COVER STORY

Forging ahead

The freight and logistics industry is booming, and InXpress, the FCA International Franchisor of the Year 2021, is wellplaced to take advantage of the increased demand.

Marcel Lal joined InXpress in 2018 as country GM for Australia and New Zealand, before taking on the role of CEO Asia-Pacific in May 2019.

In October 2021 the business was awarded by the Franchise Council of Australia for its international focus. “The awards are really important to give a business like ours additional credibility. We’re not a traditional business you can touch and feel. Ours is under the radar, it takes more time to understand.

“The award has been helpful in our marketing, it validates what we are doing with an investment-led mindset,” says Marcel. “The results are there to support that we’re heading in the right direction.”

Operating in the business-to-business marketplace, InXpress provides a shipping solutions platform, with a single point of contact and one invoice, no matter how complex the shipping job.

The vast majority of clients (90 percent) are small and medium enterprises (SMEs), who value the service, advice and automated platform that InXpress provides.

“We’ve made life easier for them, in time and costs,” says Marcel. “During Covid, without the same level of face-to-face interaction, SMEs in Australia generally really value service-based industry, comfort and advice,” he says.

Navigating the challenges of the Covid-19 pandemic has served to show how resilient the InXpress business can be.

“It’s about constantly looking back at results, looking at what you need to do in resources for support but continuing to look into the future. That is really important, it’s easy to just focus on the here and now,” he says.

There’s been the challenge of finding capacity in an overstretched courier market and against the background of external domestic strikes.

Marcel’s solution has been to focus on these problems but with an eye to the future, to resource up and spend money on staff, increasing corporate staff by 50 percent, to get ahead.

“Now we have a really experienced team in place across Asia-Pacific. As we stand right now, in Australia we’ll finish the year with revenue growth of 40 percent; in New Zealand, which is a much smaller market, it will be more than 100 percent,” he says.

Marcel is projecting a similar increase for 2022, about 30 to 40 percent, and a minimum 30 percent growth year on year for the next five years.

“We take our management fees based on margin not revenue, we’ve got skin in the game. It’s about profitable revenue growth. That’s why we’re investing so heavily.”

InXpress has 55 franchisees in Australia, with some consolidation of existing franchises, and there are more joining.

“It’s been good to see that level of growth – it’s certainly justified the increased spend and resourcing and system enhancements that provide more services for franchisees to sell.”

Business resilience is also built around communications, the process of testing ideas and garnering feedback from franchisees, monthly country calls, virtual sessions and various other engagement points, says Marcel.

“We revamped our processes to provide much more individual and group communication and that has built resilience among franchisees too.”

E-commerce has boomed but successful businesses can’t rely just on technology – they need to have people on the other end of the phone.

Investing in staff and technology is crucial.

A good franchisee support centre ensures franchisees can in turn support their customers, and InXpress operates with a very high ratio of staff to franchisees: one support staff member to three franchisees, as an overall rule.

Encouraging a good gender mix

Marcel is also a big advocate for encouraging women in the logistics industry.

“I’m approaching three years in the CEO role, and in the last 12 months we have more women in the network and in staff across Asia-Pacific.”

About 60 percent of the staff is female, a particularly high proportion for the freight and logistics industry. Some of the female staff are mums coming back into the workforce. 

BEDDOWN INITIATIVE

InXpress is a freight partner for the homelessness charity Beddown, which repurposes vacant spaces into pop-up accommodation.

Staff, franchisees and business customers also engage in fundraising, donating money or their time to the cause.

As a system-wide initiative, there’s a network-wide focus from conference attendees putting pen to paper to provide handwritten cards for the homeless, to individual franchisee events.

“And six out of 11 of my direct reports are women,” adds Marcel. “I believe in employing the right person for the job, so I don’t pigeonhole people, it’s important to look for opportunities for people.”

To action this requires getting multiple men and women involved in the hiring decisions.

“Even if the role doesn’t relate to their area, there are aspects that could fit. We have an energetic, fun, ambitious and forward-thinking workspace. The team is aware of what to look for.”

It’s also important to refrain from being too prescriptive in the recruitment process, with the questions asked, and with the job ads.

“A business coach may have the skill sets but not done the role before,” says Marcel.

“We have a global women’s seminar, where all staff and franchisees are female.”

It’s about developing female managers, gaining international certification for franchising, attending the International Franchise Association’s annual event, to create the next wave of female leaders.

Traditionally it has been men who have shown most interest in buying an InXpress franchise.

“However, once they realise this is not a traditional freight business with a truck, that it is tech-enabled, a number bring in their partner to be involved. Some women come in direct.”

The challenges ahead

Challenges are ongoing in the new world, says Marcel, from freight capacity challenges – road freight, air freight capacity, less airline space, strikes – to contingency and future planning based on technology.

The key is providing a seamless service for customers, he says. InXpress ensures that if there’s a problem with one carrier, a customer can have an alternative carrier provided to avoid any business disruptions.

“It’s about what we’re doing to counter the challenges,” he says. “Franchisees are working in business-to-business, and face-to-face engagement is crucial. And that is why InXpress has an 80 percent customer retention rate, there is regular engagement with the local franchisee.

“During Covid we did a lot to help franchisees’ communication skills on the phone, online, video, to make sure we are providing a personalised service.” 

New recruits

A dynamic year ahead, new branding and happy franchisees – 2022 is lining up well for Frontline Recruitment Group.

“W e've had a major success in franchise sentiment, the Net Promotor Score increasing by 36 points in July,” reports an enthusiastic Arthur McColl, CEO of Frontline Recruitment Group (FRG).

“We’ve been perfecting the business models, gained the trust of franchisees and increased profitability.”

In early 2020 the group was purchased by US firm Express Employment Professionals.

In addition to a substantial support system and resources, FRG now has a sibling business focused on flexible staffing, with the US model tweaked and introduced to the Australian market in 2021.

It’s been a whirlwind couple of years with new owners and the challenges of Covid thrown in.

So looking ahead to a new year and a newlyminted brand is exciting for the FRG team.

“We relaunched FRG in January as a new, vibrant brand and a working group of six franchisees has been heavily involved,” reveals Arthur.

Creating working groups in marketing and IT/ data has been one solution to franchisee requests for more collaboration.

“This is a 26-year-old brand, so we listened to the network, undertook an engagement survey and they said the brand was dated. So we went to the US [head office] for a budget.”

FRG’s chief marketing officer, Michelle Gamble, believes the timing is perfect, one year into acquisition and post-lockdowns.

“Attracting consultants drives our growth, so we need the brand to be modernised,” she says. “Lots of our business is female focused and our brand is quite masculine. It needs to reflect what we are today, the diversity of the client bases, a more sophisticated business, it needs a human element.”

FRG operates within a number of industries, where franchisees draw on their personal industry experiences to operate their own small business in their chosen sector: retail, hospitality, construction, health, education, and IT and digital industries.

Today FRG has 80,000 clients and 1.2 million candidates on its database, which franchisees can tap into. The business model provides business systems, training, budgeting and financial analysis so franchisees are set up for success from the start.

Arthur says three new agencies came on board with the Express brand last year – one corporate, one a conversion from an FRG agency, one in New Zealand – and with strong performances overall in the final few months of 2021 the company is set to expand on its success. 

FRANCHISEE TESTIMONIALS

Pia O'Neill

Frontline Hospitality Queensland, South Australia & Northern Territory

When business took a dive during Covid, within a week Pia’s business was closed. However, despite juggling all the challenges of the pandemic, a new baby and a new franchisor, she reports that now business has never been better!

Pia has been with FRG 16 years, starting as a parttime receptionist for a franchisee. She purchased her first store at 26 in Brisbane and then formed the Queensland Hospitality division, added in North Queensland, and five years ago ventured into the Northern Territory and South Australia.

The hospitality sector has been badly hit by the pandemic, she admits.

“Covid was really harsh. My business closed down in a week and we were closed for five months.

“We’ve pulled back operations so for now we are just based out of Brisbane. We are still operational interstate but not on the ground.

“On the recruiting front we had people who went home, who left the industry – it was heavily affected, people changed careers. It’s been really hard.

“Having said that, we’re the busiest we’ve ever been! As a business we only focus on permanent roles at management level and there’s a very big shortage of chefs.”

Pia says the new franchisor has made a difference to the business.

“FRG was bought out at the start of Covid. It was a very wild, nerve-wracking time. But it was a very smooth transition, there were lots of people involved talking to us.

“I knew it was a good business beforehand and I loved the previous owners so it was very daunting.

“The level of communications was great, we had operators in Express making contact, and our CEO Arthur was quick to come out and meet us.”

New departments including learning and development have been introduced.

“We’ve got so many more tools, you can see they are investing a lot in the business to help us perform at our best.

“We have good supply rates now because we’re so much bigger, there’s a network of support with other agency owners, and everyone is very motivated.

“It’s busier than ever. It’s been a big journey.”

Graham Howard

Frontline Health and Frontline Education Queensland

Reflecting on the company’s acquisition in 2020, Graham has nothing but praise for the process and the new owners. “The old owners ran this for 25 years so it’s been different. I like to think of it as

‘we’ve had a fantastic house but now we’ve got solar, modern furnishings, it’s even better’.

“And having been in corporate I’ve never seen a changeover better handled.”

Graham first got involved with FRG as an executive looking for retail staff, and he loved the business model.

“It sowed a seed, it grew. It’s white collar, Monday to Friday, dealing with people, so I explored what was available.”

Graham has a background in health and, along with the Sydney franchisee, was the first to operate in this sector.

“I had no clients and no candidates. Systems and processes don’t mean a thing when you haven’t got anyone to talk to. When I look back, it was incredibly daunting, where do you start?

“Health is a behemoth so which sector do you go after? I started with the jobs supplement, and once I’d found the jobs I got in touch with the recruiter and put the jobs on our jobs board. Then I started to build up a database.

“The key to success in our business is the people we employ. If we don’t have the right people, it’s incredibly hard for anyone and a huge drain on finances if you get it wrong.

“The best part about our business, and the worst part about our business, is you’re dealing with people. You have to sell the job to the candidate, then sell the candidate to the business.

“You have to market yourself. While it has aspects of HR, first and foremost it’s a sales and marketing role.”

Over the years Graham and his business partner (who runs the education agency) have made friends with other agency owners.

“The greatest advantage to me has been the networking, sounding out ideas, best practice, sharing information, genuinely supporting each other. We’ve all been on a rollercoaster from the day we started.

“It’s our colleagues that rally around.

“I love my team, what I do, coming to work. In the next 12 to 24 months I’d love to step back a bit but I don’t see myself managing myself out of the business.” 