Let’s talk: The ups and downs of franchise businesses


franchise businesses

Featured | Let's Talk

By Loren Webb

Franchise businesses, although sharing many qualities with non-franchises, have their own unique ups and downs that come with the relationship of the existing brand and business model. 

There is support and systems in place, which can provide a great growth trajectory, but on the other side of that, it can lack the flexibility that entrepreneurs may want to carve out themselves.

Today we hear from franchise owners on the rollercoaster ride that comes with franchises, taking their advice and opinion on board for anyone considering buying into a franchise or already within one.


Luke Guanlao, COO for Anytime Fitness Asia and Group CEO for Inspire Brands Asia 

Franchising is similar to any business – it has its cycle of ups and downs. Its advantage is in having products, systems, and processes in place that allows any entrepreneur to concentrate on their own operations and profitability and leverage the experience of the master franchisor such as Anytime Fitness Asia for improvement.

Franchised businesses, like most, have an upward trend when it is introduced to a new market or a new location, and continues steadily as business improves and the brand gains recognition. It may however decline as competition enters and disrupts the model.

The key to ensuring stable growth is innovation. This can take many forms, such as introducing new products and services, addressing an unmet consumer need, and creating demand through continuous education and thought leadership in the industry.

By staying ahead of the curve, franchised businesses can sustain their upward trend far longer and adapt much faster than the competition.

Jonathan Moody, CEO and founder of Physio Inq

Owning a franchise is great if you are someone who loves to go out and get things done and know that you have support from head office level. You should have access to incredible marketing, process and administrative tools at your fingertips that have been developed over time, weeding out many of the errors that can only be found through experience. They can also provide incredible places of networking with other franchise business owners. On the flipside, it can be challenging if you wake up one morning and say ‘I want to do things differently!’ That’s because you’re working in a system where change needs to go through a process to make sure it works for all. The upside is that any change that comes is likely to be a good one, because it’s been tested in the network.

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Aaron Smith, Founder,  KX Pilates

Franchise relationships are partnerships: franchisors and franchisees are on the same team, so the better they understand and communicate with one another, the healthier the franchise will be.

Unfortunately, many franchisors focus only on the dollar amount in the sale of a franchise and is known in the industry as ‘transactional franchising.’ Not servicing your franchisees properly is a fast track to creating a disenchanted class of business owners who feel they have been ripped off.

When franchising KX, I decided to centre what was best for the brand. In the fitness industry, all you really have is your reputation and that was a lesson I transferred into the business side. You can spend years building a reputation and it can be ruined in seconds from poor choices, so it was important that our franchisees understood that.

Steve Grossrieder, Chief Executive Officer, JAX Tyres & Auto

Franchisees have played a significant role in the 70 years of the JAX Tyres & Auto business, allowing us to expand and reach out to more customers in different parts around Australia. Our network has over 85 franchisees and counting.

For us, to enumerate the ups of franchise businesses is easy. They are our true partners in growth, developing new markets and leveraging our brand and relationship with Aussie drivers.

The challenge, because we cannot call it a down, is ensuring that we continue developing new training, tools and innovation, such as the adoption of solar power, to make the business profitable, ensure consistent best practice and excellent customer experience.

We’ve even had a new team member take the reins at the JAX Tyres & Auto franchise store in Phillip, ACT as the COVID-19 pandemic took hold, which is a testament to the value that our franchising model can provide.


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