
or innovation stifled. Good
franchise systems do not stifle
innovation, they have the ability
to develop, test and roll out
innovation, often generated
by franchisees. Need we say
more than Big Mac – invented
by a franchisee, now the greatest
selling burger on earth.
I don’t want to follow
rules
Let’s face it, we have rules in
business – we must pay taxes,
we must follow an extraordinary
number of legislative
requirements and we must
perhaps most importantly,
do the things, and follow the
rules that will create profitable
businesses.
Franchise systems develop
processes and parameters,
“rules” because they work.
Some are designed to make
sure the franchisee is able
to stay within the legislative
playing field. Whilst others are
definitely to ensure compliance
within a franchise system.
To quote one of my former
franchisor managing directors:
“The franchise agreement and
parameters are designed to
keep the good things in and the
bad things out.”
There is one statement that
does separate the entrepreneur
from the franchisee entrepreneur
– I want to create or develop
my own “thing”.
These super brave people
are politely called pioneers. I
believe there is often a confusion
between pioneering and
entrepreneurship and while
they are not mutually exclusive,
they are not the same.
You do not need to invent,
or revolutionise anything to
be an entrepreneur. If you
do want to be a pioneer, then
franchising is probably not for
you and we wish you the best
of luck. But remember that
statistically, the franchisee entrepreneur
is more likely to be
successful.
New ways of working for Kiwi
SMEs reveal potential security gaps
ADVERTORIAL
New research by 2degrees has revealed New Zealand’s small business owners
are taking a new approach to work. This comes as Kiwis navigate their way
through an unpredictable year, which has seen the country move in and out of
lockdown in the fight against Covid-19.
The 2degrees Shaping Business
Study, which surveyed
more than 1,000 small and
medium-sized business owners and
decision-makers, found that more
than half (58%) have changed their
approach to work since the Covid-
19 pandemic reached our shores.
The lockdown earlier in the year
thrust many small businesses into
an unknown territory, however the
new research shows that, second
time round, businesses were much
better prepared for the switch to
Levels 3 and 2.
This year has seen one of the
biggest changes to the way we work
since the Industrial Revolution.
With this, has come a significant
shift to a more mobile workforce.
Andrew Fairgray, Chief Business
Officer at 2degrees, says business
owners and decision-makers
have done a great job in establishing
what works best for them
and their people, while grappling
with the challenges of the current
circumstances.
“For some, working from home
permanently is a better option,
others are offering their employees
more mobility around working
hours or rotational days to work
from home – either way it gives
Kiwis reassurance and greater confidence
in knowing they can work
from home when necessary.
“Part of that comes down to having
the right tools to do so, like reliable,
secure mobile and broadband
connections.” says Fairgray.
With an estimated over 60% of
employees in New Zealand now
working from home on a regular
basis, Kiwi businesses need to be
thinking about security more than
ever before.
According to the study, under
half of SME decision makers currently
did not have any current data
security resource. Sole traders were
significantly more likely to state
that they currently have no security
resource in place (46%) compared
to employing businesses (27%).
While there are a variety of different
risks, home broadband security
is believed to be the biggest
online risk for nearly one quarter of
SME decision makers. Nearly onethird
stated they didn’t know what
the biggest online risk was to their
business, highlighting the need for
businesses to really take a good
look at security options when it
comes to their employees working
from home.
So, what should business owners
do? Start simply: identify your
risks and research your options.
Some businesses will be more at
risk than others – those dealing
with sensitive information every
day such as financial services for
example.
A great place to start is with
2degrees Work from Home Fibre –
a secure, Fibre connection to keep
businesses humming seamlessly
when their employees are working
at home. This new product delivers
business grade broadband through a
dedicated Fibre connection to employees’
homes. Work from Home
Fibre does what it says on the tin
– it’s fast and offers the capacity
businesses need.
Plus, web-filtering is part of the
package. So you have the option to
switch on the web-filtering security
add-on – a service that enables you
to block sites known for phishing,
malware and other security threats
to work laptops or computers – for
free, and you can also choose to
block streaming sites.
Upload speeds are up to 5X faster
compared to their home broadband
Standard Fibre 100 Plan – super
important for things like video conferencing.
The 2degrees Shaping
Business Study showed that 40%
of respondents found video conferencing
the most important tool to
stay connected to their team during
lockdown, so making sure it works
well is key when staff are working
at home.
So, give the guys at 2degrees a
call or visit 2degrees.nz/business to
start down the right path to ensuring
your critical business information
is secure even when staff are
working from home.