One of my rather peculiar habits is watching old adverts.
And while the reason why is a story for another day, I stumbled across an ad that reminded me why franchises (especially in our industry) are something I wouldn’t personally recommend.
This is off the back of UFC Australia going arse over tit and entering voluntary administration last month after leaving their franchisees high and dry with enough unrealised promises to knock you senseless…
Add this to the growing list of fitness franchise failures, and you start to see a pattern.
I thought you’d like the lesson, too, so here goes:
So earlier this evening, as I watched old ads, one from Midas (the car repair company) stopped me and reminded me why I’d always warn a prospective franchise owner to tread carefully.
It starts off with a golden talking hand approaching some dishevelled guy in his home (presumably representing someone poor), asking the guy why his car isn’t in the driveway.
The guy says it’s at the mechanics, but he doesn’t know when he’ll get it back because it’s costing him an ‘arm and a leg.’
So, this talking hand says something like this:
“Damn, should have gone to Midas. We would have told you what you can get away with leaving till next time, so it costs you less.”
The guy responds: “Yeah, I’ll go to Midas next time,” and they hi-5.
Now, the ad seems harmless at first…
But it’s not.
Because it’s a case in point of why many franchises end up selling you something completely different from what’s on the marketing brochure.
The funniest thing about this ad is that some rookie in corporate probably thought this was a great marketing idea.
But before you agree, take a second to imagine being a franchise owner and seeing this launch for the first time.
Every whinger, tyre-kicker and cheap skate would be turning up to Midas wanting to repair their car for pennies on the dollar.
And while they may no longer have a leads problem (some would say the marketers have done their job), they’ll be attracting the type of customer that wants to wring the franchise owner dry of every last cent of operating profit.
Which is a quick way to race to the bottom.
A problem for which the franchise owner would have had no recourse for doing anything about.
And it’s for that reason that I would never invest in a franchise or turn AA into one.
Because behind all the marketing assets franchisors use to put mayonnaise on the business model, franchises typically defy a fundamental business principle that I’ve had to exploit the last month and a half.
And that principle is adaptability.
When you operate a franchise, you have little to none of it.
Instead of being able to flex to changing business conditions, franchisees are often at the mercy of their franchisor overlords… and that’s not a game I would want to play.
Because with the business seasons so temperamental at the moment (we’ve personally gone through a tonne of change, which is why I’ve been quiet on the email front), the last thing I’d want is to be a puppet of some moron at the head office running some marketing campaign that attracts the wrong type of customers… to no ones detriment except my own.
And in times like this, I’m bloody grateful that the only person who is responsible for my own success or failure… is myself.
Take from that what you will.
– Karl Goodman
