The road to recovery issue - Franchise Council of Australia

 
The road to recovery issue - Franchise Council of Australia
ISSUE 62 EDITION 2 2020

  The road to
  recovery issue
  FCA advocacy and
  support during COVID-19
  Preparing your business
  for bounce back in the
  ‘new normal’
  Workplace safety
  and return to
  work strategies
  Commercial leasing
  arrangements
  Building resilience and
  maintaining wellbeing
  Franchise innovation
  case studies

AUS $6.95 | NZ $7.95
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                   ISSN 2652-1237
                  02

                                    OFFICIAL JOURNAL OF THE FRANCHISE COUNCIL OF AUSTRALIA   thefranchisereview | i
The road to recovery issue - Franchise Council of Australia
Control your delivery costs                                                                                               Contents
                                                                                                                                 2     A message from the CEO
                                                                                                                                 4 	FCA delivering for members during COVID-19
          Introducing Stellar, an online hospitality solution that offers                                                        6 	The impacts of COVID-19 on franchise businesses
                                                                                                                                 8     Boom times ahead for franchising?
       3rd party delivery, ordering food through Google, online ordering,
                                                                                                                                 10 	Preparing your franchise business to bounce back in
and order management, that works on any browser, and no need for Redcat POS.                                                           the wake of COVID-19
                                                                                                                                 14 	Poolwerx’ values are driving a dramatic reinvention
                                                                                                                                 16 Five critical steps for managing change
                                                                                                                                 18 Rolling out innovations for long-term success
                                                                                     4                                           20	Commercial leasing during COVID-19
                                                                                                                                 22	Navigating leasing arrangements during COVID-19 and
 How it works:                                                                                                                         beyond
                                                                                                                                 24 	Preparing your workplace for the ‘new normal’
                                                                                                                                 26 Safely getting employees back to the workplace
                                                                                                                                 28 Key areas of focus for franchises under COVID-19
                                                                                                                                 30	COVID-19: the potential impacts of early release of super
                                                                                                                                 32 Keeping up with rapid change at Shoebox Books
                                                                                                                                 34	The psychology of resilience and why it matters
                                                                                                                                 38	Short-term solutions support long-term goals at RAMS
                                                                                     8                                           40 Maintaining franchisee wellbeing in uncertain times
                                                                                                                                 42 A three phase approach to COVID-19 resilience
                                                                                                                                 44	Strategies to support mental health in challenging times
                                                                                                                                 46	Stellar: New technology from Redcat offers struggling
                                                                                                                                       restaurants a lifeline
                                                                                                                                 49 7-Eleven delivers for franchisees & customers
                                                                                                                                 51 Delivering for businesses during the shutdown
                                                                                                                                 54	How to take your face-to-face events online in a
                                                                                                                                       COVID-19 world
 Key features:
                                                                                                                                 56	Baby Sensory pivots to support franchisees through
 •    Delivery - We'll arrange a driver to pick-up your food                                                                           COVID-19
 •    Ordering Food through Google - Your live menu published on Google                                                          58 Franchises demonstrate community spirit during COVID-19
 •    Online Ordering - Via your website                                             16                                          60 Franchise partnership pivotal in planning for resilience
 •    No need for new hardware - Simply runs in your browser
 •    Own your customer data – You can export your customer data and send offers
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                                                                                   Level 19, 567 Collins St Melbourne VIC 3000   E editor@franchise.org.au                            of advertisements for products or services does not
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                          www.redcat.com.au/stellar                                T 1300 669 030
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                                                                                   E info@franchise.org.au                       Peter White, Franchise Council of Australia
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                                                                                   W www.franchise.org.au                        T 1300 669 030                                       that is supplied by others. Readers should make their
                                                                                                                                 E peter.white@franchise.org.au
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                                                                                                                                                                                                                   thefranchisereview | 1
The road to recovery issue - Franchise Council of Australia
A MESSAGE FROM THE CEO

                                      “The FCA is continuing to work closely with government
                                        and other industry peak bodies to ensure that the voice of
                                        franchising and small business is heard by government as
                                        we head down the path to economic recovery.”

A lot has changed since our last         For the FCA, it has meant stepping up      on the same leave loadings as permanent
                                      our advocacy and activity to represent        workers will make it simply untenable
edition of Franchise Review and our   members’ interests and concerns to            for many businesses to keep them
businesses and community have         government while delivering timely            employed. Businesses will hit the wall, and
                                      information, business advice and practical
had to face the massive challenges                                                  employees will ultimately lose out.
                                      support to help meet the trading and             The FCA is hopeful of an improved
created by restrictions to stop the   workplace challenges.                         outcome as a result of its strong
spread of COVID-19.                      The response from our members              representations to the Federal
                                      has been terrific, including more than a      Government on this issue.
                                      hundred emails and messages of thanks
                                      and congratulations, as well as significant   Calling for food delivery
                                      positive feedback from government and         platforms to cut fees
                                      media.                                           Most of Australia’s 90,000-plus
                                         We have taken a strong public stance
                                                                                    individual franchised outlets are
                                      on the key issues which have impacted on
                                                                                    small businesses employing 598,500
                                      the sustainability of franchising and small
                                                                                    Australians and many are in the food and
                                      business, and the wellbeing of owners,
                                                                                    hospitality sector, so when they struggle,
                                      managers and staff.
                                                                                    there’s massive impact on the national
                                         Some of the key platforms have been:
                                                                                    economy.
                                         • the need for rental relief and
                                                                                       The FCA argued that unless the food
                                      government intervention as some
                                                                                    delivery platforms reduced commissions
                                      landlords refused to negotiate despite
                                                                                    to help sustain restaurants and food
                                      the plight of their tenants, especially in
                                                                                    franchises, there was a risk that many
                                      retailing;
                                                                                    would not be able to continue operation,
                                         • the need for tangible government

A voice for
                                                                                    with the threat of further major job losses.
                                      support for businesses to help maintain
                                      staff and supplement their income as
                                                                                    Relief for commercial
                                      trading revenue evaporated;
                                                                                    tenants
                                         • assisting with expert advice on

franchising and
                                      managing staff working from home,                The FCA also welcomed the ACCC
                                      including maintaining their commitment,       decision to allow tenants and landlords
                                      morale and mental health; and                 to get together and collectively negotiate
                                         • calling on the big food delivery         outcomes that optimise businesses’

small business in
                                      networks experiencing a huge lift in          ability to meet rental obligations will
                                      volumes to help the struggling food           support their ongoing sustainability as a
                                      retail and hospitality groups rather than     result of COVID-19 trading impacts.
                                      profiteer.                                       The decision recognised the urgency

unprecedented
                                         • currently making strong                  for retailers and landlords to collectively
                                      representations to the Federal                negotiate rent relief was an excellent
                                      Government on the issue of redefining         outcome following a joint application to
                                      casual workers, and we are hopeful of an      the ACCC by the FCA with the National

times
                                      improved result.                              Retail Association, Australian Hotels
                                                                                    Association and the Pharmacy Guild.
                                      The definition of casual
                                      workers                                       Looking to the future
                                         IR is at crunch point, and last week’s        Small businesses have been hit hard
                                      court decision to redefine casual workers     by COVID-19 and although restrictions
                                      means we can’t put this conversation off      are starting to be eased, the impacts on
By Mary Aldred,                       any longer. There are thousands of small      individual businesses and the economy
CEO, Franchise Council of Australia   businesses and hundreds of thousands of       nationally will be felt for some time.
                                      casual workers this decision is going to         The FCA is continuing to work closely
                                      hurt, if left unanswered.                     with government and other industry
                                         Casual workers are paid a higher base      peak bodies to ensure that the voice of
                                      wage, trading off sick leave and annual       franchising and small business is heard by
                                      leave permanent workers receive for a         government as we head down the path
                                      lower base wage. Putting casual workers       to economic recovery. n

2 | thefranchisereview                                                                                     thefranchisereview | 3
The road to recovery issue - Franchise Council of Australia
FCA delivering
        for members
      during COVID-19                              By Peter White
                                                 Executive Manager,
                                             Franchise Council of Australia

Like so many of our                          opportunity to delve deeper into the            For some time now, the FCA has been
                                             issues that were impacting members          dedicated to developing partnerships
member businesses,                           and provide clarity on fast moving          and relationships with organisations that
the Franchise Council                        developments. Many of these webinars        meet the business needs of members
                                             have taken place just a handful of days     across areas including employee
of Australia has through                     after major government announcements        relations and HR, superannuation,
necessity refocussed the                     to ensure members have the most timely      insurance, online learning, technology
                                             and up-to-date information available.       and finance, energy, POS, printing
way we deliver services                         Topics have now included:                services and more.
during COVID-19.                             Understanding the Employment                    The value of these partnerships has
                                             Implications of JobKeeper; Explaining the   never been more apparent than we’ve
    And like so many of our member           Commercial Leasing Code of Conduct;         seen over the past weeks, as we have
businesses, we have found new ways           Tax and Accounting during Covid-19;         drawn on their subject matter expertise
to connect and deliver value in this         COVID-19 impacts on Superannuation          in our member updates and webinars
challenging new operating environment.       and Insurance; Optimising energy            and shared their offers to assist members
    With the situation developing rapidly    usage and cost during the challenge of      through this time.
during March, the FCA quickly identified     COVID-19; The Psychology of Maintaining         These regular webinars and Member
that members needed a reliable source to     Positive Mental Health and Resilience;      Updates are planned to continue over
provide vital information and resources at   and an interactive webinar with Federal     the coming months to assist members to
a time of rapid change and uncertainty.      Minister for Employment, Skills, Small      operate successfully on the other side of
    As the Federal Government made           and Family Business Senator the Hon.        COVID-19.
announcements on business restrictions       Michaelia Cash.                                 The FCA is continuing to monitor
and stimulus measures at breakneck              The response to these webinars from      developments around COVID-19,
speed during March and April, the FCA        FCA members has been overwhelmingly         including ongoing social distancing and
made sure our regular email Member           positive. Registrations and attendance      business restrictions, and will be taking
Updates contained the key details            have often been well over 200 people,       these into account, as we look to optimise
members needed to know.                      with a strong Q&A component ensuring        and adapt our regular program of
    Alongside these, we launched             the webinar panels tackle the issues that   events, including the National Franchise
a webinar series that provided the           are most pressing for attendees.            Convention, over the coming months. n
4 | thefranchisereview
The road to recovery issue - Franchise Council of Australia
The impacts
A national survey of
franchise businesses

                                             of COVID-19
showed significant
reductions in March
2020 revenues as a

                                             on franchise
result of COVID-19
trading restrictions and
self isolation.

                                             businesses
    The “Pulse Check” survey was
undertaken by FRANdata for the
Franchise Council of Australia to gain
insights on the initial impacts and
experiences of the Australian franchise
sector during the COVID-19 pandemic.
    Representatives of 55 franchise
                                             Expectations                                  Assistance
systems covering 11,037 individual
franchised business outlets contributed to               $        33%
the survey.                                                                                                         44.7%
                                                                                                                    Franchisors

Revenue
                                                              $           58%                                       providing financial
                                                                                                                    assistance to more
                                                                                                                    than 50% of their
                                                     $   11.8%                                                      network

                                                 A high level of respondents (33 per           As at 31 March 2020, 44.7% of
                                             cent) indicated that 100 per cent of their    respondents were providing financial
                                             franchised business outlets would record      assistance to more than 50% of their
                                             a loss for March.                             network compared to 31 December
                                                 The majority (58 per cent) of             2019 when 73.9% of franchise systems
    Revenue falls of 25-50%          30%    respondents also anticipated a                said less than 5% of franchisees were
                                             significant weakening of income in the        being given financial support.
    Revenue falls of 50-100%         28%
                                             current quarter, with only 11.8 per cent          The highest level of financial support
    Income increase                  20%
                                             anticipating an increase.                     is occurring in the food retail and
                                                                                           sit-down restaurant category and the
   Almost one-third (30 per cent) of
respondents indicated revenue falls of       Support                                       lowest in the maintenance type services
                                                                                           categories.
25-50% on February figures and a further
28% indicated a 50 per cent to 100 per
cent fall in monthly revenue.                                        94%                   Landlords
   On the other side of the coin,                                    Prompt and
approximately one in five (20 per cent)                              sharp focus by

                                                                                                                                          #ChooseKindness
indicated an income increase in March                                franchisors on
                                                                     actions to support
2020.
                                                                     their franchisees.

Industries                                       Survey respondents reported a                36%           17.6%          31.4%          Rest is a super fund committed to supporting employers
                                             prompt and sharp focus by franchisors                                                        and their teams through these challenging times.
                                             on actions to support their franchisees. In       Landlords were noted as
                                             fact, 94 per cent of respondents provided     “unhelpful” or “very unhelpful” by             Over 85% of retail and fast food workers report being
                                             specific and often multiple examples of       27.5% of all respondents (or 36%
                                             the actions they were taking to support       when “not applicable” responses are            subjected to verbal abuse from customers.*
                                             their franchisees.                            excluded) and as “helpful” by only
                                                 Financial assistance (direct and          17.6%. 31.4% described landlords as            During this unexpected time, let’s do our best – together.
                                             indirect) was being provided by 61 per        “indifferent”. n
                                             cent of surveyed franchise systems.
                                             Specific assistance to navigate through
   Industries showing the greatest           changed business regulations and
resilience include pet related,              available financial support packages            The information gathered in the                             Learn how we can help at rest.com.au
maintenance and health services.             was being provided by 29 per cent of            survey will be used by the FCA to
Vulnerability was evidenced across retail,   respondents and direct involvement in           support ongoing submissions and
restaurants and fitness clubs.               landlord negotiations was being provided        representation to government for
                                             to franchisees by 18 per cent of franchise      Australian franchising.                      *Source:SDA2017survey.
                                                                                                                                             Thisinformationhasbeenpreparedwithouttakingaccountofyourobjectives,financialsituationorneeds.Beforeactingontheinformation
                                             systems.                                                                                        ordecidingwhethertoacquireorholdaproduct,consideritsappropriatenessandtherelevantPDSwhichisavailableatrest.com.au.
                                                                                                                                             IssuedbyRetailEmployeesSuperannuationPtyLimitedABN39001987739(Rest),trusteeofRetailEmployeesSuperannuation
6 | thefranchisereview                                                                                                                       TrustABN62653671394(Fund).
The road to recovery issue - Franchise Council of Australia
The
                                                                                                                                                                                post-Covid-19
                                                                                                                                                                                                                                                      Unemployment
                                                                                                                                                                                                                                                     will create a larger

Boom times
                                                                                                                                                                                franchising
                                                                                                                                                                                                                                                      pool of quality
                                                                                                                                                                                                                                                         franchisees

                                                                                                                                                                                fundamentals

ahead for                                                                                                                                                                              Better locations                 Prospective
                                                                                                                                                                                                                                                        Competitors

franchising?
                                                                                                                                                                                    will become available             franchisees will
                                                                                                                                                                                                                                                       will fall by the
                                                                                                                                                                                    & more realistic deals          have some capital
                                                                                                                                                                                                                                                       wayside due to
                                                                                                                                                                                     possible as quality             and an enhanced
                                                                                                                                                                                                                                                        the Covid-19
                                                                                                                                                                                   tenants have increased              motivation for
                                                                                                                                                                                                                                                      economic impact
                                                                                                                                                                                     negotiating power              financial certainty

By Stephen Giles
Partner,
                                                                                                                                                                                                                     With most assets
Norton Rose Fulbright Australia                                                                                                                                                           Quality                  intangible and reliant           Franchise networks
                                                                                                                                                                                     franchisees have                 on management                   can re-establish
                                                                                                                                                                                     been hibernating               expertise, corporate             and expand more
                                                                                                                                                                                    due to Government             restructures can often            quickly than other
                                                                                                                                                                                         support                    be effected without                 structures
                                                                                                                                                                                                                  founder loss of control

                                                                                                                                                                                                                                  Graphic courtesy of Norton Rose Fulbright Australia

As a leading legal                    Never will the business fundamentals      better able to curl up into a smaller ball to   hibernated well due to the Government              There will also be a new due diligence      nowhere, and will miss the opportunity.
                                  be so ideally aligned for quality franchise   hibernate. The well-targeted Government         support package, and can re-start               question for prospective franchisees –         Importantly, focusing on the past or
advisor to the franchise          systems. Indeed for some franchise            support packages have helped a lot,             quickly and even grow into multi-unit           what did you do for your franchisees           being dragged back to it is fatal.
sector, Norton Rose               systems, the period following the             as they reward those businesses who             operators with the right additional             during the COVID-19 pandemic?                      4. A differentiated franchise offer
                                  COVID-19 pandemic in Australia will           understand their customers and can              funding;                                        Or for that matter your staff and              that meets new market expectations,
Fulbright Australia               present the biggest opportunities seen in     control their costs.                                6. The extent of financial carnage          your customers? Leadership is best             and has credibility in a skeptical
partner, Stephen Giles,           more than 20 years. Not since 1998, when                                                      in the market will mean that franchise          demonstrated not during growth times,          market where the general reputation
                                  the introduction of the Franchising Code      The stars are aligning                          systems needing to restructure can              but in the tough times.                        of franchising will remain tarnished.
has extensive experience          of Conduct coincided with the beginning           The aligning stars of prosperity include    do so without the typical scrutiny or                                                          Features are likely to include:
guiding franchise                 of 10 consistent years of strong economic     the following:                                  reputational damage. The safe harbour           The keys to riding the wave                        a) Being independently and
                                  growth, have we seen so many growth                                                           provisions protect directors, and the                                                          objectively rated, so franchisees can make
businesses through                opportunities, and such a quality pool of
                                                                                    1. Unemployment will create a
                                                                                larger pool of quality franchisees, so          fact that most assets are intangible
                                                                                                                                                                                    How do franchise systems position
                                                                                                                                                                                themselves to ride the next franchising        a truly informed decision;
economic uncertainty              prospective franchisees.                      franchisors can be more selective and           means restructures can occur without            wave? It is not just a matter of turning           b) Being financially accredited both at
                                      Historically the franchise sector has                                                     the loss of founder control;                                                                   franchisor and franchisee level, as access
and regulatory change.            often been counter-cyclical, with the
                                                                                discerning than they have been able to
                                                                                                                                    7. The inherent nimbleness of
                                                                                                                                                                                up, or re-commencing as if nothing has
                                                                                                                                                                                                                               to finance is the key to growth post
                                                                                be in recent times;                                                                             happened, because a lot has happened.
Through it all, he has seen       exponential growth in franchising in most         2. The franchisee pool will include         franchise networks means they are               Some things will never be the same. A          COVID-19;
the franchise model prove         countries coinciding with an appetite for     people with prior business and                  better able to re-establish themselves          few of the important things are:                   c) Lower entry costs, as prospective
                                  growth, difficulties in securing finance      management experience, as well                  and take advantage of new market                    1. A compelling (and revised)              franchisees will not be prepared to pay
its resilience time and           and relatively high unemployment.             as a small amount of capital from a             opportunities.                                  customer proposition. Customers will           as much for a business in a competitive
time again. As the world          Perversely, as we have seen in recent         redundancy. These people will struggle
                                                                                                                                Only the best will prosper
                                                                                                                                                                                be buying more online, they will expect        market; and
                                  times in Australia, franchising growth        to re-enter the workforce and secure                                                            greater use of technology, they will               d) Lower operating costs, given the
braces for the uncertainty        slows when funding is readily available,      a job on $100,000 a year, as middle                  There is however a qualitative             have a closer eye for value, they will         likely lower revenue environment.
of a ‘new normal’, Stephen        and the pool of franchisees is depleted by    management will be collapsed by                 overlay or proviso to this prediction.          want reassurance on health and safety              5. A strong technology platform
                                  almost full employment. We have seen a        large corporations seeking to maintain          Only those franchise systems able to            in the premises and they will expect           and digital presence – the world has
predicts the franchise            trend away from franchising to corporate      profits in times of reduced turnover;           stand out to discerning franchisees             paperless transacting.                         changed, and Australia lags the world
sector is well placed to          outlets, with some taking the view that           3. For most, it will be less of a hyper-    in a crowded franchisor market will                 2. Leadership – franchisees expect         in e-commerce. Australia will catch up
                                  franchising is just too hard from a people                                                                                                                                                   quickly.
take advantage of the             management perspective.
                                                                                competitive environment, as some
                                                                                competitors will have fallen by the
                                                                                                                                prosper. We have already seen first-
                                                                                                                                movers such as Poolwerx, Pack & Send,
                                                                                                                                                                                leadership, and they will remember
                                                                                                                                                                                what happened during the tough                     6. A robust ability to withstand
opportunities it might                Now the worm has turned again. I          wayside due to the COVID-19 impact;             Tatts, Quest Apartment Hotels and               times. Franchisors expecting to lead a         isolation or unforeseen circumstances,
                                  predict history will show that franchised                                                                                                                                                    as people will want to know they can
offer.                            businesses will have weathered the
                                                                                    4. For those in retail, better sites will   Muffin Break secure high-performance            network forward must have performed
                                                                                                                                                                                                                               withstand challenging times; and
                                                                                become available, and more realistic            ratings under the Australian Franchise          well during the COVID-19 pandemic.
                                  COVID-19 storm far better than corporate      rental deals should be possible as              Ratings scale. Objective assessment of          Remember a favourite quote of mine                 7. An effective multi-unit franchise
                                  networks. We have already seen many           quality tenants (particularly those             franchise systems will be an important          – ‘there is no softer pillow than a clear      model with independent capacity
                                  major corporate collapses, particularly in    with a growth story) have increased             differentiator, particularly as the media is    conscience”.                                   to be funded. Funding of multi-unit
                                  retail. Not so much franchise networks.       negotiating power;                              still likely to take a negative angle and the       3. A growth and expansion strategy         franchisees is likely to be a key to
                                  Franchisors and franchisees are just              5. Quality franchisees have                 political environment remains fluid.            and plan. Marking time is going                franchise network growth. n

8 | thefranchisereview                                                                                                                                                                                                                                    thefranchisereview | 9
The road to recovery issue - Franchise Council of Australia
1
                                                                                                               Federal Government Initiatives               these businesses to notify the
                                                                                                                                                            Australian Tax Office (ATO) of these
                                                                                                               Cash Flow Boost                              errors, as the ATO will undertake
                                                                                                                   For franchises, the “Cash Flow           subsequent reviews and may require
                                                                                                               Boost” comes in the form of a credit         incorrect payments to be repaid.
                                                                                                               in the business’ business activity              Additional assistance may be

                                                                  Act now.
                                                                                                               statements (BAS) lodged for each             applicable for business, in the form of
                                                                                                               monthly or quarterly period from             a deferral of tax-related payments on

                                                                  Immediate
                                                                                                               March to September 2020. The main            an interest free basis until September
                                                                                                               benefit of the cash flow boost is a          2020. We recommend that you

                                                                  relief
                                                                                                               tax-free total credit provided by the        seek advice from your tax advisor
                                                                                                               ATO over the relevant BAS periods            to determine whether deferral of

                                                                  measures
                                                                                                               of between $20,000 - $100,000,               payments is an option for your
                                                                                                               calculated with reference to the             business. The good news is that at

                                                                  and access
                                                                                                               amount of tax withheld on salary and         the time of writing this article, we
                                                                                                               wages by that business.                      have seen cash flow credits flowing

                                                                  to Federal
                                                                                                                                                            to client accounts which is providing
                                                                                                               Eligibility criteria                         welcome relief to many businesses in
                                                                                                                   Businesses must have employees
                                                                  and State
                                                                                                                                                            the franchise sector.
                                                                                                               and an aggregated turnover of less
                                                                                                               than $50m in order to be eligible.
                                                                  Government                                   When assessing eligibility, the concept
                                                                                                               of aggregated turnover can be
                                                                  support                                      complex, so we have outlined a simple

Preparing your
                                                                                                               framework to apply. Aggregated
                                                                                                               turnover will include the turnover of:
                                                                                                                   • The test entity;
                                                                                                                   • Entities (connected entities) that

franchise business
                                                                                                               may have ownership in the test entity;
                                                                                                                   • Entities (connected entities) that
                                                                                                               the test entity may have an interest
                                                                                                               in; and

to bounce back
                                                                                                                   • Entities (affiliated entities) that
                                                                                                               act in concert together, which may
                                                                                                               include some franchise agreements.
                                                                                                                                                            Joanne Murray

in the wake of
                                                                                                               Let’s unpack this with an example:
                                                                                                                                                            Joanne.Murray@pwc.com
                                                                                                                   • A franchisor may have to
                                                                                                                                                            PwC Australia
                                                                                                               aggregate the turnovers of their
                                                                                                                                                            Partner, Private Clients
                                                                                                               franchisees when assessing whether
                                                                                                                                                            (+61) 3 8603 3078

COVID-19
                                                                                                               they breach the $50m threshold to be
                                                                                                               eligible for the cash flow boost.
                                                                  Tim Hall                                         • Similarly, depending on their
                                                                                                                                                            JobKeeper program
                                                                  tim.a.hall@pwc.com                           franchise model, franchisees may need           “The JobKeeper subsidy is
                                                                  PwC Australia                                to aggregate the franchisor’s turnover       providing businesses with critical
                                                                  Partner, Private Clients                     when assessing their own eligibility.        economic support, allowing
                                                                  (+61) 3 8603 5015                                • Practically, this may be difficult     businesses to re-open stores and sites
Article provided by                                                                                            to assess or have access to relevant         where it might not be economically
PwC Australia                                                         “With COVID-19 causing a 1 in            information to make an informed              viable without the funding. It is very
                                                                  100-year impact on many businesses,          decision.                                    important for taxpayers to ensure
                                                                  Federal and State Governments                    It will be critical to understand        that they maintain documentation
As Australia prepares to reboot the economy following             have responded positively via the            both legal structures and contractual        to support their application and
the after-effects of COVID-19, we believe the franchise           introduction of multiple initiatives to      relationships in assessing the need to       continue to comply with the ongoing
                                                                  support businesses and give them the                                                      requirements” - Joanne Murray.
community will play a vital role in stimulating much needed       best chance of emerging on the other
                                                                                                               apply the aggregated turnover test.
                                                                                                                                                               On 30 March 2020, the Federal
                                                                                                               Structure may again play an important
growth. Having worked with over 300 franchise groups in           side” - Tim Hall.                            role in the amount a group may be            Government announced the
                                                                      Whilst the intention of Federal
the past 20 years, we are deeply committed to providing           and State Government initiatives is
                                                                                                               eligible to receive. Take for example:       “JobKeeper” program, which
                                                                                                                                                            broadly comprises a wage subsidy
                                                                                                                   - a corporate group with multiple
the necessary support to help businesses deal with their          to support businesses of all shapes                 entities where each entity is         to help eligible employers keep staff
immediate needs and bounce back with a renewed vision             and sizes, the complexity of assessing              eligible to receive the cash flow     employed. The subsidy of $1,500
                                                                  eligibility for some businesses -                   boost; or                             per fortnight is paid (in arrears) to
and plan to reshape their future in a post-COVID-19 world.        particularly franchises - can be difficult       - a corporate group with a single       each eligible employee for up to
                                                                  to navigate. Here, we look at the various           employing entity, which is the only   6 months commencing 30 March
In this article we explore three key areas franchise businesses   support packages available that may                 entity who may be able to claim       2020. Although welcomed by many
                                                                  apply to your franchise business. Each                                                    businesses, as JobKeeper is paid in
should address as they adapt to the challenges brought on         business should seek their own advice
                                                                                                                      the cash flow boost.
                                                                                                                                                            arrears there can be a short-term
                                                                                                                   A word of warning though, some
by COVID-19.                                                      on the application of these measures to      taxpayers may have inadvertently             cash flow strain on businesses who
                                                                  align to their unique circumstances.         received the cash flow boost where           may already be facing cashflow
                                                                                                               not eligible. We would encourage             pressure.

10 | thefranchisereview                                                                                                                                                          thefranchisereview | 11
The road to recovery issue - Franchise Council of Australia
2
                                                                                      What’s next?
                                                                                                                                                                                          3                                                             Business Strategy
                                                                                                                                                                                                                                                           • Evaluate what you do well
                                                                                                                                                                                                                                                        and how you can solve the biggest
                                                                                                                                                                                                                                                        challenges in your industry and
                                                                                                                             “The decisive and targeted
                                                                                                                               government initiatives
                                                                                                                                                                                          Adapting to the                                               customer base. It’s about finding the
                                                                                                                                                                                                                                                        art of the possible to think differently

                                                                                      Tips to                                  were a welcome life raft for                               ‘New Normal’.                                                 with renewed vigour and positivity.

                                                                                      stabilise
                                                                                                                               many potentially drowning                                                                                                Finance

Eligibility for Employers                                                                                                      businesses. Now business                                   Reshaping                                                         • Look for ways to improve your

                                                                                      your cash
                                                                                                                                                                                                                                                        cash flow and liquidity and medium
    To be eligible for the payment, an
employer must experience a decline
                                                                                                                               owners need to stay afloat
                                                                                                                               and not take on water                                      your business                                                 to long-term forecasting. This is

                                                                                      preservation
                                            of services provided in the relevant                                                                                                                                                                        important to understand how your
in GST turnover of:
    • 30% or more for a business with
                                            period. However, the Commissioner                                                  or get weighed down by
                                                                                                                               excess baggage.”
                                                                                                                                                                                          strategy to                                                   business is capitalised and what

                                                                                      and set you
                                            has provided two alternative                                                                                                                                                                                measures you need to action for a
annual aggregated turnover of
$1 billion or less; or
                                            methods, accruals accounting or GST                                                                                                           thrive in a                                                   rapid revenue recovery.

                                                                                      up for short to
                                            attribution, which, if “applied in good
    • 50% or more for a business with
annual aggregated turnover of more
                                            faith”, may be used as a proxy for                                                                                                            post-COVID                                                    Workforce
                                                                                                                                                                                                                                                           • Start building your post-COVID

                                                                                      medium-term
                                            determining GST turnover. You may
than $1 billion relative to a comparable
period a year ago (of at least a month
                                            be able to use one of these methods                                                                                                           world.                                                        return to work strategy. Map out
                                                                                                                                                                                                                                                        the roles and responsibilities of your

                                                                                      recovery
                                            if you have practical difficulties in
or three months).                                                                                                                                                                                                                                       workforce and how changes may
                                            assessing GST turnover.
    In assessing whether the business                                                                                                                                                                                                                   impact your operations and human
                                                If you have applied (or may apply)
has suffered the necessary decline,                                                                                              1. Cash is king: Continue the                                                                                          resource policies.
                                            for JobKeeper, you should make sure
you can compare either the GST                                                                                               focus on optimising your cash
                                            that you have good documentation                                                                                                                                                                            Customer
turnover for a particular month or                                                                                           position, but don’t forget the
                                            to support your decline in turnover                                                                                                                                                                            • Prepare a customer
for a relevant quarter. For example,                                                                                         accruing liabilities.
                                            calculations. It is also important that                                                                                                                                                                     communications strategy that is
for the June quarter, the projection                                                                                             2. Trim excess fat: Review
                                            you identify and maintain all of your                                                                                                                                                                       purpose-led. Embed this strategy
for a decline in that quarter must                                                                                           your expenditure and identify
                                            eligible employees (noting that not                                                                                                                                                                         across all touchpoints for a consistent
be made on a reasonable basis, and                                                                                           opportunities to reduce, renegotiate
                                            all employees may qualify). There are                                                                                                                                                                       and authentic customer experience.
we strongly suggest that you keep                                                                                            or terminate costs that are ‘nice to
                                            also ongoing payment and reporting                                                                                                                                                                             • Where possible, fast track
documentation to support your                                                                                                have’ but not ‘need to have’
                                            requirements that you must satisfy.                                                                                                                                                                         any digital projects to reflect your
calculations and assumptions.                                                                                                    3. Pick winners: Review
                                            The ATO will review some taxpayers                                                                                                                                                                          changing customer expectations.
    If a business does not satisfy the                                                                                       customers, suppliers and staff and
                                            and if you have incorrectly assessed
decline in turnover for the first test                                                                                       identify those who you believe are                                                                                         Operations
                                            eligibility, or cannot support your
period, either April or the projected                                                                                        the most important to the success                                                                                             • Develop a business continuity
                                            claim, the consequence could include
June quarter, they may satisfy                                                                                               of your business.                                                                                                          plan with emphasis on arrangements
                                            repayment of the subsidy together
the criteria where they suffer the                                                                                               4. Have a ‘Plan B’: Prepare a                                                                                          for handling new outbreaks of
                                            with penalties and interest. You
anticipated decline in future periods
                                            should seek advice on these matters                                              backup plan ready to swiftly enact                           Susie Salmon                                                  COVID-19.
and therefore become eligible to                                                                                             if one of your critical stakeholders                         susie.salmon@pwc.com                                             • Assess where you can improve
                                            if you are unsure of your position.
receive JobKeeper payments from
                                                For more information around
                                                                                      Martin Ford                            cannot support your business plans.                          PwC Australia                                                 productivity, such as logistics and
that later point. However, once an                                                    Martin.ford@pwc.com                        5. Know your funding gap:                                Partner, Private Clients                                      supply chain.
                                            employee eligibility and how to apply
entity has established it has met the                                                 PwC Australia                          There will be a wave of funding                              (+61) 3 8603 2080                                                • Pay attention to cyber security
                                            for the JobKeeper program, visit the
requisite decline, it is not required to                                              Partner, Business Recovery Services,   demands in August/September.                                                                                               and have a plan to mitigate any
                                            PwC website.
retest that in later months.                                                          Financial Advisory                     Smart businesses are engaging with                               “What will it take to win in a post-                      unforeseen risks which may arise. n
    The Commissioner can determine          State Government Initiatives              (+61) 3 8603 3078                      their banks/financiers now to be                             COVID world? Stay relevant, keep up with
that an alternative decline in turnover         The various state and territory                                              at the front of the funding queue,                           new demands and shifts in your customer
test can apply where an appropriate         governments have introduced                  “The decisive and targeted          ensuring sufficient time to address                          consumption to create something that no-                         Preparing for the ‘new normal’
comparison period for 2019 is not           concessions for small to medium           government initiatives were            any queries ahead of the funding                             one else has thought of to propel you in                         won’t be easy but reimagining
available, for example:                     enterprises largely relating to relief    a welcome life raft for many           need.                                                        front of the competition” - Susie Salmon.                        the possible for your business
    • where a business was not              from payroll tax. While this may be       potentially drowning businesses.           It is critical that businesses,                              As you look to the future, it is important                   can create a competitive edge
operating a year earlier; or                relevant for franchisees depending        Now business owners need to stay       after what has rightly been an                               to refresh your strategy plan and identify                       that will sustain change no matter
    • where the prior period of             upon their size and structure, the        afloat and not take on water or get    initial focus of stabilisation and                           those drivers which have the most impact                         how big. If you need support to
business is not representative of           main challenge is that each state has     weighed down by excess baggage”        cash preservation, now focus on                              to your franchise business. Implement a                          reshape your strategic business
usual circumstances (e.g. bushfires or      introduced their own conditions to        - Martin Ford.                         identifying and managing the three                           practical action plan to navigate your path                      plan, reach out to a specialist
drought).                                   both eligibility and the associated          In the coming months it is          key funding drivers for a successful                         back to sustainable growth.                                      advisor to help you navigate your
    In addition, the JobKeeper rules        benefit available. For instance,          important to turn your attention       return from hibernation: accruing                                Let’s evaluate some of the key drivers                       options. You are not alone; we are
cater for groups that employ their          businesses operating across Australia     to proactive measures to stabilise     liabilities, exit and/or investment                          which you can focus on as you reshape                            here to help.
employees via special purpose               may be eligible for varying payroll       and preserve your cash position.       costs and re-entry working capital.                          your future plan:
employer entities. However, the             tax refunds or deferral of payroll tax    Those who do not act decisively in
application of this alternative test is     amounts dependent upon the level of       addressing their key working capital
strictly limited to specifically provided   Australian or state wages paid by the     issues, may be unable to deal with     Disclaimer: This article provides general taxation information and is not intended to constitute tax, legal, financial services or planning advice and should not be relied upon by
circumstances.                              employer.                                 the tsunami of accrued liabilities     you without consulting a professional advisor based on your individual circumstances. This article is based on information and circumstance known at the date of publication.
                                                                                                                             To the extent circumstances have changed, the article may no longer be relevant or correct. The information in this article is not and was not intended or written by PwC to be
    The term ‘GST Turnover’ is not              For updates around tax obligations    come August/September when the
                                                                                                                             used, and it cannot be used, for the purpose of avoiding penalties that may be imposed on you by the Australian Tax Office. PwC accepts no duty of care to you or any third
straight forward and does not               and relief for businesses affected        temporary relief expires.              parties and will not be responsible for any loss suffered by you or any third party in connection with or reliance upon the information in the article. PwC refers to the Australia
necessarily align to what is on your        by COVID-19, visit our dedicated             We recommend that you               member firm and may sometimes refer to the PwC network. Each member firm is a separate legal entity. Please see www.pwc.com/structure for further details.
BAS. Broadly, it includes the value         COVID-19 website.                         consider the following key areas:      PwC’s liability is limited by a scheme approved under Professional Standards legislation. ©2020 PricewaterhouseCoopers. All rights reserved.

12 | thefranchisereview                                                                                                                                                                                                                                                             thefranchisereview | 13
The road to recovery issue - Franchise Council of Australia
Value #1                                                                                 promise under a new COVID-19                   We re-forecast every franchisees’
                                                         Energise                                                                                 branding device, to provide confidence      business plan on a quarterly basis
                                                                                                                                                  in our strict safety standards and          with a variety of scenarios including
                                                            Our energetic value is about
                                                                                                                                                  to show our commitment to the               - same as last year, 7.5% decline and
                                                         speed, agility, quick decisions and
                                                                                                                                                  wellbeing of our franchise partners,        15% decline with associated expense
                                                         empowering our people to ‘just do it’.
                                                                                                                                                  team members and clients. The               reduction strategies. Most importantly,
                                                            March week one. We immediately
                                                                                                                                                  lifebuoy logo was quickly displayed on      we moved to monthly franchisee cash-
                                                         set up a 7am daily Cabinet meeting
                                                                                                                                                  all our vans, instore, uniform badges,      flow monitoring.
                                                         with our senior leadership team (SLT)
                                                                                                                                                  digital marketing channels and emails.
                                                         and appointed a COVID Coordinator                                                                                                    Banding together as an
                                                         to be our go-to on everything. We                                                        But there needs to be a new                 industry
                                                         quickly expanded our communications                                                      empathetic connection                           We know governments prefer
                                                         to the network with daily video
                                                                                                                                                      We have seen our network pull           to deal with industries rather than a
                                                         updates from an SLT member to
                                                                                                                                                  together during these times to              single brand, so we quickly formed a
                                                         keep our franchise partners across
                                                                                                                                                  continue to deliver service. Upon           Swimming Pool & Spa Association of
                                                         key developments and changing
                                                                                                                                                  hearing a client needed to put their        ANZ industry sub-group gathering
                                                         government information and arranged          weekly team virtual catch-ups became
                                                                                                                                                  pool servicing on hold after he and his     CEOs of pool franchise brands –
                                                         weekly town-hall Zoom meetings and           common to aid mental health.
                                                                                                                                                  wife, both chefs, lost their jobs, one of   Swimart, Clark and Jims. We met
                                                         weekly Poolwerx advisory committee              We’ve had no COVID-19 infections
                                                                                                                                                  our franchise partners went above and       weekly with our competitors to
                                                         (PAC) meetings.                              across over 1,000 staff in three
                                                                                                                                                  beyond. They serviced their pool for        share learnings and best practice
                                                            But we didn’t stop there. We              countries and at the start of every
                                                                                                                                                  free on Good Friday to ensure it would      and we co-funded a lobbyist to work
                                                         formed a Cabinet with veteran                meeting we ask the question – ‘is
                                                                                                                                                  be safe for the whole family to swim        collectively on our behalf. This work
                                                         franchise partners who were with             everyone safe?’
                                                                                                                                                  in during the Easter Long Weekend,          saw us successfully open our doors
                                                         us during the GFC and utilised their
                                                                                                                                                  leaving behind a basket of Easter eggs      again in New Zealand in a limited way
                                                         learnings from that period. We also          Value #4
                                                                                                                                                  for their two young children. I’m proud     during the level-4 lockdown. It’s been
                                                         formed a Cabinet with our suppliers          Find the better way, and                    to see our value “People first, always”     an all industry effort and great to see
                                                         to ensure we had a full supply chain         Value #5                                    reflected in everything we do, even in      competitors work together to achieve
                                                         response.                                    Dare to succeed                             times of crisis.                            common goals.
                                                            With home the new place of
                                                                                                         These are the constant                                                                   From a local perspective, our

Poolwerx’
                                                         work, study and play - we lobbied
                                                                                                      improvement and entrepreneurial                                                         franchise partners also reached out
                                                         governments in the USA, Australia
                                                                                                      values that have kept us at the top of                                                  personally to their local members with
                                                         and New Zealand at Federal, State,
                                                                                                      our game for nearly 30 years. They                                                      letters and calls with information on
                                                         County and Local levels to ensure
                                                                                                      keep us on our toes and force us to be                                                  the ‘essential nature’ of our service.
                                                         they understood we provide an

values are
                                                                                                      agile and nimble by nature.                                                             Most received great response, many
                                                         essential service to help safeguard
                                                                                                         March week three. We developed                                                       were already clients, which helped
                                                         the community and keep backyards
                                                                                                      new contact-free services, trained all                                                  with the campaign.
                                                         healthy during lockdowns. These
                                                                                                      staff in infection control, and rolled
                                                         conversations were crucial in keeping

driving a
                                                                                                      out the new services across more than                                                   Eyes firmly set on the future
                                                         franchisees’ doors open, and they did!
                                                                                                      350 retail and mobile locations in three                                                    We’ve constantly evolved through
                                                            As a business we replaced BAU
                                                                                                      countries. These included:                                                              the decades and this innovation
                                                         with Business as unusual. Every crazy
                                                                                                         • Poolside Water Test & Treat –                                                      through diversification has paid off
                                                         idea, new or old, we put back on the

dramatic
                                                                                                      designed with our retail clients in mind,                                               for our business, the world’s largest
                                                         table. We achieved all this in the first
                                                                                                      we come poolside to do a water test                                                     pool and spa servicing company. From
                                                         week of March and our energise value
                                                                                                      and treat their pool.                                                                   humble beginnings as a domestic
                                                         ensured there was a culture of speed
                                                                                                         • Poolside Water Test & Deliver                                                      pool service provider, we’ve evolved
                                                         to change.

reinvention
                                                                                                      – for our DIY clients, we will come         Franchise partner support                   into commercial pool servicing, retail
                                                         Value #2                                     to test their pool water, and leave         systems                                     stores, renovation, spas and now
                                                                                                      chemicals and comprehensive dosing
                                                         People first always, and                                                                    We reinvigorated a lapsed concept,
                                                                                                                                                                                              e-commerce. Having a business model
                                                                                                      instructions for them to treat their own                                                with multiple revenue streams allows
                                                         Value #3                                                                                 ‘Adjacent Partner Support’, which acts
                                                                                                      pool.                                                                                   franchisees to change emphasis for
                                                         Do the right thing                              • Home Delivery – clients can
                                                                                                                                                  as a buddy system between franchise
                                                                                                                                                                                              different market challenges, such
                                                            March week two. We turned to our                                                      partners, so they can also support one
                                                                                                      phone, text or email and we’ll deliver                                                  as those presented by the global
Poolwerx’ five corporate values were born out of         people values to keep them safe and          chemicals and all pool needs to an
                                                                                                                                                  another at local level.
                                                                                                                                                                                              pandemic.
                                                                                                                                                     Our Poolwerx Family Welfare Fund
tough times and have dug the brand out of every          operational. We closed our head office       agreed safe place at home.
                                                                                                                                                  kicked in with small acts of kindness
                                                                                                                                                                                                  Our people are safe, our doors have
                                                         and set up remote working. Next, we             • Curbside Dropbox Water Testing                                                     stayed open, we’ve created a new
rough patch since the business started nearly 30 years   installed sneeze-shields in all our retail   – clients can leave their water sample
                                                                                                                                                  and we have been heavily promoting
                                                                                                                                                                                              COVID contact-less model and we’ve
                                                                                                                                                  our third party free and confidential
ago. These values have served us well in previous        stores to protect both staff and clients     at a designated area in front of our
                                                                                                                                                  counselling service to the entire
                                                                                                                                                                                              progressed with how we bounce back
                                                         and moved to one person per van to           stores, our team will contact clients
downturns including the GFC, where the business          protect technicians.                         with results to arrange pick up or
                                                                                                                                                  network to ensure we’re supporting
                                                                                                                                                                                              an even stronger brand. n

actually grew. As we face another global crisis, our        As the Coronavirus spread and             home delivery of chemicals.
                                                                                                                                                  mental health awareness.
                                                                                                                                                     We already had in place a store
                                                         further restrictions were put in place,         • Curbside Park & Test (don’t leave
values will be the backbone of our transformation.       our Business Development Managers            your car) - storefront water testing,
                                                                                                                                                  shutdown procedure, so if some of            About John O’Brien
                                                                                                                                                  our businesses needed to go into             As CEO and Founder of Poolwerx,
                                                         remained in daily video contact with         where we collect the clients water
By John O’Brien                                          every franchise partner, ensuring they       sample from the car, complete the
                                                                                                                                                  hibernation, they had a step-by-step         John O’Brien leads the largest global
                                                                                                                                                  guide to support them through the            swimming pool service and retail
CEO and Founder,                                         had access to all the help and support       test in store and deliver the treatment                                                  company. O’Brien founded Poolwerx
                                                         they needed. Daily field visits and                                                      process from managing rent to vehicle
Poolwerx                                                 regular business meetings moved
                                                                                                      chemicals to the car.
                                                                                                                                                  leases, utilities, etc. We haven’t had to    30 years ago and has grown it into a
                                                                                                         As we rolled out our new initiatives,                                                 multi-award-winning system.
                                                         to being held remotely and daily/                                                        use it!
                                                                                                      we supported these with a consumer

14 | thefranchisereview                                                                                                                                                                                            thefranchisereview | 15
The road to recovery issue - Franchise Council of Australia
Before                                Through                             As things                         When the money
                                                                                                                                     COVID                                  COVID                              improve                            starts to return

                                                                                                                                   Affluent                              Survival                              Needs                                Affluent

Five
                                                                                                                                      Wants                          Cut back spending                The things they’ve missed                Different wants as the
                                                                                                                                  Delivered fast                       Basic needs met                          most                            economy changes

                                                                                                                                                                     Little luxuries added             But at affordable prices                 Some industries will
                                                                                                                                                                                                                                             disappear or take forever

critical
                                                                                                                                                                Growing demand for local,             Demand for different local,
                                                                                                                                                                                                      quality product becomes                         to return:
                                                                                                                                                                quality product-food is up
                                                                                                                                                                                                              the norm                        e.g. travel, tourist trade
                                                                                                                                                                        there now.
                                                                                                                                                                                                       And so does demand for                      Others will build:
                                                                                                                                                                Transparent quality service

steps for
                                                                                                                                                                                                      transparent, quality service            e.g. demand for different
                                                                                                                                                                       Online everything                                                     local, quality products and
                                                                                                                                                                                                         Online is here to stay.
                                                                                                                                                                                                                                                service is here to stay

managing
                                                                                                                        2. It’s all about people                               Triumphant Cleaning Services in Perth           5. Then put yourself
                                                                                                                                                                           did just this when I worked with them.                  into the position of
                                                                                                                            We have to be focused on what
                                                                                                                                                                           They quickly got rid of their domestic arm
                                                                                                                        is happening around us and keep an                                                                         captain

change
                                                                                                                                                                           to concentrate on strata cleaning services,
                                                                                                                        eye on what people really want as the                                                                     So many business owners I meet
                                                                                                                                                                           and in the ‘killer’ move, owner and GM
                                                                                                                        environment changes.                                                                                   every day are still working in the
                                                                                                                                                                           Shannon replaced himself with one of
                                                                                                                            It starts with your customer and their                                                             business. Managing the shop floor,
                                                                                                                                                                           his supervisors, stopped taking calls or
                                                                                                                        changing needs and wants through this                                                                  making sales, micro-managing staff
                                                                                                                                                                           looking at email until 3pm daily. This
                                                                                                                        time (see table above).                                                                                because they say it is the only way to get
                                                                                                                                                                           restructure, along with better systems,
                                                                                                                            So much of what has changed will stay                                                              things done properly.
                                                                                                                                                                           meant they increased turnover by 48% in
                                                                                                                        and then change again differently as we                                                                   This is the killer.
How to prepare for bounce back and focus on the big picture for your business                                           move out of lockdown. Online is here in
                                                                                                                                                                           six months, even before they franchised.
                                                                                                                                                                                                                                  If you want to grow your business,
                                                                                                                                                                           And went on to increase turnover by
                                                                                                                        a big way, so is the demand for different,                                                             you have to be able to delegate. If you
                                                                                                                                                                           $1.2m – all before they franchised. The
                                I know it’s difficult.                       Flexibility is going to be the name of     delicious, quality local product. Overseas                                                             want to delegate you have to be able
                                                                                                                                                                           key – they looked like and worked like a
                                One day we were happily trading.          the game in business for a while.             tourists have gone for a while.                                                                        to make sure your staff do the job
                                                                                                                                                                           franchise even though, ultimately, they did
                                • We knew our customers                      So, what to do?                                And, online or face to face, the                                                                   properly. And to do that you need to
                                                                                                                                                                           not choose to grow using this model.
                                • We knew what they wanted                                                              demand for excellent, transparent sales                                                                simplify, streamline, systemise, select
                                                                          1. R
                                                                              ecognise that in                                                                                Yes, it’s real and I come across so many
                                • We knew how to make them happy                                                        and service is only going to increase. You                                                             the right people and give your staff
                                                                                                                                                                           examples of this growth once businesses
                                Then, the next day – nothing…                every downturn, there                      do need to put in people who will relate                                                               properly documented, easy to use
                                                                                                                                                                           become focused on what’s important.
                                And now, as restrictions ease, it’s          are opportunities for                      to your customer base with empathy and                                                                 operations to do the job right. This
                            crystal clear many of us are not going           business growth                            efficiency.
                                                                                                                                                                           4. Examine future opportu-                         means the operations need to be in
                            back to that happy pre-COVID place in                                                           Your sales and customer service                                                                    a format that works, and in our new
                                                                              In every recession from the                                                                      nities and then restructure
                            one piece. The business environment has                                                     people are the ones bringing in the                                                                    era of business that simply has to be
                            changed, we have changed and so have
                                                                          beginning of time there have been
                                                                                                                        money. So, you need to make sure they
                                                                                                                                                                               your business as a lean,
                                                                                                                                                                                                                               cloud-based.
                            our customers.
                                                                          businesses, people, entities that have
                                                                                                                        have the attributes (skills and personality)           mean and very responsive
                                                                          been able to grow out of problems and                                                                                                                   Then you can spend your time
                                • Our cashflow has taken a hit. There’s                                                 to do the job in a way your customers                  machine for growth                              focusing on the big picture of the
                                                                          make good.
                            probably no spare cash to spend on                                                          love. The personality of your business                 Steps 1 – 3 above are all part of the           business.
                                                                              I have seen this in the last three
                            building business                                                                           is going to become more and more                   first step we ask all our businesses to                What are the changes happening
                                                                          recessions. For example, look at how,
                                • Suppliers, landlords, banks and more                                                  important as we come out of this phase             go through in our Restructure to Grow               around you?
                                                                          after Paul Keating’s 1991 / 92 “Recession
By Brian Keen,              have changed the rules – some good and
                                                                          we had to have,” Silvio’s Pizza merged
                                                                                                                        and it’s your people who give your                 Workshop where we work with you to                     How can you adjust the business
                            some not so good                                                                            business its personality.                          identify your opportunities and the best            as you see what is going on as
Founder, Franchise Simply       • Staff have been put off and even
                                                                          their brand with Domino’s and their
                                                                                                                            So often I see businesses asking sales         way to take them on board.
                                                                          business growth took off.                                                                                                                            business changes fast over the next
                            with the help of JobKeeper, some will                                                       and service staff to also take on tasks                It doesn’t matter then which business           few years to a new normal?
                                                                              Personally, in those same years, as a
                            never come back. So, we’ve lost a lot of                                                    they are just not suited to. You can’t ask         model you choose for growth – contractors,             Everyone agrees that as a business
                                                                          Perth-based partner in The Franchise
                            back up and help.                                                                           a massage therapist, with a soft and               employees, company outlets, licensees,              leader, business flexibility is going to
                                                                          Alliance, we were delighted when we
                                • Many of our customers have found                                                      supportive personality to also do sales            franchise partners - the structure you will         be your new normal.
                                                                          were able to place ourselves well once
                            other ways to appease their wants or                                                        – it just won’t work. In this case, to be          finally put in place will be the same.                 If you are still drowned in managing
                                                                          things started to move because the
                            simply let them go altogether                                                               successful, the sales will have to happen              The bottom line is – look after the             the day to day – business growth is
                                                                          demand for well-priced franchise outlets
                                • Others have probably found new                                                        elsewhere in the business structure.               people looking after your customers                 just not possible beyond a relatively
                                                                          soared as retrenched employees started
                            things they want instead – things to fit                                                                                                       and bringing in the money which means               small beginning. n
                                                                          to look to go into business and wanted
                            their newly constrained budgets and                                                         3. Focus the business on                          putting in a structure something like below.
                                                                          the security of a franchise for their first
                            circumstances
                                                                          endeavors. The franchise recruiting side
                                                                                                                            what brings in the money
                                • Most importantly, our customers will                                                     Simplify, simplify, simplify…
                                                                          of our business exploded and, because
                            have changed in the way they see the                                                            Business owners have a tendency                Leadership and control                                      CEO
                                                                          there were few white-collar franchised
                            world and the way they want to interact                                                     towards an entrepreneurial personality
                                                                          businesses at the time, we established a
                            with it and us                                                                              – attracted to the next bright and shiny
                                                                          number of new groups ourselves which                                                                                           Brand &       Financial
                                And the thing is, it’s hard to know                                                     opportunity.                                       Support making it happen                                     IT             HR           Admin
                                                                          also took off.                                                                                                                Marketing       Control
                            what the changes will be except that                                                            Go through the figures for each
                                                                              The key is to be open-minded and
                            change is not going to stop for a while as                                                  part of the business and work out what
                                                                          look for the opportunities. Then be
                            we all work our way out of this minefield                                                   actually makes the money.                          Bringing in the money                               Sales and/or Delivery
                                                                          ready to grab them when the time
                            over the next few years.                                                                        Then be ruthless and ditch the rest...
                                                                          arrives…
16 | thefranchisereview                                                                                                                                                                                                                                thefranchisereview | 17
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Like many businesses, Roll’d                       Each of these initiatives is designed        the times and are embracing new delivery
                                               to bring Roll’d directly to the consumer,        methods,” said Bao.
has been severely impacted                     whether in their workplaces and offices,             As he looks even further ahead, Bao
by the COVID-19 pandemic,                      or at home. Each also uses technology,           sees the business model continuing to
                                               whether it is live video feed or GPS             evolve over the coming years.
but CEO and Founder,                           location data to better serve the needs of           “The future of our world has changed
Bao Hoang, is using this                       customers.                                       and it has made me consider what our
                                                   The Roll’d Run is a long-term business       world will look like in five years’ time,” said
time as an opportunity                         model that will deliver pre-ordered meals        Bao.
to implement long-term                         to work, home or office, as long as it is part       “A typical Roll’d store will be located
                                               of a Roll’d Run. Roll’d Runs are currently       either at a door to a large shopping
strategies to build the                        launched in Melbourne and Roll’d plans           centre or on a suburban high street. Roll’d
business into the future.                      to regularly adding on suburbs through           will continue to cater for our current
                                               expressions of interest from customers.          customers in-store with those who work
   “As a team, we are committed to
                                                   The Roll’d Runner food van is planned as     in the centre or office tower or are just
continue adapting and refining our existing
                                               a food truck home delivery service rolling       shopping.
practices through innovation, to ensure we
                                               from suburb to suburb and will bring the             “However, the big difference will be that
build something new that is extraordinary.
                                               Roll’d kitchen to your doorstep, making          each store will have 10 delivery drivers,
Some of these changes will change our
                                               food in front of people’s homes. Launching       five in cars and five controlling drones,
business forever, but most importantly for
                                               with a test suburb in Melbourne, the             completing Roll’d runs during the day
the better,” Bao told The Franchise Review.
                                               ultimate aim is to have one Roll’d Runner        into local business parks, local sporting
   They are changes designed to maintain
                                               per suburb throughout Australia.                 clubs during games on the weekend, to
the livelihoods of the 1800 employees
                                                   Finally, the Roll’d Box is planned as        local professional offices, to local schools;
and franchisees that the brand’s 82 stores
                                               more of a do-it-yourself offering for            anyone who wants to eat Roll’d but may
support – and to open opportunities for
                                               customers, with deconstructed bowls of           not have the time to get their Roll’d fix at
more positions into the future.
                                               Pho delivered to customers’ homes, where         a store.
   “We believe that consumer behaviour
                                               they can click on a link to watch how to             “At night, Roll’d will be delivering to
has significantly changed and will remain
                                               prepare the meal.                                people’s homes, to local sporting clubs or
changed beyond this pandemic,” said Bao.                                                                                                                            Benjamin & Benjamin Insurance Group ABN: 37 603 884 108 AR No: 1000626
                                                   “These group innovations are here            gyms, to home dinner parties. Every Roll’d
   “I have no doubt that technology and
                                               for the long term and will become a              store will also have a Roll’d Runner truck
convenience are the keys to the future of
                                               permanent part of the Roll’d network,            connected to their store. Working day and
                                                                                                                                                                               www.benjamin-ig.com.au     We operate in each state
hospitality. So we are melding technology
                                               operations and logistics,” said Bao.             night. I would very much like to see the
into our new delivery systems, with the                                                                                                                                 PSC Connect Pty Ltd    ABN: 23 141 574 914       AFSL No 344648
                                                   “We are incredibly proud to say our          Roll’d Runner become the centre of every
Roll’d Run, the Roll’d Runner and the Roll’d
                                               franchisees have risen to the challenge of       community neighbourhood,” Bao said. n
Box,” he said.

18 | thefranchisereview
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