[Small but perfectley formed]

Hi Ian can i ask how did you develope your business in to a brand so that you could fanchise it.

[Mr Bungalow]

Hello Jason,

I would be interested to here the answer to your question from Ian.

Hope to see it soon.

Kind regards.

[Ian Lancaster]

Hi fellers,

Firstly, I had a couple of years off from window cleaning in the late 90's and bought a franchise cleaning out deep fryers in commercial kitchens.  Don't ask me why - I must have been having a (late) mid life crisis

It was a total mistake - after three years I walked away from it and came back to window cleaning......

BUT..........I learned a lot about how franchises work.  I also read Jim Penman's book (Jim is the mastemind behind Jim's Mowing - a world wide franchise with about three thousand franchisees all mowing grass )

Then I took about three years just to think about everything I wanted to achieve, and made notes of every idea that occurred to me.  Eventually I had enough ideas to formulate a plan, and my franchise business was born.

Got to go now - the dog wants a walk.

If you can think of any questions, feel free to ask.

[dave0123]

Ian are all your jobs done by WFP?


I do think your idea is the best so far in the window clenaing industry i belive there are other franchises that dont give you the customers like Ian does.


Could i possibly ask if you charge them for the franchise like with others you can pay many thousends before you start paying your royalties?.

Also how did you franchise the business or is it just a franchise agreement i thought you had to go to franchise solictors to change to a franchised company? but that may not be the case just what i thought.

Dave

[jonnyald]

why didnt the fryer franchise work out ?      when you left,who do you think carried on doing it ?

[Ian Lancaster]

Dave:

99% of our jobs are WFP.  

Of course I charge a franchise fee,  there wouldn't be any point in doing it if I didn't

All new franchisees pay an 'up front' fee, but a lot of that is to cover the equipment, uniform, van signwriting, training and initial customer base.  After that there is an ongoing 'royalty' - a percentage of the franchisees turnover that they pay to us in return for as much work as they want and services such as marketing, round record maintenance, and all the help, advice and guidance that they want.  I also supply pure water and I keep a good stock of spares so they can rely on having spares available as and when they need them.

As to how I franchised the business, I just went ahead and did it.

You don't have to 'go to a franchise solicitor' - as with most things you can do it yourself.  The important thing is to define the relationship - I work for the franchisees, they don't work for me.  That's why they pay me.  That's the difference between franchising and sub-contracting, if the relationship is properly set up, there can be no possibility of the franchisees being deemed to be employees.  The same can't be said of sub-contracting

[Dean Taberner]

Ian,

Could you build a successfull franchise set-up out of £5k a weeks worth of work?

I havent got that.....yet   but was wondering just how much you need.

Dean

[Ian Lancaster]

why didnt the fryer franchise work out ?      when you left,who do you think carried on doing it ?

It didn't work out because the Franchisor didn't give a hoot about the franchisees.  That was my 'lesson no 1' - I decided that my franchisees come first - it is of paramount importance to me that my franchisees are happy and satisfied with the service they get from me.

Also the work was disgusting  I went home every night smelling of chip fat and covered in grease.

The business is still thriving - I see their vans about and it obviously suits other people, just not me!

[ronnie paton]

dean thats about 260k , if they wanted 45k each you have five franchises and some work left for you.

making 20% that over 40k a year.

Ian a question for you.....what happens with the vat???

[Ian Lancaster]

dean thats about 260k , if they wanted 45k each you have five franchises and some work left for you.

making 20% that over 40k a year.

Ian a question for you.....what happens with the vat???

That's right, Ronnie.  When I took on my first franchisee I had about £1,200 a week on my books.  I passed £400 a week to the first franchisee, then started canvassing to build his work load up to the level he asked me for.  When I got there, I took on my second franchisee and gave him £200 a week (leaving me about £600 plus the royalties from my first franchisee) and carried on building his round for him.

And so on.

As to the VAT:  Each franchisee is an independant business owner and so does not qualify for VAT until he/she reaches the limit.  The same is true for me - my turnover is the royalties and franchise fees I receive plus the value of any window cleaning I do myself so unless I exceed the limit I do not have to register.

[ronnie paton]

thanks Ian.

[Ian Lancaster]

Of course, that's what franchising means

[Dean Taberner]

Ian,

Do you have a problem with your guys messing you about with payment?

Is there anything secured on their houses or personal property if they refused to pay you and took the customers on as their own?

Dean

[ronnie paton]

Ian how do you go about making sure they declare everything do you get your loyalties??

[Ian Lancaster]

Ian,

Do you have a problem with your guys messing you about with payment?

Is there anything secured on their houses or personal property if they refused to pay you and took the customers on as their own?

Dean

This is where the agreement comes in, and is why I had it re-written by a franchise solicitor.  They enter into the agreement and are bound by the terms so if they didn't pay or tried to steal my customers I would take them to court.

The real disincentive is that they know they're on to a good thing.  They all have good viable and profitable businesses and we succeed because we are well known and established in our area (Seven sign written vans, lots of local advertising etc).  Taking my customers wouldn't be as easy as you might think, and for them to start again from scratch with no customers would be very difficult.

[Ian Lancaster]

Ian how do you go about making sure they declare everything do you get your loyalties??

I use a certain amount of discretion and common sense.  In my agreement it says that I am entitled to my royalties on everything the franchisee turns over.  In practice I only insist on my cut of the regular repeat jobs that I provide (or that the franchisee acquires in the course of running his business as these are also my jobs as stated in the agreement) .  If a customer was to ask a franchisee to (for instance) clean the gutter/soffit/fascia as a 'one off' then I have no objection to them doing that, and pocketing the money without telling me PROVIDING THAT they still complete the work I provide.  If I were to quote for that sort of work and pass it on to the franchisee then I expect my royalties.

As to doing 'foreigners' on a regular basis - everyone tries it on at least once but sooner or later I find out - the customer will contact us as our number is the one on all the vans and paperwork, so if a 'foreign' customer wanted to contact the franchisee for any reason, they would call us first.  We then find out that franchisee 'A' has been doing a job for X number of months without it appearing on their list.

Whoops

A gentle reminder of what would happen if I were to terminate their agreement usually results in (surprise surprise) several 'new' jobs being declared over the next couple of weeks

[M Henderson]

Would you compare it to renting out rounds?

The difference being they all have the same business name and you provide the van and equipment, support etc.

[Ian Lancaster]

Would you compare it to renting out rounds?

The difference being they all have the same business name and you provide the van and equipment, support etc.

If you rent out a round it is by definition a 'week by week' arrangement with no formal binding agreement and no set time scale. 

The essence of franchising is the Agreement - a comprehensive document setting out all the terms of the arrangement and imposing certain obligations on both the franchisee and the franchisor.  It is a legal, enforceable agreement designed to protect all parties and to establish a strong viable business format.

If you rent a round, you could come and go as you please but if you enter into a franchise agreement it is a long term binding commitment

[John Walker]

Hi Ian

You have povided some excellent advice on this thread and I'm sure you have much more to give.   Time to write a book on franchising methinks and add even more to your retirement pot 

John

[M Henderson]

I used to rent out rounds and had a signed agreement with those renting that they would have to stick at it for a minimum of 6 months.

Like you I also was of the idea that the better you look after them, providing more work etc. the longer they stay and everyone's happy.

Hats off to you, if you are going to create a window cleaning franchise then providing initial work and continuing to feed the franchisee work sounds like the best idea. "You don;t bite off the hand that feeds you" as they say.

I looked into franchising at that time but decided it was going to be too complicated - all the legal stuff put me off.

Its a hassle when people move away or move on and you need to find someone else to take over. Each time it happens the customers are unsettled and the round sufffers. I guess thats where the binding agreement is helpful.

In the end I decided to simplify and packed it in.