Franchising during the year of the ox…


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Franchising during the year of the ox

Did you know that the Chinese celebrated their New Year on 26th January and have now entered the Year of the Ox? Truth be told, neither did we until we came across this bit of information on the Internet. ÔÇ£WhatÔÇÖs the relevance?ÔÇØ we hear you ask. Wait, we are coming to that.

According to the article, every year in the Chinese calendar is identified by one of the 12 animals that form the Chinese zodiac. The animal that represents the current year is the ox, and the ox stands for prosperity through hard work. Can you see by now where we are going with that?

Should you be one of those cynics who think that this plain nonsense, think again. Barack Obama was born under the sign of the ox; wouldnÔÇÖt you agree that things have worked out well for him so far?

Of course, you canÔÇÖt just sit back and expect the ox to do all the work for you. This wonÔÇÖt happen. Rather, youÔÇÖll have to take the initiative, work hard and keep your wits about you throughout. Follow these guidelines and, far from being a year of doom and gloom as the pessimists predict, 2009 could turn out to be your best ever.

The year is still young but already, lots of good things have happened to people. Only problem is, we donÔÇÖt generally hear about them. Apparently, reporting on the negatives attracts more viewers or readers. Be this as it may, we refuse to be sucked into this spiral of negativity. WeÔÇÖll report on some positive developments instead.

Subway expands

While many operators in the UK fast food sector are putting a freeze on expansion or even closing down existing stores, Subway announced plans to establish 600 new stores in the UK and Ireland. This will require an investment of ?ú60 million and create 16 000 jobs.

The US-based chain has already about 1 400 stores in the UK and Ireland, up from 25 stores in 2000. They now expand at an average rate of five new stores a week in this market alone.

In an article we published in our newsletter about a year ago, we criticised Subway for their rate of expansion. It appeared to be excessive and seemed to have caused some franchisee failures. We based our comment on reports from Germany and New Zealand where these failures occurred. It appears that SubwayÔÇÖs management have learned their lesson and have put systems in place that go a long way towards ensuring that their franchisees are successful. We wish to applaud them for that!

Vida e Caffe

Subway arenÔÇÖt the only company that aims to tackle the UK market with a countercyclical strategy. South African coffee shop operator Vida e Caffe will open its first store in LondonÔÇÖs Bond Street during March. Everyone who is vaguely familiar with the London real estate scene will know that Bond street is an upmarket area, with rentals to match. However, Vida e Caffe director Shaun Bond is convinced that they can pull it off. He makes the point that although LondonersÔÇÖ are somewhat cash-strapped at present, they continue to spend money on lifeÔÇÖs little luxuries. He plans to beat Starbucks on vibe and price and is planning the opening of a second store even before the first one has commenced operations. We wish him luck!

Pick n Pay

Did you know that closer to home, Pick n Pay have just pulled off a coup of a different kind? You probably didnÔÇÖt because in spite of the magnitude of their achievement, it didnÔÇÖt feature strongly in the media. This confirms our contention that good news are largely ignored.

What happened was that Pick n Pay tested their mettle against the worldÔÇÖs leading brands. They entered the award for the WorldÔÇÖs Best Retailer and won! The award was presented at the National Retail FederationÔÇÖs annual convention and expo in New York from 12-14 January 2009, and we wish to congratulate CEO Nick Badminton and his team for a job well done.

Incidentally, Pick n Pay arenÔÇÖt just great retailers, they are great franchisors as well, and firm believers in expansion through franchising. In South Africa, they operate the Pick n Pay Family Stores under franchise and in Australia, they acquired the loss-making Franklin chain and turned it into a profitable entity through franchising.

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