Food Franchise Magazine Winter 2015

winter 2015

FoodFranchise Fast food Franchise

QSR Franchise

Coffee franchise

Sandwich franchise

Restaurant Franchise

Pub Franchise

One to Watch Take a look at craft beer specialists Beer Dock and their latest opportunities

Industry Voices

Be Inspired

Four experienced franchisees talk honestly about the choosing and entering the food franchise market

Meet BFA Young Franchisee of the Year Aaron Stewart

Print edition ÂŁ3.99

1 | Food Franchise Winter 2015

Harry Ramsden’s

Franchise survey

A look at the iconic Fish and Chips brand as they embark on a radical relaunch

Take a look at how food franchises are performing in the UK market

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Contents winter

06 News round-up A look at some of the latest developments in the food franchise sector

17 Papa John’s One of the leading pizza franchises tell us about their 2015 incentive scheme

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18 Industry Voices Our experienced franchisees talk honestly about the choosing and entering the food franchise market

26 Harry Ramsden’s A look at the iconic Fish and Chips brand as they embark on a radical relaunch

28 One to Watch

17

Here we take a look at Beer Dock in Crewe and how they plan to roll out the their craft beer franchise

26

18

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43 32 Survey We look how food franchises are performing based on the survey conducted by the NatWest and BFA

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38 Accountancy The experts from McPhersons Chartered Accountants tell us what we should be investing in

40 Market Watch We look at how some of the current food franchise opportunities are performing on the stock market

43 Food Review Trevor Langley takes a look at specialist produce franchise, Cherry Tree

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44 Be Inspired We meet BFA Young Franchisee of the Year Aaron Stewart who runs three Marston’s Pubs

48 B ank of England feature Banknote Education Manager, John Kendall talks to us about the problem of fake currency

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Editor’s message

Welcome back!

Hello and welcome back to Food Franchise - as many of you will know this is the second issue of the UK’s only magazine dedicated to the food franchise industry.

Editor Scott Rumsey scottr@mvhmedia.co.uk Office: +44 (0) 333 003 0499

Editorial contributors Trevor Langley

Commercial Manager Lewis Wantling info@mvhmedia.co.uk Office: +44 (0) 333 003 0499

Advertising sales Sandra Bouillet sandrab@mvhmedia.co.uk Office: +44 (0) 333 003 0499

Finance Laura Williams finance@mvhmedia.co.uk Office: +44 (0) 333 003 0499

Design Simon Warbrook design@mvhmedia.co.uk

The response that the first issue received was fantastic and showed us that there really is a marketplace for this publication. The positivity we received in the office meant that we have had to make some rather significant changes, first of all we have added a further 20 pages of editorial meaning that there are now 52 pages of relevant, informative content for you to get your teeth into.

As well as this new content we have plenty of new features and in-depth interviews with recognised brands within the food franchise industry. The final change is me, Scott Rumsey, joining the team as your new Editor.

In this issue we look at the burning questions any potential franchisees may have in our Q&A feature. The aim of this feature was to ask real people who have taken the chance and opened a franchise, how they did it and why, giving you the best insight possible.

Our second feature looks at the survey conducted by NatWest on behalf of the BFA. In it we look at the rise of food and drink opportunities within the franchise industry and explore whether or not these types of business are performing as strongly as other franchise opportunities.

Your starting point, as always, will be the industry news, where you can read all about the latest developments. As industry news is such a broad area and key part of the magazine you will notice that we have now divided the pages within the section, dedicating some to new openings, franchises serving alcohol and the financial performance of franchises.

We feature a Be Inspired page telling the story of how one franchisee has embraced food franchising and the success that this has given them. We also have a business profile for Beer Dock, one of the UK’s most promising new franchises.

If all this exciting new content wasn’t enough, we also have all of the regular pages such as Trevor Langley’s food review, Ian Dawes’ franchise viewpoint and the Accountancy and Finance pages.

Publisher MVH Media Ltd. Unit 9 Wilkinson Court, Clywedog Road South, Wrexham Industrial Estate, Wrexham LL13 9AE The publishers do not accept responsibility for advertisements appearing in this magazine.

The opinions expressed are not necessarily those of the editor or the publisher.

In early 2015 the team here at Food Franchise Magazine will be attending some of the UK’s biggest franchise exhibitions and will bring you all of the latest news in early March.

Until then, happy reading.

www.foodfranchisemagazine.co.uk @franchise_food /foodfranchisemagazine1 Winter 2015 Food Franchise | 5

News

round-up Esquires Coffee Roll Out Nationwide Rebrand Franchise chain, Esquires Coffee have begun the process of a nationwide rebrand with the first of their 24 redesigned stores opening in Durham.

Situated on Back Silver Street and overlooking the River Wear, the new-look coffee house is home to franchisee Dale Smith and his partner Clare Footes.

Speaking exclusively to Food Franchise, Mr Smith said: “When we looked at getting a franchise we looked at several opportunities and this one stood out, the branding is great and the place looks fantastic.

“This was a place that myself and Clare visited and I have always loved Durham.

To be able to open a coffee house in this area is a great privilege and opportunity.

“The location is perfect, you just can’t buy some of the views we have here and as you can see the community have really embraced it, we’ve been non-stop since we opened.”

The store is the first in the UK to carry the new corporate branding as company owners attempt to position the business as an ‘international premium branded coffee house’.

When asked about the rebrand a spokesperson from Esquires said:

“Our aim is to create a vibrant, friendly environment for our customers to enjoy our 100% organic and Fairtrade coffee.”

This ethos was echoed by Mr Smith who added: “We are hugely passionate about what we do, we want to give back to not only the community but to those who provide us with our coffee.

“Clare and I are planning a few trips around the world to meet the coffee growers, to take photos of them and to share their stories on our coffee sack wall.”

The remaining stores are expected to complete their rebranding over the next 12-18 months and this will pave the way for further business expansion throughout the UK. Esquires also operate in China, the Middle East, Canada and New Zealand

Hammersmith to welcome Tiger Bills Thai-themed, bar and restaurant, Tiger Bills, is continuing to expand their operations, following the opening of a new site in Hammersmith, London.

The restaurant chain which is owned by Lifestyle Hospitality Group, currently operates nine sites across the UK and are looking to continue their growth both here and internationally.

Over the last few years many prospective franchisees have been drawn towards Tiger Bills, who serve a range of Western and Thaifusion food at affordable prices. Their current offering includes nachos, ribs and salads as well as Thai curries and soups.

At present the restaurant’s business model uses multiple and single franchisees across the brands various sites.

The Hammersmith deal was made between UK leisure property agency, Shelley Sandzer, who worked on behalf of the Wellington Pub Company and Tiger Bills.

Henry Wilson, senior leasing agent from Shelley Sandzer, said of the deal: “We continue to work with clients nationwide to negotiate the best opportunities for prime space.

“We are very happy to have acted on behalf of Wellington Pub Company in their deal with Tiger Bills, which has provided the latter with a vibrant, accessible location desirable to any expanding dining brand.”

Subway set to continue rapid growth with MRH deal The UK’s largest food franchise model, that of Subway, will continue to grow as a deal with MRH Retail has been confirmed.

MRH Retail is currently the UK’s largest independent petrol station owner and operator with 370 company owned sites.

As Food Franchise have discovered, a deal between those at the head of the sandwich chain and MRH has been struck, meaning that Subway will operate from 30 additional forecourts by 2015.

The move continues an exciting period of growth for both parties with Subway cementing their position as the largest food franchise in terms of number of premises and MRH improving their lunch offering following on from a deal made previously with Costa Coffee.

Speaking about the deal, Mike Charest, assistant regional director for Subway Europe said: “We are delighted to have a

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development plan in place with MRH Retail.

“Forecourts are an ideal site for our non-traditional stores.

Due to the simple operating procedures and minimal space and equipment requirements that our stores need, we are well suited to these sorts of sites.

“The Subway brand is keen to develop such locations in partnership with successful companies just like MRH Retail.”

John Lynn, managing director of MRH, which owns Texaco, BP, Esso and Jet outlets, echoed these thoughts, saying: “MRH Retail is constantly striving to improve its consumer offerings. We are keen to develop this partnership and look forward to opening further outlets in the coming years.”

Domino’s Pizza Named Top Brand at Youth 100 Awards Domino’s Pizza UK has been awarded the prestigious ‘Best Fast Food’ brand award at the 2014 Youth 100 Awards.

The awards, which are handed out to the UK’s top brands based on votes from a panel aged between 18 and 24, are held in high esteem in the quick service food industry and the latest results meant that the pizza chain scooped the top prize for the second year running.

The awards, held at the MC Motors warehouse, East London, saw stiff competition from industry giants including Nandos, KFC and Pizza Express all battle it out for the honours, with Domino’s named the victors.

It is widely believed that the restaurant group secured the top spot for its commitment to engaging with youth market and growing focus on students.

Nick Dutch, Head of Digital at Domino’s Pizza said: “We’re chuffed to be recognised by one of our core audiences

and to win this fantastic award for the second year running.

“It seems that our approach of combining national advertising with local, street level marketing and student deals is really paying off.

“Online and digital marketing is also a huge focus for this group – from our award-winning mobile app through to targeted SMS messages and sharing fresh content with our social media community; we’re always looking for ways to push the boundaries and speak to our younger fans on their level.”

The Youth 100 survey and awards is considered a unique piece of research for the marketing community, and those who achieve positive results are considered to set the benchmark of best practice within this growing sector.

Food franchisees clean up at BFA awards Two emerging talents from within the franchise industry have recently been rewarded for their efforts by picking up awards at the bfa HSBC Franchisee of the Year Awards 2014.

The lavish ceremony held at Birmingham Town Hall, recognised the achievements of franchisees from around the country and of the six that were on offer, three were presented to those operating a food franchise.

The winners included, Joggy Dhillon, who operates Domino’s franchises in Northern Ireland. His efforts in the Coleraine and Omagh stores were rewarded as he scooped the Customer Service Franchisee of the Year Award as well as £1000 in prize money.

The Young Franchisee of the Year Award went to Landlord and Franchisee, Aaron Stewart, who runs sites under the Marston’s franchise in Sheffield and Mansfield.

Speaking after the awards, Brian Smart, Director General of the bfa, said: “We’ve now been recognising the country’s most exceptional franchisees for a quarter of a century, and each year the bar is raised higher and higher.

“It’s fitting that the 25th anniversary of these awards gave us a cross-section of finalists that showcase the inclusivity of the sector for anyone, anywhere who is aspiring to self-employment.”

Subway star wins Female Franchisee of the Year Award Subway® franchisee, Rachel Shaw has landed one of the most prestigious awards in the industry after scooping the title, Female Franchisee of the Year at the recent British Franchise Association awards ceremony.

Subway® were quick to congratulate Rachel on her win, with a spokesperson for the sandwich giant saying: “It’s fantastic to see one of our franchisees’ hard work being acknowledged.”

The result sees Rachel rewarded for both her entrepreneurial spirit and hard work ethic, attributes which has seen her business go from strength to strength.

Prior to opening her first franchise, Rachel had spent 16 years working in the fast food industry and it was a chance trip to Australia opened her eyes to the growing brand.

Speaking to the BFA, she said: “I was intrigued by the brand after visiting Australia in 2004 with work. “The Subway® brand was everywhere down under! I was particularly interested in this franchise as I’ve always been an advocate for healthy eating and it has great credentials in this area.”

The trip gave Rachel the inspiration that she needed and she duly opened her first SUBWAY® outlet in September 2007 with a premises in Thornton Heath, South London.

Seven years on and Rachel has a second store in West Wickham and employs 14 full and part-time staff.

In May 2013 Rachel’s store became the first SUBWAY® to launch a moped delivery system which proved to be a real success. She also increased her catering services to offices, school and organisations in and around her community.

Rachel says that the key to her success has been playing an integral part in her community.

On receiving her award Rachel said: “I am thrilled to have been awarded the British Franchise Association’s Female Franchisee of the Year. “I love my job and have a great team of people working with me across both stores.

It is an honour to have been recognised for our hard work and success in this way.

“I would like to thank the SUBWAY® brand Development Agents who have empowered me through their fantastic support and guidance over the years.”

Winter 2015 Food Franchise | 7

News

round-up Baskin Robins celebrate 70 years of Ice Cream Baskin Robins, the world’s largest chain of ice cream specialty shops, is celebrating 70 years of innovative and delicious ice cream flavours and frozen treats this month and as a reward for their loyal fan base they’ve created a special treat.

For the month of January they will be inviting customers from around the country to eat their celebratory Icing on the Cake® dessert.

The treat features cake-flavoured ice cream with cake pieces, frosting bits and a candy confetti ribbon and can be enjoyed in a cup, cone, milkshake or two-scoop sundae.

To make the launch of its 70th year even sweeter, Baskin-Robbins will also continuing to offer guests a free waffle cone with the purchase of any double scoop of ice cream including their newest flavours. Some of the flavours that will be available during the celebratory period include: • Peanut Butter ‘N Banana: Banana-flavoured ice cream and a chunky peanut butter ribbon.

• Tropical Vacation Frozen Yogurt: A refreshing flavour featuring pineapple and passion fruit-flavoured frozen yogurt with a passion fruit ribbon.

• Premium Churned Reduced-Fat, No Sugar Added Caramel Turtle Truffle: Reduced-fat, no-sugar-added vanilla-flavoured ice cream packed with caramel-filled milk chocolate flavoured turtles and a caramel ribbon.

Speaking about the latest marketing campaign, John Costello, President, Global Marketing and Innovation for Dunkin’ Brands said: “Over the past 70 years, Baskin-Robbins has grown from a beloved neighbourhood ice cream restaurant in California to the

world’s largest chain of ice cream specialty shops, offering guests an extensive variety of ice cream flavours and frozen treats and we want to continue that.”

Starbucks target evening market with alcohol sales Starbucks is to add beer, wine, and evening snacks to thousands of its cafes, as well as expanding lunch options and rolling out a mobile ordering system.

The marketing team at the coffee giant are making a conscious effort to broaden the businesses appeal as a destination to visit at any time of the day.

Traditionally the stores have long been associated as places to grab your morning coffee, breakfast, brunch and lunch, but all this is set to change as the group target those heading home from work or looking for a sociable meeting spot.

With consumers spending an increasingly large amount of time shopping online it is thought that a menu change and the introduction of alcohol will help the public in choosing their stores as an evening or

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weekend destination.

The company plans to double US food revenues to more than $4bn within five years by expanding food choices, particularly during lunch hours and are hoping to add about $1bn to sales by creating the evening menus and serving alcohol at nearly 3,000 of its 11,900 cafes in the US. The final change will see the company launch a mobile ordering and payment system that it says will make getting coffee, quicker, easier and even more convenient.

The technology will also rollout in the US next year.

Drivers earn slice of the action as Domino’s create 2400 festive jobs As with most companies over the festive period, there is a need to employ more staff to fulfil consumer demand and the world of pizza delivery is no different.

Over the last few months Domino’s pizza were forced to recruit 2400 new delivery drivers to help deliver nearly 12.5 million pizzas to hungry homeowners and to office parties.

Speaking about the recruitment drive, Scott McLeod, Operations Director at Domino’s Pizza UK said: “The Christmas and New Year season is when we really ramp up our recruitment efforts. For many people, it’s a great time to make some extra money for the holidays, or a start rewarding new career.”

We looked for hard working people who enjoyed offering great service and care to our loyal customers. Delivering pizzas is a fun and rewarding job and there are long term opportunities, indeed

most of our store managers started out as delivery drivers, with some then becoming franchisees.”

Papa John’s continue growth with 5 openings Leading pizza chain Papa John’s have continued to make inroads into the market with a number of high profile openings over the last few months.

As reported in the last edition of Food Franchise, the chain founded in the US in the 1980’s added to their 257 stores with the opening Jitesh Patel’s store in Bradley Stoke, Bristol.

Following on from this Papa John’s has announced five new further openings in quick succession.

The first person to grab a slice of the action was franchisee Steve Mullarkey who currently owns the Warrington branch. With the help of the Company’s franchisee incentive deal he has added branches in Preston and Chester to his portfolio.

Since Steve opened the units he reports that they are both performing better than expected, saying: “Preston and Chester have only been open a couple of weeks but they have exceeded all expectations.

“We ran some special promotions and our Chester outlet is really already popular with students. We are based under the halls of residence and so the

walk in trade has been exceptionally high.”

Following on from these two openings in the North, Abdul Sattar Karami took up options to open stores in Harpenden and Leighton Buzzard, whilst Kashif Michael opened his second store in Cardiff.

Kashif’s first store on City Road, Cardiff has been successful enough to warrant his second. The delivery store he has opened in the Canton district of the city is expected to fulfil the high consumer demand.

Speaking of his expectations Kashif said: “The City Road store already had an existing customer base when I acquired the franchise. However, with some proactive marketing I was able to grow local brand awareness further and improve turnover dramatically as a result.

Canton is a brand new store and so far, so good. With more leafleting campaigns, product sampling and the some special promotions in the pipeline, sales will continue to grow!”

Wok&Go continue expansion with three new stores One of the UK’s fastest growing franchise opportunities, Wok&Go have continued to expand their market presence with the announcement of several new stores since the last issue of Food Franchise Magazine.

The last quarter was a significant one for the brand founded by Des Pheby, with three stores opening in late November and early December.

The new sites opened in Albion Street, Leeds, St Mary Street, Cardiff, and at the Vangarde Retail Park in York.

To launch each store, franchisees orchestrated a Grand Opening Week, offering new customers the chance to taste their food whilst earning the opportunity to win deals, freebies and other prizes.

For regulars of the noodle bar, the Albion Street store in Leeds is the third Wok&Go to open in the city whilst residents of York welcomed their second store which occupies a prime position on the hugely popular Vangarde Retail Park, to fulfil demand.

Cardiff however have seen the first branch of Wok&Go to open in Wales and is already attracting much attention from eager noodle-fans!

Winter 2015 Food Franchise | 9

News

round-up KFC to celebrate 75th anniversary of ‘secret recipe’ It’s a secret that has been kept for nearly 75 years and is one of the most famous from within the food industry but KFC show no sign of letting their famous recipe slip.

Instead they’re celebrating it.

KFC who operate under the parent company, Yum! Brands are said to be planning a string of celebrations to commemorate this historic anniversary.

Chief marketing officer for KFC US, Kevin Hochman said: “We’re working on an advertising campaign that will bring back his (Col.Sanders) voice.

“We have a lot of innovative surprises for the 75th anniversary” Senior figures at the company hope that the latest set of innovations and marketing campaigns will aid growth after recent figure show they have lost their crown as America’s largest chicken chain.

Last year KFC posted sales figures of $4.3billion in the US, $0.7 billion less than rival company Chick-fil-A.

McDonalds launch a build your own burger It is no secret that McDonalds have struggled to maintain sales over the last year with decline evident both in-store and on the stock market.

It is thought that the firm will announce net losses in Japan for the first time in 11 years and logistical problems have led to product shortages in Venezuela, these being just two of the problems the brand have faced in the last few months.

In a bid to recoup and cement themselves at the head of the fast food market, there must be changes and in order to stave off any further sales losses, the marketing team are looking at new ways to entice back a deserting customer base.

In a major shake-up of the way customers place their orders the fast food giant have opted to rollout their build your own burger scheme.

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Titled the ‘Create Your Taste’ initiative, it is thought that the concept of having food just their customers want it will bring them rushing back.

The idea, which is the largest menu change since the company introduced the breakfast menu over 40 years ago, is an expansion of a test that lets people build their own burgers by tapping on a touchscreen and the company said in December, that it plans to expand the option to 2,000 of its 14,000 US locations by next year. They have also said that they plan to improve “technology,” but without replacing workers with robots.

The “Create Your Taste” program is a major change for the McDonald’s ethos which has been to deliver their menu items like the Big Mac consistently, quickly and at an affordable price.

This model has been challenged of late with the popularity of market rivals such as Chipotle and Five Guys soaring. The rival brand stress higher-quality ingredients and already let people create bespoke burritos and bowls.

Industry executives and analysts have noted the growing demand for customised orders, particularly among the under-30 market and that this group are also showing greater concern for the ingredients in their food.

Offering greater personalisation is not without its pitfalls however. The customised burgers will take longer to prepare and are more expensive, and it’s not clear whether people will be willing to wait longer or pay more money for a McDonald’s burger.

McDonalds have stressed that the locations that have the “Create Your Taste” option available will still have its regular menu as well.

Former Banker Donna King joins Franchise Finance Board members at Franchise Finance, one of the industry’s leading, independent financial experts have announced a personnel change with Donna King joining the team as Business Development Manager.

Directors Chris Roberts and Stuart Walsh are said to be delighted at King’s acceptance of the role and announced that as of the 1st of January 2015 she had joined on a full time basis.

King joins the team with over 20 years of banking experience, the majority of which was spent with RBS looking after both franchisor and franchisee relationships. Her performance was rewarded with many awards during this time including the bank’s ‘Outstanding Achiever Award’ in four consecutive years.

In August 2011, King became the bank’s Franchise Business Development Manager with a national remit to build relationships with franchisors across the UK, with a view to providing banking/ funding support to both franchisors and their franchisees. During this time, she successfully attained her Certificate in Credit, RBS Franchise Accreditation and her Qualified Franchise Professional award from the British Franchise Association.

Chris commented, “Donna is very well known in the Franchise Industry and is a great addition to our expanding team.

“She is looking forward to helping us grow our business by meeting and introducing our financing, business planning and training services to an even wider range of franchisors and franchisees.

“Donna is actively involved with Encouraging Woman into Franchising (EWIF), and is looking to continue and further enhance our relationship with this group.

“We are extremely excited to have Donna on board and look forward to an exciting new year.”

Fast-food scandal rocks Chinese market Subway has become the latest high profile brand to be involved in China’s ongoing food safety scandal after it emerged that the US sandwich giant was investigating media claims that workers at a Beijing franchise altered expiration dates on food ingredients.

Subway joins McDonald’s and KFC in finding their brand reputation called into question in the country after allegations arose that staff at either suppliers or franchises have served food to customers which is beyond its expiry date. A story released in the Chinese media said that one Beijing franchise of the Subway chain changed expiry and production dates on meat, drink and vegetable produce to extend their use whilst Subway defended themselves and their franchisees in a statement saying: “We have been made aware of these claims and are investigating them.

“This is not representative of the diligent Subway owners and sandwich artists in the Subway system. We will investigate and enforce our strict operational processes.”

The company, which has 489 franchises in China, conducted a surprise visit to the alleged location of the scandal in the days following the report surfaced, but said that they found no violations.

QSRs see market share grow.

As has been the trend over the last decade fast service restaurants or QSR’s as they are more commonly known, continue to boast high growth figures.

Ranging from the big hitters in the market such as McDonalds and Subway to the independent fish and chip shops and bakeries, QSR’s are seeing high returns from limited menus and low cost items.

These operations which are typically part of a franchise usually offer no table service and meals for under £6, a large portion of them now also include a drive through service and are designed for fast, casual use.

Such are the benefits in these types of business it appears as though they have already consumed the lunch trade and are making inroads to meals for commuters and the evening restaurant market.

Winter 2015 Food Franchise | 11

News

round-up Latte loving Brits choose their favourite brew An independent study by award-winning mobile coffee franchise, Cafe2U, has revealed that the coffee of choice for the UK market is the Latte.

Looking at the results of their coffee drinker’s survey it is clear that the espresso and steamed milk drink, traditionally served in Italy with breakfast is the nation’s favourite, polling 32% of the vote.

The famously frothy Cappuccino and the standard issue, ‘Flat White’ finished in joint second with 18% of the vote each, whilst the Americano, a long black coffee with a drop of cold milk finished last with just 3% of the vote.

The poll was conducted on a sample of customers for the franchised business, who recently launched their 60th mobile coffee van and there was more to shout about for Cafe2U as the survey also revealed that customers are loyal to their mobile coffee supplier too.

A second set of results found that 52% of those polled visited the van 3-5 times a week and 82% of them saying they ‘preferred’ the award-winning Cafe2U coffee blend to any other espresso-based coffee products they purchased.

Managing Director of Cafe2U, Tom Acland said, “The results of this survey are great for everyone at Cafe2U. “We always suspected the latte was people’s favourite espressobased coffee drink, with many of our customers saying it helps

‘fill them up ‘till lunch time’ but to hear that 82% of our customers actively prefer our blend to our high-street rivals, is music to our ears.”

Coffetek introduce ‘Button Gourmet’ - the latest in retail coffee vending Pioneering designers at Coffetek have released their prototype for what could be the next big thing in coffee franchising - Button Gourmet.

One of the hottest trends in the food franchising industry at present, is the development and implementation of technology to improve the customer experience.

The award-winning team, who have spent the last 30 years manufacturing beverage dispensing systems, have developed a

12 | Food Franchise Winter 2015

product which combines vending, retail and a cafe in just seven meters of space.

According to the company: “Button Gourmet has been developed for the contract catering market to provide quality food and drink in high-footfall locations such as corporate offices, train stations and hospitals, without the operating costs of retail outlets.”

Indeed this last point is particularly poignant with property costs at an all-time high. Many of those looking to begin a franchise are left feeling that the marketplace for coffee is saturated by the big brands rolling out store after store and that they have a monopoly.

A spokesperson for Coffetek added: “The modular unit, which is powered by a three-phase supply, will support the provision of high quality food and drink in areas where time and resource is limited.

“There is room for an extensive menu of up to 180 different foods, snacks and cold drink products within the unit as well as barista style hot beverages.

Other unique selling points are that food products stored safely in a multi-temperature atmosphere and there is a single payment and delivery area for customer convenience

Alcohol industry news

Publicans shop around after ‘beer tie’ scrapped in commons vote A landmark vote in the House of Commons has brought about the beginning of the end for tied public houses.

The result of a recent debate inside the House of Commons has been seen as a ‘big win’ and a ‘positive step’ for publicans, as ministers voted to scrap the beer tie which has crippled the industry and left many landlords either underpaid or forced to close their doors.

In what many in the industry have described as a the biggest change for centuries, the radical vote essentially allows landlords to buy their stock on the open market and at a fraction of the price paid when forced to buy through their pub groups.

Independent research by the Campaign for Real Ale (CAMRA), found that tied licensees were paying around £150 for a keg (11 gallons) of Foster’s lager compared to the wholesale price of £85. A difference that equates to a 77 per cent or 73p per pint rise.

The issue of tied-houses has raged on for many years, with pub firms claiming the reason for the higher prices is because they

rent out their outlets at a discount so that tenants are able to get a foothold into the industry.

The result of the vote left many of the industry leaders reeling on the stock exchange, with shares in Enterprise Inns dropping by 13 per cent after the news and Punch Taverns seeing a 9.4 per cent slump. Between them they own around 20% of Britain’s 50,000 pubs.

Other pub groups, Greene King, Marston’s and Mitchells & Butlers also saw their share price fall.

Beer Dock set sail with three new sites One of the latest franchises to hit UK shores, Beer Dock, is set for an expansive roll out of new properties, with three openings planned in the coming months.

Speaking exclusively with Food Franchise Magazine, owner Sam McGarrigle explained that deals were being lined up to open branches of their successful micro-pub/off-license in various locations across the UK. Currently operating out of their headquarters and flagship store in Crewe, Beer Dock boast an impressive array of over 1000 craft bottled beers from around the world, as well as six craft keg lines and one hand-pulled real ale.

The initial plans will see their first franchise open in Nottingham in the next few weeks with company owned ‘Beer Docks’ to follow in Altrincham and Stoke-on-Trent.

German Restaurant chain offers UK opportunities Over the last few weeks many of you will no doubt have been to one of the many Christmas markets across the country.

Many will have sampled some of the festive treats whilst sipping on mulled wine or a traditional German beer.

Such is the popularity of these events that one company has seen demand increase in their authentic beer-house and are looking to branch out by recruiting more franchisees.

The Bavarian Beerhouse currently operate in three locations across the South of England, two in London and the other in Bristol.

The units serve over 100,000 members of the public during their 8-week Oktoberfest period and are popular amongst locals.

With a menu packed full of German classics such as pork shanks, sausages and pretzels and a claim that have the largest sales of Erdinger Wheatbeer in the UK this is one to watch.

Winter 2015 Food Franchise | 13

FINANCIAL industry news

Labour Promise Minimum Wage Rise If Elected Franchisees could face huge changes to their pay structure later this year following an announcement from Labour leader, Ed Miliband relating to the minimum wage.

The current Leader of the Opposition and MP for Doncaster North, Mr Miliband, has promised a rise in the UK minimum wage, should his party be successful in the general election on May 7th 2015.

At the time of the last general election in 2010 the minimum wage for adult workers was £5.80, under the new proposals this figure could rise well above inflation to £8 per hour.

Miliband said that it was “not good enough” that one in five people in the UK were on such a low wage.

A Labour party spokesperson also added that: “the pay rise would be introduced by the end of its first parliamentary term in government.”

A change of this nature would take the minimum wage ahead of the estimated living wage, which has itself been raised by 20p to

£7.85 an hour.

The hourly rate, based on the amount deemed necessary to cover basic living costs, is a voluntary rate which has been adopted by over 1,000 employers UK-wide.

This means 35,000 workers are now paid 21% more than the compulsory UK minimum wage of £6.50, as set by the current government.

GMB general secretary, Paul Kenny said: “This is a welcome and necessary first step for workers to recover the nearly 15% drop in the value of earnings they suffered over the last six years.

“It is important to shift the burden of dealing with low pay from taxpayers to the employers many of whom are sitting on record levels of cash and profits. The transition must be real so that the increase is not paid with one hand and taken away with the other.”

Osborne announces business rate reliefs in Autumn Statement

Chancellor George Osborne has once again reiterated the government’s pledge to support small businesses in his Autumn Statement.

Speaking in early December Mr Osborne revealed that the Treasury had promised an extra £400m to further extend government-backed Enterprise Capital Funds which invest in SMEs across the country.

He also pledged that the government would inject another £500m to SMEs through bank lending.

In a bid to raise £10n worth of finance for such businesses Mr Osborne said: “Now that credit conditions for households and large businesses have improved, it is right that we focus the scheme’s firepower on small businesses, which are the lifeblood of our economy.

Under the scheme, the government have guaranteed that they will cover 75% of an SME’s bank loan, whilst other lenders will cover the remaining 25%.

In a bid to please the hospitality sector the Chancellor said that the government will continue to cap inflation-linked increases in business rates at 2%.

There was also news of a 50% increase in the £1000 discount on rates that pubs, cafes and high street shops receive meaning that many businesses will see £1500 worth of relief.

He added: “These benefits relate to half a million firms and means a third of a million firms pay no rates and we’ll continue to fund this.

“The government has repeatedly helped small businesses deal with the burden of business rates.

“We do so again today.”

In closing his statement, Osborne suggested that a long-term solution was needed and that there would be a full review of the structure of business rates and that this review would welcome those affected to engage with the government.

14 | Food Franchise Winter 2015

FINANCIAL industry news

McDonald’s share price drops as U.S sales fall McDonald’s the world’s largest restaurant chain, has seen their share price fall dramatically since the last issue of Food Franchise Magazine after what some in the industry have described as a ‘sales slump’ Profits at the fast-food giant have been declining over the last year with the latest figures showing a 30% drop. The net income of the business plummeted from $1.52 billion to $1.07 billion since 2013.

These poor sales in the U.S are said to be the result of direct competitors launching new products and the company raising prices to cover rising staff and ingredients costs.

Chief Executive Officer Don Thompson predicted that global comparable-store sales would continue to fall in the short term, but insisted that changes were being made.

In a statement Mr Thompson said:” The internal factors and external headwinds have proven more formidable than expected and will continue into the fourth quarter.

“These significant challenges call for equally significant changes in the way we do business.”

McDonald’s said that they are looking at a new global strategy that includes investing in store remodels and technology as well as mobile ordering and payments.

Mixed fortunes for Marston’s on Stock Exchange Over the last quarter the Stock Exchange has been home to some mixed news for brewers, franchisors and pub owners. One such company to see fluctuations in their share price is Marston’s.

At first, the pub company released a strong set of figures, highlighting full year sales growth. Their numbers exceeded market expectations by posting figures which showed a like-for-like sales growth of 3.1% in its Premium and Destination arm for the 52 weeks to 4 October 2014, a result which led to a year high of 157.20p.

A revitalised business strategy and figures showing that average profit per pub rose by around 10% left Marston’s in strong position.

It is believed that their current plan is to invest in pub-restaurants nationally, whilst selling off their smaller, wet-led pubs.

This rollout started with 27 new-build pub-restaurants opening, figures which met their growth requirements in stage one. Stage two has been to sell 388 wet-led pubs and other assets, cutting the portfolio from 2,050 pubs to 1,689 by the end of the year.

Chief executive at Marston’s, Ralph Findlay, said: “This year we have made good progress in transforming the quality of our pub estate through the continuation of our new-build development plans and the disposal of weaker pubs.”

“Looking forward, we will continue with our expansion strategy to invest in at least 25 new-build pubs each year. We also remain on track to dispose of the residual 200 pubs targeted for sale from our taverns estate over the next 12 months to create the desired structure for our business for the future.”

However news that the government were to abolish the ‘beer tie’ and ultimately allow landlords and tenants to choose where they buy their stock from and at what price, means shares in the brewing industry as a whole took a dip, Marston’s trading at a year low of 134.50p. At present around 75% of the pub groups profits are generated by managed or franchise-style sites, many of which could be affected by changes to the licensing laws.

Current trading is solid however with parity temporarily restored at the sector waits for full clarity on the issue. At present like-forlike sales in destination and premium Marston’s units are ahead by 2.1% with other taverns also ahead by roughly 2%. Findlay added: “There are some signs of modest economic improvement, with the emergence of real wage growth and resilience within the economic regions outside London.”

Winter 2015 Food Franchise | 15

internationAL industry news

Burger King face mixed response to Beef-Free Whoppers As you may have read, the world’s second largest burger chain, Burger King have recently ventured into India and it’s fair to day that some of their menu choices have received a mixed response.

The launch in mid-December was greeted by consumers who already have access to a range of western food brands, such as KFC, McDonald’s and Domino’s Pizza.

For potential customers, news that the fast food giant was heading to India was seen as a positive leap into a growing market and for Burger King, India was a logical move and commercial must.

Burger King announced the news of their arrival in India on their Facebook page where they posted to say: “GREAT NEWS - THE WHOPPER IS COMING SOON TO INDIA!” They followed this announcement moments

later by saying: “We do not have beer on our menu but the alternatives will certainly delight you.”

The decision to ‘drop’ the beef Whopper in preference to chicken, mutton and vegetarian Whoppers was thought to be down to cultural and religious reasons with the catchment areas of the stores, although Burger King hadn’t commented at the time of press.

Some customers did speak however and thought that the concept was ‘old-fashioned’ saying that there was as place in the market for the original recipe burgers.

Customer, Vishal Mehra posted a link and

wrote: “Foodies, please sign this petition to urge Burger King to bring real whoppers to India, and not fake veggie whoppers. Spread this far and wide.”

Whilst another quizzed the fast food giant and asked: “Why not launch the veggie Whopper in the US as well? There is a market for it in the USA” The Asia Pacific region is currently the smallest for Burger King with just 1100 of their 13,667 placed there.

Initial media reports suggest that the chain will open 12 stores this year in cities including Bangalore and Chennai.

International investment welcome for Esquires Coffee houses As Esquires Coffee Houses see their global franchise rights purchased, managing director Peter Kirton, insists it will be business as usual in the UK. Mr Kirton and others at head office, have welcomed the news that the community coffee chain’s international affairs are set to grow, and has suggested that the acquisition from New Zealand based company, Cooks Food Group, will make the UK brand stronger.

It is understood that Cooks has entered a conditional sale and purchase agreement to acquire shares of Franchise Development Ltd (FDL), a deal which will see them gain master franchising rights to Esquires Coffee Houses around the world.

Peter Kirton, managing director of Esquires Coffee Houses UK, said: “This investment in the Esquires Coffee Houses network is very welcome news.”

In connection with the transaction to Cooks, and through a $1.3m secured advance from the company, FDL has now also acquired the Canadian company Esquires Coffee International, Inc. As a result of this sale, it has become the master franchiser of the global intellectual property rights to Esquires Coffee Houses – overseeing a network that includes the UK and Ireland franchised operations, but excludes Canada, New Zealand and Australia.

Mr Kirton added: “While business will remain as usual in the UK, we will additionally benefit from a stronger global brand and the experience and expertise that will be made available to all master licensees.”

Establishing an international brand “Over the last 2 years we have started to establish ourselves as an International brand; franchising in Middle East and recently signing a Master Franchise for India. In my opinion and experience up to now the market is very buoyant. The Middle East region is a wellestablished franchise market with most of the big food operators you see on the high street now operating there, where I see the change is as these were predominately American fast food brands, I now believe there is a demand for a more sophisticated premium food offering, and UK brands come to the forefront with an array of young brands with ambitions to be the next big thing.

Taking your brand international is not for everyone; some brands are happy to stay in the UK or even just stay in London. They have a multitude of reasons for doing this; preparing themselves for private equity sales, they see overseas franchising will create a complicated

16 | Food Franchise Winter 2015

business model, a lack of ambition, scared they may lose control of the brand or just a simple lack of understanding on how to achieve it.

I see International franchising as a huge opportunity and it doesn’t have to be complicated if you use the right consultants and are prepared to put some hard work in at the beginning. You need to understand the potential pitfalls and you need the infrastructure in place to take advantage of opportunities as they arise. The potential financial rewards can dwarf the home domestic market very quickly, with entry fees payable, store openings and ongoing royalties. We use these to reinvest in the brand and this reduces our need for outside finance and only serves to enhance our UK operations.

There are opportunities everywhere, from India, China to Kazakhstan. Global economics means Global wealth, and everyone needs to eat. Eventually the new markets realise it isn’t

all about fast food chains and they demand more quality – that was our opportunity. Being the biggest noodle bar chain in the UK we are the obvious choice if they are looking for an Asian fusion concept. We expect big things for us in 2015 and I fully to expect to announce Wok&Go entering new overseas markets very soon.”

business profile

Papa John’s Launches 2015 Franchisee Incentive Scheme Leading pizza franchise, Papa John’s, has launched its franchise incentive scheme for 2015. The Company is offering franchisees discounted royalty fees, contribution towards marketing spend plus free equipment for new stores opening in the enterprise development zones of the Midlands, Wales, The North West, North East and Scotland in 2015.

“The Papa John’s franchise is growing rapidly in the UK,” confirms Anthony Round, business development manager, Papa John’s. “We are aiming to attract more enthusiastic and business minded franchisees who are keen to open multiple Papa John’s stores. With this in-mind, we have come up with one of our most tempting franchise incentive packages yet.

Designed specifically to help franchisees in the early stages of growing their businesses, the deal includes marketing support for all new store openings in the first six months of trading, free equipment and reduced royalty payments for 15 months including three months free.

“Our pizzas are created only using the highest quality ingredients and 100% fresh dough to make a top quality product with a better natural flavour,” explains Round. “Combine our popular pizza with excellent customer service, rapid delivery

times, a strong brand, comprehensive staff training and some hard hitting marketing support and the franchise serves-up a fantastic offer for those looking for a quality investment opportunity.

“Topping that, the new incentive deal gives franchisees a helping hand at the outset to ensure they will be quick to taste success!” confirms Round. “With over 280 UK stores and a record number of traditional openings in 2014, there has never been a better time to join Papa John’s.”

Papa John’s is one of the largest pizza companies in the world and has opportunities for franchisees throughout the UK including the key locations of the South East, Yorkshire, Manchester, West Midlands, East Midlands, South West, North East, Wales & Scotland.

At Papa John’s, comprehensive training is provided and head office staff are always

on-hand to help and ensure franchisees get off to a good start. Naturally, staff training is also an on-going task. We help franchisees train staff through an online, module based learning system. Because personnel are certified once they have successfully passed the test at the end of each learning module, this also helps franchise owners monitor their staff training easily. This is particularly helpful for some of our multi-store franchisees who are managing multiple teams.

For those interested in becoming part of Papa John’s success story, help is also provided with location selection and shop fit-out. As a franchise, the Company supplies all the assistance needed to get your successful Papa John’s up and running. For further information please visit: www.papajohns.co.uk/franchise call: 0844 567 0937 or e-mail: enquiries@papajohns.co.uk

Winter 2015 Food Franchise | 17

industry VOICES

industry

voices Deciding to set up your own food franchise can be a difficult decision and there are many different areas of consideration for those venturing into the industry.

Week in, week out, we receive a large volume of emails and calls, posing different questions about the content in our magazine and about the industry in general, that’s why we’ve decided to run our first question and answer session.

The following 7 pages are full of real stories, by those who have moved into the food franchising industry. They cover a variety of business topics to give you the best possible insight as to what it takes to open your very own food franchise.

So let’s meet the experts: Subway – Ian Dawes – After a 20 year career working for others and gaining a prestigious Michelin Bib Gourmand as a chef at the Rose & Crown in Sutton-on-theForest, North Yorkshire, Ian decided that a food franchise was the obvious choice for him. After much deliberation Ian choose Subway as his brand of choice and has since opened three units on the outskirts of Leeds. Presently he operates branches in Guiseley, Horsforth and Seacroft with plans to open further stores in the future.

Papa John’s – Erol Ayvaz - After 6 successful years working up the corporate ladder with Market Force information, Erol found himself as a key market strategist and on the board as a Vice President a role which has seen him pick up many skills. In January 2014 Erol became the Owner and Director of First Serve Ltd a multiple franchise owning group who have recently added 6 Papa John’s sites to their portfolio.

This ambitious group are hoping to become the major operator for several groups including Subway and Papa John’s

Esquires Coffee – Dale Smith – After a successful career in the oil industry, working offshore, at numerous locations around the world, Dale and his partner Clare, (A nurse working in cardiology) decided to take early retirement. Their new found freedom left them with both time on their hands and the financial security to take a well-earned break. The couple pursued their passion for travel by embarking on several cruises, but a larger project was needed. Dale and Clare decided to stay true to their roots and take over their local coffee shop in Durham. The riverside store was the first to benefit from a nationwide rebrand and is hugely popular with the locals.

Harry Ramsden’s – Mike Langan – Mike has been involved in the food, hospitality and franchising industries since the mid ‘90s and after successful posts with Scottish and Newcastle (Now Star Pubs and Bars) and Signature Pubs he went on to take a role with Road Chef. As a Site Director he overlooked the successful development of his site in Lockerbie which included McDonalds, Costa Coffee and an own brand breakfast outlet. His latest position sees him as the Regional Manager for Seven Seas Ventures Ltd where he looks after a portfolio which will include 50 Harry Ramsden’s across Scotland over the next few years.

18 | Food Franchise Winter 2015

industry VOICES

The Franchisee What made you decide to open up a franchise?

Erol Ayvaz: I’ve always wanted to run my own business and franchising offers a solid business model. It allows rapid set up and the potential for expansion. I joined Papa John’s as a franchisee in the summer and now run the Cambridge and Peterborough stores and opened Corby in September and Lowestoft in November. I have a development plan to take store numbers up to ten within 12 months plus a further ten the following year. It would be impossible to achieve this in a business starting completely from scratch.

Mike Langan: Having been involved with Franchise operations within Roadchef I know that franchising offers an excellent opportunity to be involved with an established brand name, which gives you an immediate competitive edge in the market as well as the ability to grow much more quickly.

Dale Smith: Having worked for a long period of time in the oil industry and working offshore I decided to make a change. My partner Clare was a nurse working in Cardiology and we had saved enough money to take a career break. After a while we became bored and needed a new challenge so we started to look at business opportunities.

Ian Dawes: As a chef I had always wanted to open my own food business, however in 2008 during a recession, I felt that opening my own restaurant or pub seemed a bad idea. I looked around to see if I could find a brand that was doing well during this economic downturn. Subway® was a high profile brand that was definitely on the up and up.

What did you do before deciding to start a franchise?

EA: I’ve spent the past six years working with organisations on customer insight and research. I’ve always been fascinated by brands like Papa John’s and how they engage with their customers, so decided it was time to practice what I’ve been

preaching and get a slice of the action by becoming a Papa John’s franchisee.

ML: I’ve been in the hospitality industry for many years, involved in the pub and restaurant trade in Edinburgh where I held a number of senior management positions and was responsible for the launch and growth of many different outlets. After that, I moved to Roadchef where I became a Site Director.

ID: I had worked in restaurants and pub kitchens for around 20 years. I was Head chef of a busy pub/restaurant by the time I was 18 and I continued to run restaurants and hotels until I started with Subway®.

How much experience did you have of running a business or leading a team prior to franchising?

EA: I’m probably unusual in that I already run another food franchise but I was looking to expand my business interests further and Papa John’s was the clear choice.

ML: Because of my background, I would say I had vast experience in this field which is certainly a plus.

DS: Clare had worked in high pressure environments whist in the medical industry and I had worked in various teams during a career in the oil industry. I also set up a business of my own and operated as a consultant dealing with groups of people and individuals from various backgrounds and businesses.

Winter 2015 Food Franchise | 19

industry VOICES

Choosing your Food Franchise How did you find out about franchising, did you read trade magazines or visit exhibitions?

EA: Before buying into Papa John’s I did research online and met with the head office staff. I looked at other fast food brands and Papa John’s stood out from the crowd because it is expanding and growing in popularity rapidly.

ML: I read in the trade press that Harry Ramsden’s was under new ownership and even before they announced their new franchising plans, got in touch with them to express an interest in the Scottish market.

DS: Yes we looked through the trade press and attended many shows whilst looking to set up a franchise.

ID: First port of call was the www.subway. co.uk website that had plenty of info regarding becoming a franchisee. After that I went to the franchise show at the Birmingham NEC and looked at Subway along with many other food and nonfood brands and companies. After that I attended a Subway® Franchise Seminar in Manchester.

20 | Food Franchise Winter 2015

What made you decide to look at a food franchise and did you look to other industries first?

ML: Given my background, a food franchise seemed the natural choice so no, I didn’t look at other sectors – I thought it best to focus on and play to my strengths.

DS: We are both foodies and wanted that personal service element that comes with the industry. We really wanted to give back and a food franchise would allow us to do this.

ID: I looked at all manner of businesses such as printers, key cutters, car repairs and carpet suppliers, however food was my particular skill so I stuck with a QSR brand.

How did you know which franchise to choose?

AE: Some of the other big players in the fast food market are saturated; however Papa John’s offers the opportunity to grow with the brand. I felt it was the ideal time to buy into an expanding company with enthusiastic staff behind it. In the past few years the company has experienced unprecedented growth and I wanted to be part of that.

ML: To be fair, even although we knew it was Harry Ramsden’s that we wanted, we did look into how other fast food operators were faring in the market and saw the incredible growth of fairly recently introduced franchises. The fact is, fish and chips is one of this country’s favourite takeaways, selling close to 400million portions annually yet the biggest name in the market was vastly under-represented in Scotland - this simply further confirmed there was an opportunity for sustained growth in a relatively short period of time.

DS: Well we were in the fortunate position that we love our coffee and we knew this area of Durham from previous visits.

Realising the potential to open a branch of Esquires was an easy choice.

ID: Subway® provides a great deal of healthier food options and seemed to be a superior product to those just selling pizzas or burgers. Everyone needs to eat and in this day and age so many people are looking to move away from fattier foods and find a healthier option. For me I just didn’t want to be churning out burgers all day so aligned myself with a trusted and responsible brand.

industry VOICES

Finance How did you come about funding your franchise?

AE: Initially my plans were self-funded by myself and business partner but the banks have also been keen to talk to us about our future expansion. RBS has been particularly helpful. Papa John’s is at a ‘boom’ stage and the banks understand the franchise is a sound investment.

ML: Initially sourcing the funding proved relatively difficult because we didn’t have a track record in franchising, however, by this stage, we were in early talks with the team at Harry’s so to be able to tell potential lenders that there was a world famous brand name involved certainly opened enough doors for us to progress.

DS: As I say we both had good jobs and had

put the money away, it was there for us to invest should we choose too.

ID: I was lucky enough to have a small inheritance fund that I was prepared to invest, my father was also willing to take part in the venture. However we did borrow some funds from the bank to help us start off knowing we would need more cash in the future for further expansion.

scratch. Subway always made it clear what costs were and what to expect regarding fees and licences. However you set up your own business entity such as a Limited company or Limited Liability Company and as such you incur any risks associated with doing so. Therefore you shape how you run that company, whether it’s successful or not and what you want to spend on marketing or promotions.

What was you initial budget and were any extra costs visible from the start?

How much support did you receive from the banks or other lenders?

DS: We started at the list price of between £175-250k and took it from there, we had a lot of positive conversations and moved forward.

ID: Getting finance in 2008/9 was nigh on impossible and we struggled. We did secure some support from a bank but a lot of security was required. We’ve been lucky enough to build up a strong relationship with HSBC® over the years and since we have now proved that Subway® works they are happy to continue lending to us as we open more stores.

ID: At the time we were told by Subway® that we would probably need somewhere between £90,000 to £125,000 to open either an existing store or one from

Winter 2015 Food Franchise | 21

industry VOICES

Legal Was there a clear, coherent contract laid out?

EA: Like all good franchisors Papa John’s provides a coherent and fair franchise contract.

ML: Yes we were perfectly happy with the contract presented to us – there were no surprises.

DS:Yes it was a typical franchisor/ franchisee contract and we were pleased with the terms of it.

ID: Subway® are very clear from start to finish as to what is required legally.

However you should always seek Independent legal advice which we also did.

22 | Food Franchise Winter 2015

Were all of the facts made clear to you and were you happy with what was required from you?

Do you feel that the contracts you have in place are secure and protect you from additional liabilities?

ML: Absolutely – we had many meetings with the Directors in advance of signing and clearly understood the roles we would each take on, in the partnership – that remains true today.

ML: Again, I have to say yes – there is a trust between ourselves and the team at Harry’s and that is invaluable in business

DS: Yes I realise that I have to be a brand ambassador but that’s not just for them, it’s my business and I’m hugely passionate about it. I love the store, the location and the customers. We sell great products and the community have taken to us. We’re busier than out competitors from what I can see.

DS: Yes we are in a good place and are happy with the deal laid out. Our investment looks good as this is a growing brand.

ID: All contracts are secure and legally binding for both parties. Additional liabilities are always a possibility but only if you don’t adhere to the rules, in 4 years I have never been charged any additional costs.

industry VOICES

Marketing How much do you have to pay into the marketing budget or is this included in your franchise fee?

EA: Several of the stores I own were resale so there was relatively little launch marketing required. However, with new openings such as my Papa John’s in Corby where we organised a ‘pizza party’ to build local brand awareness. Marketing is an ongoing part of everyday business. We have some exciting marketing initiatives on the menu including Partnerships with some innovative local organisations which will be sure to attract attention and will no-doubt be one of the key ingredients of our success.

ML: Whilst marketing is covered, we do undertake a limited amount of local activity to further support our own outlets.

However, that said, Harry’s are good in offering the chance to get involved in different types of promotional activity which they instigate and are active in terms of PR and on social media which all helps raise awareness of the brand…which is great for us as we continue to grow.

DS: We pay a fee, there’s no secret about that but its early days for us yet and the brand is growing so we don’t talk about those figures.

ID: Subway® charge an additional 4.5%

on top of your franchisee fee that goes towards a national advertising fund. This is what pays for all national TV adverts, radio adverts, press, billboards, leaflets and all the in store marketing. Some of this money is also spent regionally by franchisees to build sales locally. All in all it’s a very cost efficient and effective way of marketing, not something many other brands can do.

How large is your internal marketing compared to that provided by the franchisor?

EA: The roles are very different. As a franchisee local marketing is an important ongoing task. Leafleting and partnership marketing and various promotions build local brand awareness are all important and as a franchisee I take care of this.

Papa John’s builds the brand on a macro level. In 2014 Papa John’s sponsored the Football league. The head office also does national PR, radio and TV advertising and has a dedicated consumer marketing department. All this effort across the UK, supports our targeted marketing on the ground.

DS: Myself, Clare and all of the staff are walking advertising. We love it here and we shout about it. We really want to help and to be a pillar of the community. People can come here and relax on their own or in a group and we encourage people to stay for one more coffee. If the store is good and

the product is good then we have to get the service right and we do.

ID: I’m a big supporter of local store marketing and as such spend a reasonable amount every month making sure customers know where our stores are and what we offer. Obviously I don’t have the same money to spend as the national marketing board but they already do a great job so I don’t have too.

Do you feel that you have support from those at the head of the brand?

EA: Papa John’s has been phenomenal. I very much feel my success is their success and I am looking forward to owning up to 20 Papa John’s stores in the future!

DS: Yes we have had plenty of support and as you can see we have opened under the rebranding so it’s an exciting time to be an Esquires franchisee.

ID: I’m lucky enough to have met Fred DeLuca on 3 occasions, he is the founder and CEO of Subway®. Whilst he is a busy man he always tries to visit the annual conventions across the globe. The head of Europe and the UK teams are always available via phone or email and always respond to requests. Because we are franchised those who are at the top are accountable to us the franchisees so they are all very proactive.

Winter 2015 Food Franchise | 23

industry VOICES

Ongoing Support How much support were you given following the signing of the franchise lease?

EA: Support is a key ingredient when setting up and running a multi-operation franchise like mine. I currently run four outlets and I only joined Papa John’s in the Summer. The team has been instrumental in helping with negotiations on sites and opening plans and providing support wherever I need it. I believe in the brand and the Company’s expansion strategy and am excited to be part of that. However, I’d also be lost without my girlfriend, family and business partner – they often provide a sounding board for new ideas and can sometimes be the voice of reason!

ML: We were offered great support from the outset - the entire team at Harry’s, and in this I’m also including the Directors, have been very helpful - as mentioned earlier, when we were deciding upon our funding package they were able to offer advice and support.

24 | Food Franchise Winter 2015

DS: We received everything that we need for the group and they are there to work with us and guide us through the process.

ID: Every new franchisee gets 2 weeks training in either the UK or U.S. in Subway’s® own dedicated training centre before opening a store, this includes many hours working in a store. You then get help with the store opening along with in store support for around the first 4 weeks.

Do you have regular contact from Head Office?

EA: I am in-charge of the franchise but I have regular contact with Papa John’s head office staff. They are really supportive and the team is there to help me make the most from my business.

ML: Since signing, they have also assisted us in many different ways, including location mapping, which is useful in determining the viability of potential sites – this has greatly influenced our site selection process. In advance of opening our first outlet, we also received great advice in terms of design and marketing and since then, we know that Harry’s

entire network of suppliers is available to us, when we need them.

DS: Yes plenty, we also try to stay in touch with the other franchisees and many of them came to our opening. We are like a family and we communicate well.

ID: Very much so, we attend regular meetings, we visit the conferences and go to the national rallies every year. I have direct contact with all the head office team based in the UK and they are always offering help and advice via regular emails and newsletters.

Is there someone available to offer guidance should you need it and is this support instant?

EA: My Papa John’s business manager is always on the end of the phone if I need to talk to him.

ID: Each store is assigned a Field Consultant who supports and inspects stores on a monthly basis. Their job is also to be on the end of a phone should you need instant advice and support.

industry VOICES

Staff Did you have to take on existing staff following the opening or was it a new premises?

EA: One of the main challenges in opening so many stores in such a short space of time is managing multiple teams of staff. Human beings tend to be a ‘moving target!’ For the re-sales stores some of the staff already worked there but for the new openings we had to recruit and train a whole new team. However, my area manager and our individual store managers are highly motivated to look after our people.

ML: Ours was a new premises, so we had to employ our own staff, however the franchising team were on hand to assist with the interview process, as they have years of experience in this…..the training team from Harry’s then inducted our new team into the brand -this was not only useful in that each staff member was properly trained for their job, it also gave the team a clearer understanding of the history, heritage and iconicity of the brand.

DS: Yes under employment law we had to take on the existing staff and were happy to do so. All we asked was that they embraced the brand and the store and that they left our customers happy. They do that and we have heard nothing but positive reviews.

ID: U.K. Law requires you to take on all existing staff when taking over premises which is what we did with our first store.

For our newest store we hired both internally and externally as it was new premises.

DS: The staff are all very good and can make great coffee, we just had to show them the Esquires way and promote customer service. We didn’t really need to do much, they’re all engaging and are an asset to what we are trying to build.

How much training did you have to give staff prior to opening?

ID: When our new premises store opened we had staff train for 2-3 weeks at an existing store of our own. They were then in the new site for about a week before it opened. This was ample training and the store opened with little or no issues relating to staff’s abilities or skills.

EA: All staff are thoroughly trained, hands-on and through Papa John’s online system, called ULearn. The blended learning approach to training, works well.

ULearn is divided into 12 core modules designed to cover every essential aspect of the franchise. From new team member orientation to developing delivery driver skills, the visual and audio presentations cover all the necessary areas. Relevant staff also complete the Food Safety Level 2 certification.

Because personnel are certified once they have successfully passed the test at the end of each learning module, I can monitor the progress of training easily.

This is particularly helpful as I am managing multiple teams.

In addition, because the system is online, it is easily updated. This is important when we are introducing new recipes for example. It allows us to communicate to all staff how to make the new pizza on a step-by-step basis, ensuring the consistent high-quality of our products.

Does the brand offer any training for new staff or is the franchisee responsible?

DS: The training and information is more for myself and Clare. The job is simple.

We sell quality products in a clean, safe and friendly environment. But yes there are opportunities to learn and grow with Esquires.

ID: The Franchisee is entirely responsible for training employees in store on a day to day basis. However Subway® provide a comprehensive package of training online called University Of Subway®. This is an incredible system which provides videos, text and exams on all aspects of being a Sandwich Artist™. The main UK office also offers regular training weeks for store managers which is something I send all my managers on. FF

Winter 2015 Food Franchise | 25

business profile

HARRY RAMSDEN’S FRANCHISE At Harry Ramsden’s we’re world famous for our fish and chips - not just because we’ve been serving them for over 85 years, but because the great taste of every portion keeps our customers coming back for more, every time.

We’re proud to be a quintessentially British brand, serving high quality food at great value prices – with our classic offering of fish and chips complemented perfectly by new menu development, keeping our brand ahead of the curve with emerging markets.

Harry Ramsden was a stickler for quality, and today we continue his tradition of

26 | Food Franchise Winter 2015

setting high standards. We still closely guard the secret recipe of Harry’s famous batter, which is freshly mixed every day to ensure the consistency is just right to complement our delicious fish. We also strive to make the perfect chip with carefully selected, British potatoes, chipped daily: it is this dedication to continuing the

traditions of our founder that helps us to keep serving up the tastiest fish and chips in the world. We’re proud to be feeding many past and future generations to come.

With 26 outlets throughout the UK and Ireland, every restaurant, take away and quick service restaurant (QSR) adheres to the same high quality standards set by

business profile

Harry Ramsden himself in 1928, ensuring that we remain Britain’s best loved fish and chip shop brand.

Financials The minimum investment for a Harry’s franchise is £250k. The licence fee will be between £20k and £30k +VAT depending on the size of outlet. The rest of the investment goes towards equipment, tills and fitting out of the unit. A high initial investment but solid long term profits.

Operating profit for a typical ‘local’ is between £50k and £100k per year!

Why Franchise With Harry’s?

As the brand most closely associated with fish and chips globally, and with Britain as a nation spending in the region of £1.2 billion on the dish annually, we plan to leverage our number one position in the fish and chip industry to become a dominant force in the food service sales league.

With plans to increase our food service sales tenfold and have an international presence within the next five years, now is the perfect time to become part of the Harry’s family.

Franchisees will have access to: • Ongoing Director level input • Harry Ramsden’s full suite of Operations, Franchising and Brand Manuals • Bespoke staff training • Pre and post-opening support • On-going business support and development • Regular review meetings • Marketing, guidance and consultancy • Ongoing menu development • Access to supplier base with purchasing benefits from the Harry Ramsden’s buying power • Assistance with Finance Arrangement In addition, we’ll be happy to assist you in finding a suitable site – and will be with you every step of the way to opening your Harry’s franchise, and beyond – continuing to support you when you’re up and running, too.

be entrepreneurial people who believe they have what it takes to set up their own business, are passionate about the Harry Ramsden’s brand potential, and importantly - who deliver.

We are looking for: • Customer Focus • Honesty, integrity and commitment • Proven multi-unit operator • Net worth and liquidity to fund multi unit launch • Strong regional/local market knowledge

I’m Hooked!

Tell me more at www.harryramsdens.co.uk or contact Chris on 07581 325175

What Makes A Great Harry’s Franchisee?

Responsible for the successful operation and marketing of the store at a local level and in maintaining Harry’s high standards at all times, Franchisees will

Winter 2015 Food Franchise | 27

ONE to watch

One to watch Beer Dock Stemming from an idea first hatched across the Atlantic in the mid ‘70s, ‘Beer Dock’ is finally here and in this issue of Food Franchise Magazine we look at one of the most exciting new opportunities in our ‘Ones to Watch’ feature.

Tracing the story back to 1977 and a chance trip to the Beerdock with his uncle Sherman, Chris McGarrigle tells Food Franchise just how his idea turned into reality.

and it was a place to buy in bulk.” he said.

“The place and crucially the name stuck with me for over 30 years and I knew that one day I could replicate the idea over here.”

“Beerdock was the generic name for the off licence and in reality it was a large warehouse, it wasn’t glamorous, there were pallets lining the cold, concrete floor

Jump forward to June 2013 that dream became a reality when Beer Dock opened their doors in Crewe under the watchful eye of Chris and his son Sam.

28 | Food Franchise Winter 2015

Housing over 1000 types of craft beer, cider, stout, porter and real ales, the concept here is unique and both Sam and Chris have a personal mission to make sure that all of their customers find what they are looking for, their knowledge that they possess is second to none.

Beer Dock is the kind of place you can go for an education, much like the work of a

ONE to watch

demand and the ever-growing interest in craft beers. If there were to be one area that has posed a headache for the team it is in the logistics and storage department where buying power is limited by the current size of the business.

The team found that of all the independents that they source their beer from, most wanted to see to them in bulk.

With such demands it is obvious that there will be storage and logistical problems. The only real solution therefore was to expand and offer franchises.

fine sommelier serving wine, these guys know what they are doing when it comes to beer. With both an on/off licence they can even serve you a beer in store from one of 6 beer lines.

As many new businesses discover there can be teething problems and since the initial opening, those at Beer Dock can consider themselves lucky having not found many. This is largely due to market

Fast-forward 18 months from opening day and Beer Dock have successfully negotiated property in Altrincham, in which they will open a second company operated store and their first official franchise will open in the next few weeks in Nottingham. There has also been plenty

Winter 2015 Food Franchise | 29

ONE to watch

of interest shown in the concept nationally with Chris taking “regular calls” from people in Stoke-on-Trent, Northampton and Bristol about the possibility of opening a Beer Dock.

This growth will put to bed the storage and buying difficulties and will no doubt see this business expand.

Talking about the franchise opportunity in his exclusive interview with Food Franchise, Chris said: “This is a great franchising opportunity; we are unlike other franchises as we do not ask for a franchise fee to start with.”

“Obviously we have the protection in place to ask for a fee at a later date but at the moment we want to get the right people through the door, those people with the same passion and drive as us.

“We really feel that this offers us the best chance at realising our goals and bringing

30 | Food Franchise Winter 2015

the Beer Dock to the UK market on a national scale.

“It has been hard work and Sam puts everything into this, it’s his shop and his project, I’m just here to give him the odd nudge” he added.

“We are always looking for new franchisees and new properties. At present we have our flagship store here in Crewe and have secured the lease for another company owned store in Altrincham.”

“Our first franchise will be open in the coming weeks at a site in Nottingham and it presents a great opportunity, it’s the first step of many and hopefully it will offer us the platform for growth that we need.”

“There are two main difficulties that we face the first of which is buying power and the second is storage. We are sourcing the beers that we sell for, small, independent breweries.” FF

franchise viewpoint

In-Store Marketing Here in his regular column, Subway franchisee, Ian Dawes, gives the lowdown on marketing a franchise

Subway will be turning 50 years old during 2015, quite a milestone for a company started by a college student wanting to support himself through his education. Through the years the brand has honed its marketing skills and perfected how it sells itself in store to the paying public. As part of my franchise agreement I am provided with all in-store advertising materials including tent cards, menu panels, flyers, posters and leaflets etc.

This is all expertly designed, uses beautifully taken photos and is well thought out. So that’s all I need to do to sell Sandwiches to my customers, right? Subway always encourages its franchisees to go above and beyond and provide the best possible customer service and they love to promote the concept of local store marketing. As a proactive businessman I don’t want to rest on my laurels and just take what Subway offers and do nothing else, I need potential local customers to come to my store and not the one down the road or a competitor.

However marketing is sometimes mistaken for advertising and these are 2 different things altogether, marketing is all about promoting what you already do really well and converting it into sales. Below I have offered a short list of what I think is the best way you market yourself well in-store • Answering the phone.

How do your staff answer the phone? Do they just say hello or are they creating a friendly welcome and listening to what

customers have to say? Phone calls can convert to sales so make sure staff are trained how to deal with customers and take orders.

• Greeting your customers.

Welcome every customer as though they have just given you a £100, because eventually they will, by making repeat visits to you.

• Cleanliness.

Is your store perfectly clean and well kept?

Is the outside of your business looking the best it can? Dirty and untidy stores aren’t appealing and considering how much competition there is these days you need to be a cut above the rest.

• Hygiene.

When customers walk in to your store can they see the food being prepared hygienically and in a safe manner? Are staff wearing gloves and is their uniform looking clean, failure to keep standards up may mean customers never returning to you.

• Point of Sale (POS).

Menus, posters and flyers wherever they are used should be up to date and hold all the right contact details on them. Make sure everything you have made has been proof read by someone else so you don’t make any mistakes.

•F resh Food.

Subway have known this for years now but by freshly baking bread and cookies every few hours we keep the stores smelling great, the food just sells itself! Keep your shop full of fresh smelling food and Coffee, this makes the place more appealing to customers.

•C ustomer Feedback.

We have a great system called Tell Subway which allows customers to give us feedback every visit, they even get a free cookie for completing the survey. Offer customers the chance to complete questionnaires or add a suggestion box to your restaurant. If you don’t know where you going right (or wrong) how can you improve?

Your restaurant or café is the window in to your business, always keep it to the highest standard you can so customers can see how passionate you are. Marketing plans are often written by owners with the intent on spending cash to get people through the door.

Why spend a fortune when a great looking restaurant with fresh food can sell itself, let your customers do it for you by word of mouth!

All written content is the personal view and opinion of Ian Dawes and does not necessarily reflect those of Subway® and its affiliates. All content is correct at time of going to press. FF

Winter 2015 Food Franchise | 31

survey

Growth of food franchising As avid readers may remember, the last issue of Food Franchise Magazine looked at the annual NatWest/BFA franchise survey and explored both the growth of franchising at home and abroad.

In this issue we take a deeper look into the rise of food franchises.

is undoubtedly growing as consumer demand rises.

At present the franchise industry in the UK turns over £13.4bn and employs well over half a million staff. Responsible for a large portion of this revenue stream and a major contributor to employment figures is the food franchising sector, which

Who’s looking to franchise?

32 | Food Franchise Winter 2015

As the UK marketplace recovers from the global economic downturn, many individuals are looking at ways to invest

their hard earned money. There are many options out there from ISA’s and trust funds to pension schemes and investing in property. If these don’t quite tick the boxes then it seems as though becoming a franchisee is proving to be a very popular choice.

Those looking into the world of franchising

survey

are attracted by several factors including, becoming their own boss, the tangible, financial security that comes with managing your own money, rather than placing it at the hands of the banks and the fact that 92% of all franchise models are profitable after just year one. Some individuals also see franchising as an opportunity to try something different or to open up another revenue stream.

Of all these perks the major selling point is sure to be the potential of significant financial gains by investing in a proven franchise model.

Such is the low consumer confidence surrounding banks, financial institutes and the stock exchange, many potential franchisees turn to these established brands and believe that by investing with them, they will be better placed to make a good ROI operating under a big name.

So what next?

When the seed has been sewn and the idea of entering into a franchise agreement is firmly planted in the mind, the next step is to conduct market research as to the type of franchise the investor wishes to become involved with.

As the UK marketplace recovers from the global economic downturn, many individuals are looking at ways to invest their hard earned money.

In order to gain a comprehensive look at the industry and the areas where potential franchisees could benefit from making an investment, Food Franchise Magazine has again embarked on dissecting the information published the study by NatWest on behalf of the BFA (British Franchise Association) as well as conducting our own research.

The study highlights that presently the UK franchise market is split into six sectors, each of which, shows significant growth over the last 20 years. These sectors represent the 930 franchise systems currently in place in the UK and the 37,000 individual business sites that are attributed to these franchise models.

These sites can be either independently owned as a one off franchise, or by a franchisee who owns multiple sites. The sectors are as follows.

Hotel and Catering – (22% of all UK franchises belong to this sector) this sector includes, hotels, coffee houses, QSR’s, restaurants and pubs.

Store Retailing – (14%) Examples of these types of business include furniture centres, clothes shops and travel agencies.

Personal Services – (23%) Personal trainers, pet grooming services and private tutoring are all part of the personal services industry.

Property Services – (17%) estate agencies as well as maintenance, cleaners and gardeners feature in this area of the franchise market.

Transport and Vehicle Services – (8%) This sector covers those we rent or repair vehicle and couriers.

Number of uk franchise systems over time

Winter 2015 Food Franchise | 33

survey

Business and Commercial Services – (16%) Including accountancy, recruitment, printing and the supply of training and office products.

Profitability and Growth within the UK Market Looking at the figures it is fair to say that the contribution of franchising on the UK economy is a significant one. Since the start of the recession in 2008, there has been a net rise of 11% in the total number of franchising systems that are in place.

82% of these are UK owned and run whilst the other 18% are either run under the umbrella of the parent company (9%) or as a master license by the company that owns the system (9%).

In order to further boost the economy, both the government and UK business owners are continually looking to promote and export these franchise models and at present 25% of UK franchise systems have been successfully exported.

Looking further into these statistics we can see that the hotel and catering sector in second only to the personal services sector in terms of number of units. This is because franchises in these areas have

strong branding and have the buying power to offer high profits to those operating them. Those taking a long term view of the state of the industry will note that these two areas provide the drive and the stability that franchising needs, and are sound investments as the marketplace recovers from economic suppression.

If we take the number 930, which relates to the actual number of parent companies who offer franchise opportunities in the UK, 132 are in the Hotel and Catering sector. This equates to around 14%. The growth in this sector is also strong with the number of opportunities growing from 116 in 2000 to 132 (+13%). What is more impressive however is that in this time, the 16 new franchises have contributed heavily towards providing 2500 new units, which equates to a 43% increase for the industry.

Out of the previously mentioned 930 franchise models and the 37,000 individual franchise premises in the UK, the largest nine franchisors, which includes Subway, McDonalds, Domino’s Pizza and Star Pubs and Bars (Formerly Scottish and Newcastle) control 9244 units (24%).

Of the 9 companies that currently own in excess of 500 stores in this country, five are in the Hotel and Catering portion of the market, six if you include Dairy Crest.

Costs When it comes to buying into a franchise one of the main stumbling blocks may be raising the capital to meet the franchisors price. Of course the bigger the business

Investing in a franchise rather than placing your money at the hands of the banks is wise as 92% of all franchise models are profitable after year one.

Scale of systems by unit number

34 | Food Franchise Winter 2015

The Big Hitters

survey

the larger the initial investment but the greater the potential return.

One of the ways to make the deal sweeter or more profitable over the long term will be for the franchisee to pledge to open multiple sites.

When looking a food franchise there are two types of costs that must be considered, they are the initial costs and the ongoing costs. In truth these two areas of finance are the same whether you are setting up a franchise or an independent business. The key difference and the added value comes in the initial costs stage, when branding, shop-fitting, accountancy, legal and support are all provided as part of a package, increasing efficiency and reducing outgoings.

Initial Costs – When looking at the initial costs of setting up a food franchise the first this to consider is the price and the second is the perceived value of the product or business compared to others.

As you may expect brands such as Subway, McDonalds and Domino’s Pizza all carry a hefty price tag at the initial stage but you are buying into a large, well branded, hugely recognisable multi-national.

By looking at the setup cost on different levels it is possible to highlight not only market potential but the value between brands. Those franchise opportunities that sit atop of the pile such as McDonalds and Subway do so at a premium price.

Going into business with either of these market leaders will cost you a minimum investment in the region of £125,000 with prime locations in London and other major cities costing around £325,000.

To secure one of these franchises can be quite difficult such is the demand, indeed one property lease specialist, Morris Greenberg said: “Franchising is now a boom industry and competition to get into something like McDonald’s or KFC is ferocious.

“The rewards are spectacular if you have the cash to buy in and are prepared to work your socks off for three to five years.

“Franchises, providing they are in the right place and run well, are a passport to millionaire status. London has the prime

sites that everyone is after but we will be seeing more and more of them on every high street over the next few years.”

If you get past the due diligence and can find a new site (please note resale’s are different) brands such as McDonald’s will ask for at least 25% of the franchise fee up front and without borrowing, the rest may be finances but further checks will be made aside from those made by the lenders.

Ongoing Costs – Ongoing costs are nothing new in the world of business and range from buying in stock, paying rent and rates on a property and to cover the salaries of your employees. In food franchising there will be the franchise fee to consider as well as any repayments that need to be made on loans taken.

As a franchisee you will also be responsible for contributing to the company’s marketing budget but industry experts shows that even the average rate of 4% shows a good yield for individual store owners.

at the markets and individual business sectors it is always the food industry which comes out on top in terms of high end turnover and revenue potential. Of the six different sectors that have been identified within the franchise world 73% of businesses in the Hotel and Catering sector is consider their turnover to be high or very high. In comparison the second placed sector is Store Retailing which sees around 61% of their franchises falling into these turnover bands.

By applying a rolling average over a threeyear period the Hotel and Catering sector sees nearly half or all units achieving annual turnover of £500k+.

Time held franchises or franchises that have been under the same management for over two years can be predicted to have an 80% chance of being profitable.

Between 3-4 years franchisees typically find that they need to increase their outgoings on marketing to remain competitive, this expense in not reflected in the ROI as around 89% of franchises are profitable during this period. After

Since the start of the recession in 2008, there has been a net rise of 11% in the total number of franchising systems in the UK.

Return on Investment The large amounts of money that are talked about when starting a franchise can be daunting and it may be that there are some models that are out of the potential franchisees price bracket. Another factor that is often forgotten is that many people have to give up work in order to take up a position working for the franchise. The process of setting up and licencing a store as well as receiving and giving any training can be expensive and time consuming, but there are positives in the long term.

One of the key selling points of opening a food franchise is the possibility of a high return on investment (ROI). When looking

five years in the same location 92% of all franchises are considered fully profitable.

These figures show a marked difference in the evolution of franchising, back in 1990 the success of a 5+ year business was only 70%. On current trends within the food franchising industry there is a 43% chance of a franchisee being marginally profitable in their first year, a 44% chance of being quite profitable and if entering the correct market at the right time a 5% chance of being highly profitable.

Of the franchises that are loss making very few fall into the Hotel and Catering sector, this is due to the fact that those

Winter 2015 Food Franchise | 35

survey

with a turnover of less that £50,000 per annum tend to be the loss makers and these types of businesses simply do not exist in the sector. In fact only 3% of all food franchises turnover 50,000 or less and these are usually small, independent, mobile units, paying only one member of staff.

Marketing When it comes to the marketing a business in the food industry there are both pros and cons. The key dangers are that geographically some markets can become saturated and with big brands vying for the larger franchisee fess and the high street stores there is little room for the independents. There are also hidden costs such t advertising budgets, the production of flyers or other promotional materials and the time taken to employ someone to monitor and engage on social media.

By choosing to go with a franchisee you automatically have 90 of your marketing covered. First of all you could be the owner of the high street units secured by the franchisor and you would have access to the branding they provide. You would also pay a marketing fee, (around 4%) to the franchisor towards their marketing budget, thus gaining regional and national media coverage in some of the prime locations across multiple platforms.

Risk and Reward When it comes to risk and reward in terms of running a food franchise the disparity between to two is fairly large. Investing in a food brand and operating a store or stores under that brand is amongst the safest area to invest in the franchise industry.

Consumer spending is high in this sector of the market and it goes without saying the importance of eating. The latter point is further diversified when you consider modern eating habits, where convenience, variety and speed are all key factors. QSRs and food franchises tick these boxes and offer the opportunity to eat a range of meals at a range of times from breakfast, lunch and dinner to brunch and midafternoon snacks.

36 | Food Franchise Winter 2015

Committing yourself to a franchise for a long period of time may be seen as a risk in some sectors, many individuals feel that the market may be saturated. There are some franchises such as gardening and pet grooming services, which rely on a recommendation and their potential to earn is capped by consumer interest.

Coffee houses which many see as ‘ten a penny’ however are in a strong place, the convenience and reliance on passing trade means that stores remain busy despite competition for other brands on the high street.

When setting up a franchise the risks are always important to evaluate. In food franchising the financial risks are the lowest throughout the industry, just 2.3% likely to meet commercial favour. The initial spend on the franchise fee bring this figure down further as the price goes up. An individual spending in excess of £200,000 could expect only a 0.4% chance of commercial failure.

The number of food franchises rises every year with just 10% (3700) of existing properties closing. Whilst this may seem like a high figure the reasons for closing are nearly all (78%) down to personal reasons.

The common reasons for closing are: 901 (2.4% of stores per year) Retirement 849 (2.3%) Commercial failure 680 (1.8%) Ill health 677 (1.8%) Other 417 (1.1%) Realising investment 168 (0.5%) Business dispute

Overview As we have already mentioned the state of the franchise industry is good. More and more businesses are deciding to franchise their business models and through both social media and clever marketing campaigns these businesses are able to build their brands. The strength of this branding is turning regular, everyday people not just to invest financially but emotionally. As a nation we are putting our trust in brand and social spending habits and realising that there are plenty of exciting opportunities.

When it comes to food franchising we can see that consumer spending is up and that there are tangible returns to be made from running a business in this industry. Now is a very exciting g period for the market and with economic parity returning to the highs of the mid 2000’s, investing in such a business could yield a good ROI. FF

When it comes to buying into a franchise one of the main stumbling blocks may be raising the capital to meet the franchisors price.

£13.4bn

UK franchise industry turns over £13.4bn

92%

92% of all franchise models are profitable after the first year

22%

22% of all UK franchises fall in the Hotel and Catering market

11% 2008 25% 9244

37000

Since 2008 there has been a net rise of 11% in franchising - 82% of these are UK owned and run 9 out of the 930 franchises options available are responsible for 25% of UK market.

Between them they own 9244 of the 37000 single units

73% of businesses in the Hotel and Catering sector consider themselves ‘highly’ profitable

>500k 37 | Food Franchise Winter 2015

50% of those in the H&C market report annual turnover of over 500k

Accountancy

What should I invest in?

Every month, Peter Watters, ACA, shares some useful financial tips especially for Food Franchise readers. This month, he looks at investments. Which is the right investment vehicle for you to consider?

As each has its own features, choosing the one - or even two or three - that’s right for you could bring additional benefits to your investment strategy.

Shares If you invest directly in shares you are holding a small part of a company and will benefit financially if it is successful, through an increase in the share price or by dividends.

Shares are purchased through a stockbroker or an online share dealing service and charge around £10 plus stamp duty of 0.5 per cent of your investment.

However, shares listed on the Alternative

38 | Food Franchise Winter 2015

Investment Market (AIM) are free of stamp duty from 6 April 2014.

Advantages • You can choose which company shares to buy.

• As a shareholder you usually have the opportunity to vote on some company decisions.

Disadvantages • Lack of diversity - unless you hold a

portfolio of shares your investment is concentrated in one company.

• Dealing charges can make this an expensive way to invest if you are a small investor.

INVESTMENT FUNDS Funds such as unit trusts and OpenEnded Investment Companies (OEICs) are collective investments which allow investors to pool their money together

Accountancy

to create a large fund that invests across a range of different shares and/or other assets such as bonds or property. This is run by a professional manager in line with the fund’s objectives.

are available, so the share price will be affected by supply and demand as well as the value of the underlying assets. This means the shares can trade at a discount or a premium to the net asset value.

You buy units with minimum investments as low as £500 or £25 a month, and there are no restrictions on when you sell. Charges vary depending on the type of fund, but are typically an initial charge of up to 5 per cent with an Annual Management Charge (AMC) of up to 1.5 per cent.

Advantages • Instant diversification without a large investment.

• Gearing means gains can be magnified, although the same also applies to losses.

• Normally lower annual management charge than an equivalent fund.

• Returns can be enhanced if you buy on a discount and it narrows as the trust becomes more popular.

Advantages • Instant diversification without a large upfront investment by you • Investment decisions are taken by an experienced financial adviser • Thousands of funds to choose from investing in equities, bonds and property as well as other types of assets Disadvantages • Management charges can be high.

• The manager doesn’t always get it right.

Investment Trusts An investment trust is a form of collective investment, you buy shares in a company, which then uses the money raised to invest in a range of assets on your behalf. There are some key differences between trusts and funds. Trusts are more sophisticated, and therefore slightly riskier, investment than funds. Investment trusts are able to borrow money, known as gearing, which can help to increase profits but can also magnify any losses in a falling market.

Additionally they are closed-end. This means that a finite number of shares

Disadvantages • Dealing charges can make this expensive for a smaller investor.

• More sophisticated and potentially more risky investment than a fund.

PENSION FUNDS A pension fund operates exactly the same as a fund, a manager investing according to the fund’s objectives, but because it is a wrapper specifically for pension investments, there are some important tax advantages. Subject to earnings and the annual “lifetime pension allowance”, anything paid into a pension fund receives tax relief at the basic rate, effectively topping up an £80 contribution to £100. Higher-rate taxpayers receive tax relief at their highest marginal rate.

Additionally, although you cannot reclaim the 10 per cent tax credit on dividends, all income and gains in the fund are tax-free.

However when you come to take benefits, either as an annuity or when drawing income from a personal pension, these are subject to income tax.

Advantages • Instant diversification.

• Tax breaks.

Disadvantages • Money cannot be accessed before age 55.

VENTURE CAPITAL TRUSTS A venture capital trust (VCT) is a trust which invests in fledgling companies that are looking to develop their business. The nature of these companies means that this is a higher risk investment.

Due to the risk there are a number of tax incentives to encourage investment. These include tax-free income, dividends and gains and an income tax rebate of 30% of your initial investment into new VCT shares, providing you have paid sufficient income tax that year and you hold the shares for at least five years.

Advantages • Generous tax breaks.

• Opportunity to invest in very small companies.

• Income payouts make them very attractive for retired investors.

Disadvantages • Higher risk and more suited to sophisticated investors.

The value of your investment and the income from it can go down as well as up and you may not get back the original amount invested. Past performance is not a reliable indicator for future results.

Please contact us for further information or if you are in any doubt as to the suitability of an investment. FF

Need more help?

This feature aims to give some informal hints and tips. McPhersons Chartered Accountants and McPhersons Financial Solutions are offering businesses free advice so get in touch now to arrange your meeting. Simply email Peter Watters p.watters@mcphersons.co.uk or call our Head Office on 01424 730000 for a free consultation at mcphersons’ London, Bexhill or Hastings offices. www.mcphersons.co.uk Happy New Year to all our Clients and Contacts!

Winter 2015 Food Franchise | 39

market watch

Market Watch Of all the questions that we receive here at the Food Franchise office, a large proportion of them are to do with finance and the safety of investing in businesses in this sector. With that in mind we decided to start a new, informative feature, looking at the global financial markets and how the food franchises that are listed perform.

Share in Focus Papa John’s International Inc (PZZA) It’s hardly surprising that this issue’s share in focus is that of Papa John’s (PZZA). Over the last six months the food franchise industry has seen real growth from their representatives on the stock market with QSRs and food-to-go outlets doing particularly well. Of those that are having something of a purple patch it seems as though those serving up pizza are also the ones serving up the biggest returns for investors.

Back in September Papa John’s were trading at a year low of $37.65 an

40 | Food Franchise Winter 2015

investors saw their stocks gently fluctuate up and down, fast forward five months and the picture could hardly be better. PZZA is currently trading at $57.75 which reflects not only a year high but a historical high. This up of nearly 52% and of over 40% in the last quarter shows the strength of the brand.

It is thought that much of the success has been due to a mass marketing campaign in the US and a steady growth in the number of international franchises.

Over the last few months the UK has seen countless stores open in largely

populated areas. The franchisees involved have taken the fight to the market rivals and on many occasions these franchisees have become multiple premises operators.

The weeks ahead will be very important for the company, who will have to compete against lower than average consumer spending. If they come through the early months of 2015 in a similar position to that which they currently stand then this will defiantly be one to watch, and growth will be expected.

All information correct as of 06/01/2015

market WATCH

Papa John’s PZZA

+40% Domino’s DOM

+24%

Yum Brands YUM

-0.7% Marstons MARS

-1.2% McDonalds MCD

-1.7% Dunkin Brands DNKN

Hot/Not In order to give our readers the most accurate overview of the ever-changing markets, we look at how certain stocks have performed over a three month period and rate them accordingly on our Hot or Not chart.

Papa John’s International Inc (PZZA) – In order to make the dough it seems wise to invest in the dough. Just like Domino’s (DOM) Papa John’s (PZZA) has seen their share price soar. At the time of writing (PZZA) is the best performing stock on this list seeing its price rise from $40.79 to around $57.39, a 40% increase. This is definitely top of the stocks.

Domino’s Pizza Group plc (DOM) – It is no secret that this stock is one of the hottest on the market at present and with investors queuing up to grab a slice of the US firm it is little surprise that their price has rocketed. Starting October at 566.00p, the group posted a good set of quarterly figures and were further boosted by a strong UK performance, largely thanks to improved economic figures on the whole. The result sees (DOM) starting 2015 at around 700.50p, representing a 24% gain.

YUM Brands Inc (YUM) – It been an interesting year for YUM Brands, who look after the interests of franchise opportunities, Pizza Hut, KFC and Taco Bell. Back in July the company found their share price sitting at a year high of $83.45 before a Chinese food scare saw their price slump to $69.40 in just two weeks.

Since then the ship has steadied and shares in (YUM) have moved from $71.38 to $70.88 representing just a 0.7% loss.

Marston’s plc (MARS) – Following a shake-up in licensing laws and scrutiny over whether or not the pub companies could tie their tenants down to buying from them, this area of the industry looked set for a lean period. Over the last three months however Marston’s have weathered the storm and show just a 1.2% loss on their market price. In October they were trading around 142p and at the start of 2015 find themselves at 140.30p. There is room for optimism with this share as trading for the quarter has twice surged towards the 150p mark.

McDonalds Corporation (MCD) – Back in early October McDonalds were trading at around $93.84 and currently sit at $92.23, representing a 1.7% loss. This however, doesn’t tell the whole story with the fast food giant battling against a loss of sales. In December it was revealed that global sales were down 2.2% whilst sales in the US slid 4.6%. As a result the firm has seen their price fluctuate significantly with a three month high of $97.17 and a three month low of $88.46.

Dunkin Brands Group Inc (DNKN) – The company behind Dunkin Donuts and Baskin Robins has been trading at a steady pace this year and were looking to post strong, annual figures until well into the last quarter. A quick-fire slump over the space of a few short days in December the group saw their stock fall nearly $5 from $46.22 to $41.99. At the time of writing the group were clawing back the gap and finished in $42.47 - still a decline of 5.5% since early October. FF

-5.5%

Winter 2015 Food Franchise | 41

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food review

THE CHERRY TREE In this issue Trevor Langley takes a look at specialist produce franchise, Cherry Tree Preserves.

For this quest, I searched for a wellestablished company, producing a very good range of high-quality chutneys, pickles, cheeses and preserves, including different, interesting curds, jams and marmalades, etc. I located a company which is constantly introducing new and very popular luxury products. With excellent opportunities to accommodate new franchisees, Cherry Tree Preserves has a most impressive franchise brochure.

Cherry Tree multi award-winning products are very popular and offer real value for money. Their high-quality productions are renowned and well-respected. They are recognised by their traditional look and distinctive Cherry Tree logo, and certainly, the wonderful tastes.

The Cherry Tree range of splendid curds includes not just the usual Lemon, but Passion Fruit, Pineapple & Coconut Liqueur and Sticky Ginger, amongst others. Popular ‘different’ jams include Blackcurrant & Sloe Gin, plus Finest Apricot. Morello Cherry, Pear & Ginger are superb, along with many more. Cherry Tree jams are made from the finest fruits and have great flavours. Splendid marmalade temptations have Ginger Marmalade, Pink Grapefruit Marmalade, plus several others, including Whisky Marmalade, to tantalise the palate.

Chilli Jam is a fabulous jelly, which includes high-quality chilli peppers and ground black pepper. This makes a great accompaniment to many meats and salads, etc. There are some really impressive chutneys in the Cherry Tree range of products too, and

these are great additions to numerous dishes. From Real Ale Pickle, Hot Garlic Pickle and Piccalilli, through Caramelised Onion Marmalade, to Spicy Gooseberry with Fresh Coriander and more, there is something for all tastes. The Horseradish Sauce is a real favourite and a classic with roast beef.

If enthusiasm and a passion to succeed are a driving force, along with a desire to own a business, then the Cherry Tree organisation is very worthy of consideration, indeed.

I am particularly impressed with the ongoing support which is available and the opportunity to include new products, regularly. All information can be located on their website, plus recipes and online shops, etc.. FF

Winter 2015 Food Franchise | 43

BE INSPIRED

Be Inspired At Food Franchise Magazine we are always looking to provide our readers with new, exciting content and in the case of this piece, something personal and inspirational. In this issue we speak to BFA Young Franchisee of the Year winner, Aaron Stewart.

Rotherham-born Aaron, 29, scooped the prestigious honour at the HSBC Franchisee of the Year 2014 awards back in October and the success that got him nominated in the first place has continued, as his ambitious business

44 | Food Franchise Winter 2015

rolls on with the help and support of pub group, Marston’s.

When talking about the award Aaron said: “I was baffled, I couldn’t believe that I had won it.

“It was a real honour to have been nominated and to be in the top three.

When they read out my name as the winner, I was both was delighted and confused, how could this happen to me?”

If we trace the story of Aaron back to the

BE INSPIRED

early days, the young businessman got his first taste of the pub scene whilst working as a 14 year-old in his aunt’s pub at home in Rotherham.

As his passion for the industry grew he decided that his future career would indeed hinge on the licensed trade and after successful stints with other large pub groups, in which he won the title, “Pub Manager of the Year” on several occasions, he decided that it was time to become his own boss.

With that, Aaron contacted Marston’s about their franchise opportunities and hasn’t looked back since with his career in the industry now spanning over a decade.

He currently operates The Goodfellowship in Hull, The Fairway Inn, in Sheffield and most recently The Rufford in Mansfield. There can be no doubt that Aaron is a thought leader and he is very vocal in the support of franchising as a business model.

“Franchising offers such a good opportunity, especially in this industry, in my opinion it is far better than becoming a tenant,” he said.

The remarkable growth shows no sign of stopping either, as Aaron plans to continue expanding his portfolio.

When we asked him about the growth of his business he said: “The ambition has always been to have 10 pubs and I feel that working with a brand like Marston’s this is very achievable.

“The confidence that I have gained from winning the award is huge and my team are also very motivated by it.

place, Aaron has more than doubled the turnover there and is making similar inroads with his other properties.

“Next year I will try to retain my title and my staff will be going for the Customer Service award.”

When asked about the support that he receives from the brand, Aaron said: “Marston’s are great and the concept of franchising has allowed me to grow rapidly, I am able to really concentrate my efforts on the pubs as most of the admin tasks are looked after.”

The added time that the partnership allows Aaron, has meant that he can concentrate on ‘dreaming up’ new ideas and ‘trying them out.’

Aside from his honour at the Franchisee of the Year awards, Aaron can also boast

“When they read out my name as the winner, I was both was delighted and confused, how could this happen to me?” about the fact that he is the youngest Marston’s franchisee and that his pub, The Fairway, is now the best performing pub in the group.

Thanks largely to his efforts and the team of 115 staff that he has put in

One of his most successful is the £999 wedding package offered at the Fairway, which provides a full range of services for those on a budget.

In seems that aside from his hard work and dedication, Aaron has enjoyed a fruitful relationship with his franchisor too, with Marston’s Operations Manager, David Price, going on record to say: “We are delighted that Aaron has won his BFA award and very proud of his achievements, particularly at such a young age. Aaron is very hard working and totally committed to his business.

He really does deserve to do well.”

Aaron’s future plans should see him open up his fourth pub in March this year and we wish him well in his ventures. FF

Winter 2015 Food Franchise | 45

franchise finance

WANTING YOUR OWN BUSINESS Franchise finance expert Chris Roberts guides you through the process of starting your own business.

Wanting your own business is the dream for many people but the reality of the situation can mean you end up confused and alone, responsible for everything from dealing with difficult staff personnel matters to ‘wrestling’ with the accounts.

You really do need to be a ‘Jack of all trades’ and that isn’t easy if you don’t have

46 | Food Franchise Winter 2015

the appropriate experience, training and /or support. That’s why more and more people are turning to Franchising, because if you choose a good Franchise, you will get plenty of training, support and of course you will actually achieve your goal of being ‘The Boss’ of your very own business.

The reality is that you will be given all the

tools you need to run a successful business and providing you follow the model and put all your energy into the process you are likely to be successful. That is as long as you don’t run out of cash!

Only you can control this so don’t leave it to chance. Be aware of what is happening

franchise finance

in your business. How much money you have and how much money you need. It is your job to find a way to ‘balance the books’.

So if you are new or relatively new in business, here are some tips and hints to help you.

Let’s start with some fundamental points: You are about to set off on a business journey. You need to be clear in your mind what your destination is and then plan your route accordingly. So what are your business objectives and how are you going to achieve them i.e. you need to set out your business strategy.

The next step is to create a financial plan around this strategy. Your financial plan should have three main parts to it:

can actually afford to do what you are planning to do.

The projected Balance Sheet tells you in advance what your business will look like in the future in terms of its assets and liabilities, i.e. what your business owes and what your business owns.

Having now properly planned and started your business journey you then need to make sure you are staying ‘on track’.

You cannot really manage your business performance properly unless you regularly measure how well you are doing. This is the next fundamental point. You need to monitor your business performance as you go and take the necessary corrective actions to ensure profitability and even more importantly that you don’t run out of cash.

Trend analysis will also help you to change your plans or route along the way because you will soon learn that your business will be influenced by many outside factors The projected profit and loss account, as the name suggests, tells you whether you are likely to make a profit or a loss and therefore whether it’s worthwhile doing what you want to do the way you are planning to do it!

The Cash Flow Forecast tells you how much cash you will need, each month, in order to stay on course and whether you

Using your bookkeeping system to create monthly (or at least quarterly) management accounts will help you to do this. You can then look at trends to spot problems before they become too serious (e.g. negotiate longer credit terms or increase an overdraft facility).

Trend analysis will also help you to change your plans or route along the

way because you will soon learn that your business will be influenced by many outside factors which you will not be able to control. Your plan, therefore, should be flexible and not ‘cast in stone’. So from a positive perspective be prepared to take advantage of any unexpected opportunities that crop up, e.g. a competitor closing down or a sudden upturn in the economy. However make sure you have worked through the ‘cash’ consequences of your actions as there can be a big difference between ‘potential profit’ and ‘actual cash’.

So, in conclusion, what are we saying? You want to be ‘The Boss’ and to run your own business and you want to be successful.

Well you will be, if you start with the right ‘mind-set’ and remember the following: Invest in some appropriate training (such as our ‘Understanding Business Finance and Accounts Course’) to ensure you have the skills you need.

Decide on your business objectives and plan your strategy.

Build your business and financial plan around this.

Don’t be a ‘Busy Fool’! – Make sure the business you do is profitable.

Measure and monitor your progress against your plan.

Always remember: ‘Turnover Is Vanity, Profit Is Sanity and Cash Is Reality’.

So now, when or if you have your own business and you are ‘The Boss’ you now know what to do! FF

The author of this article, Chris Roberts ACIB QFP is a director of Franchise Finance which runs various financial training courses and workshops and also prepares Business Plans and Business Health Checks for franchisees and franchisors. The company, which is an affiliate of the British Franchise Association, has a 95% success record in raising funds for their clients and is recommended by all of the UK Banking affiliates. See their web site www.franchisefinance.co.uk for further details.

Winter 2015 Food Franchise | 47

Bank of england

Protecting your business against counterfeit notes There are currently around 3 billion Bank of England banknotes in circulation with a value of around £56 billion. This large amount of cash inevitably attracts the interest of criminals, who make and distribute counterfeit notes with the aim of defrauding retailers and businesses.

In the first six months of 2014, around 233,000 worthless counterfeit banknotes were removed from circulation with a nominal value of around £4.2mn.

Whilst this is only a tiny fraction of 1% of notes in circulation, it demonstrates that counterfeits are a problem and businesses that handle lots of cash are at risk. Failing to spot a counterfeit note could cost your business money and it could also have a damaging effect on your reputation if given out as change.

Criminals often target businesses when they are busy and have less experienced members of staff working. They will usually buy a low value item with a high value note, which means they get away

48 | Food Franchise Winter 2015

with stock and genuine cash from the till.

To help protect businesses, counterfeit detection should be a standard part of loss prevention practices. Staff should be trained on how to check banknotes, ensuring all banknotes being passed in transactions are genuine with procedures in place if staff suspects a banknote is counterfeit.

hand it back and ask for another method of payment.

Generally, if a counterfeit note is suspected or discovered, businesses should retain the note to give to the police, and ask for another method of payment. However, never put yourself or staff at physical risk. If uncomfortable, simply say you are not accepting the note,

• The feel of the paper and the raised print • The watermark • The holograms on the £5, £10 and £20 banknotes • The metallic thread • The motion thread on the £50 note

Genuine notes can quickly be identified by using the security features on banknotes whenever they are being passed in a transaction. Don’t rely on checking just one security feature, check a few such as;

Bank of england

To help, the Bank of England provides a range of free training materials, including a Banknote App, booklet, posters and deterrent sticker, which can all be ordered from our website www.bankofengland.co.uk/banknotes.

Our online film and computer based training course are also available via our website.

There are other tools available to help check banknotes such as counterfeit detector pens and ultra-violet (UV) lamps, more details on these can be found in our ‘Take a Closer Look’ booklet. Further

help is available by using counterfeit note checking machines. The Bank of England has a list of machines that have passed the Bank of England counterfeit checking test on our website at:

www.bankofengland.co.uk/banknotes/ Pages/retailers/framework.aspx.

Counterfeits are rare – let’s work together to keep it that way. FF

Generally, if a counterfeit note is suspected or discovered, businesses should retain the note to give to the police, and ask for another method of payment.

John Kendall, Banknote Education Manager John has been the Banknote Education Manager at the Bank of England for 10 years. The primary role of his team is to encourage retailers and businesses to check banknotes at point of sale. The team also communicates the issue and withdrawal of new and old banknote designs, and they are currently working on the communication plan for the introduction of the £5 polymer banknote in the second half of 2016. The team talks to retailers and businesses at loss prevention events around the country, and they work closely with organisations such as the British Retail Consortium, the National Association of Business Crime Partnerships and the National Crime Agency.

Winter 2015 Food Franchise | 49

diary dates

Dates for your diary Find out what events are taking place in the world of franchising over the next few months

The National Franchise Exhibition NEC, Birmingham 20th & 21st February 2015

The National Franchise Exhibition is the largest franchise event in the UK and is exclusively supported by the British Franchise Association (bfa).

Here you will have the opportunity to meet face-to-face with top franchise brands from a huge variety of sectors including food and drink.

Advance tickets will be free of charge

ScotHot will return to SECC Glasgow for Scotland’s biggest and brightest celebration of Scottish hospitality, tourism and food & drink.

ScotHot SECC Glasgow 4th-5th March 2015

The two day event will welcome a wide selection of businesses and industry leaders and will provide excellent information for those thinking of venturing into hospitality.

Key features at the event include the UK Barista Championships where the best coffee and coffeemakers will be put to the

The National Franchise Exhibition Olympia, London 13th-14th March 2015

IFE Excel, London 22nd-25th March 2015

If you want to attend on the day and do not book in advance, tickets will cost £15 on the door, unless a discount offer code is presented at the exhibition entrance.

Visit www.franchiseinfo.co.uk/exhibition/ register or call the ticket hotline on 0844 257 8668.

test and the New Product Awards which will highlight the finest products in the industry.

There will also be a Spotlight Stage where visitors can view demonstrations, presentations and talks as well as the Staff Canteen Live where some of the UK’s leading chefs, recreate their signature dishes in a highly interactive environment.

For more information visit: www.ScotHot.co.uk

The British & International Franchise Exhibition is the only franchise exhibition in London to be supported by the British Franchise Association (bfa) and only allows franchise companies that have met the Association’s code of ethics to exhibit at the event. This means you can

be confident in the franchise opportunities presented to you, as they are an ethical entity within the UK market.

2015 sees the return of the biennial International Food Exhibition (IFE).

Running for more than 30 years, IFE is back bigger and more innovative than ever before.

The show will draw an estimated 30,000 professionals from across the industry spanning today’s dynamic retail, foodservice and manufacturing markets.

Federation, the Craft Guild of Chefs and Food & Drink Federation.

The exciting show programme for IFE 2015 includes new and inspirational elements, such as The Artisan Food Market and the Gourmet Drinker, featuring the best alcoholic drinks available from smaller producers. The event also welcomes the return and support of the show’s prominent partners such as the British Frozen Food

50 | Food Franchise Winter 2015

if you book them in advance for The National Franchise Exhibition, taking place at the NEC, Birmingham.

Find out more at: www.franchiseinfo.co.uk/exhibition/

Boasting 80 high profile speakers and chefs, the exhibition will also encompass a large number of live culinary demonstrations on The Skillery with award winning chefs Hayden Groves, Damian Wawrzyniak, Mark Greenway and Alan Bird, to name but a few. While live business seminars will offer visitors the chance to gain industry insight from some of the most respected names in food and drink.

Register to attend by visiting IFE’s new look website www.ife.co.uk and follow the action on Twitter @IFEexhibition using the #ife15.

Winter 2015 Food Franchise | 51

20-21 FEBRUARY 2015

ExCeL, LONDON

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