FFC urges overseas franchisors to recruit carefully
“Recruitment of suitable franchisees is the biggest issue currently facing franchisors in Australia,” said Franchised Food Company’s managing director, Mr Stan Gordon.
Overseas franchisors looking to enter the Australian market should be aware of the recruitment struggles they will face according to Franchised Food Company managing director Mr Stan Gordon.
Mr Gordon said blasé comments from American based Kahala Franchising regarding recruitment issues for the Australian expansion of its Cold Stone ice cream chain, could be the first step in becoming a cautionary tale.
Franchised Food Company owns popular food brands including Cold Rock Ice Creamery, Nutshack, Pretzel World and Mr Whippy.
“Recruitment of suitable franchisees is the biggest issue currently facing franchisors in Australia,” he said.
“Any outlet lives and dies on the strength of its operator and tier one franchisees are currently in short supply.
“The last few years have been difficult for several operators in Australia and while the marketplace has room for competition, recruitment should be the key concern, not a secondary thought, of any new entrant.
“Franchisees can’t simply be counter retailers, they need to have a passion for the product, be willing to work hard and have sound knowledge of their local market.
“It’s rare to find operators who hold all those qualities.
Mr Gordon also said overseas brands such as Krispy Kreme, Starbucks and even Baskin Robbins were prime examples of offshore brands that failed to recognise that Australians are very savvy when it comes to their discretionary spending.
“Those brands all enjoyed an initial surge in popularity but ultimately failed to understand the Australian marketplace,” he said.
“Imposing a product or experience that has worked overseas doesn’t necessarily resonate with Australian consumers. Tastes vary and it’s vital to respect that and modify your offering accordingly.
“Australia has a lot smaller population than the U.S. yet our retail market is already brimming with choice.
“Consumers here are very discerning and educated. They will vote with their feet elsewhere if they are taken for granted.”
Mr Gordon said it had taken more than 15 years for Cold Rock to open 100 stores in Australia and the steady growth was down to the recruitment of strong franchisees and an understanding of local conditions.
