Giggitte Phiri, Placecol Franchisee

With a strong background in HR, this franchisee has achieved balance in a brand new mall, found the best in a refreshed franchise concept, and leveraged her franchisor-franchisee relationship.


Giggitte Phiri, Placecol Franchisee

The days before franchising

“I’d been an HR executive for a company in the pharmaceutical and medical industry for many years, as well as in retail for a national retailer. I didn’t want to work the usual nine to five for someone else my whole life, and having been a customer of Placecol and loving the brand, it was a natural choice to investigate opening a Placecol franchise.”

Phiri had investigated a number of brands before settling on Imbalie Beauty and Placecol. “I chose it because the brand is well-known and the model is proven. But with Imbalie in particular, they’re open to franchisee suggestions and I wanted my salon to be a one-stop-shop to include a hair bar that catered for all hair types.”

Setting up shop

“What people don’t always realise is the time factor. The whole process of opening my doors was close to two years. I was looking in the area I live in for a good location before I even approached Placecol. I knew that Forest Hill City mall was going to be built so I approached the developers, explained my interest and asked about the process of applying. I then went to Placecol saying I wanted to be a franchisee and I’d found a site. They helped with vetting and negotiating the lease with the developers.”

Financing the franchise

“It had always been my intention to own my own business, so I’d saved about 90% of the capital. The remainder I financed through the bank, but I’d recommend to any franchisee that they have as much as possible. Even if you have backing from a bank, their wheels turn very slowly.” In Phiri’s case they required a lease agreement from the mall developer, which took so long that when Phiri opened her store on 29 May, the bank’s funding still hadn’t come through. “Luckily I had the capital to pay salaries.”

Unexpected challenges

”The developers expected the mall to open on 17 April but it wasn’t complete. By the time I opened the following month, the centre was just over 50% complete, many tenants were absent and it wasn’t attractive to customers.”

Phiri used her HR and negotiating experience with the backing of Imbalie Beauty to discount her lease. “Mall rental is very expensive. We negotiated the rent down and re-worked the annual escalation and centre marketing fees.”

Yet more challenges

“You have to be prepared for every eventuality. In a mall there’s no guarantee you’ll be the only one of your kind. There are a number of hair and beauty concepts operating in very close proximity to me, so I have to ensure impeccable service and actively market the store with specials and discounts.”

Your franchisor relationship

Placecol

“It’s essential you have a good relationship with your franchisor. Esna Colyn and her team aren’t afraid to get their feet wet or take their gloves off for their franchisees, but they’re also open to suggestions. It’s very give and take. I have a new concept store, and wanted to add a hair bar. They helped evaluate its viability and source suppliers. Similarly, Esna came to me one day saying she’d found amazing wigs. I needed convincing this time, but haven’t looked back.”

Getting customers

“You’re ultimately responsible for getting customers. The franchise marketing fee I pay goes to campaigns that benefit the whole group, and the marketing fee I pay the mall goes to marketing the mall, not me specifically. I spent a good two months canvassing outside the mall, I’ve set up a Facbook page, and my staff canvas internally. You have to be proactive and offer specials and packages that appeal to your market at different times of year.”

Managing cost of business

“Retail hours are long – Monday to Thursday is 9am to 8pm, Saturday 9am to 9pm and Sunday 9am to 5pm. Because the mall was incomplete and tenants were complaining, they offered temporary shorter trading hours. I strategically chose to keep the late trading time because it suited our customers who are working professionals. Customers vote with their feet, so if someone called at 7pm for an appointment we could accommodate them.”

To keep the cost of business in check when mornings are quiet, Phiri uses a sophisticated scheduling system. “When I spoke to other franchisees, they were doing their own thing. I approached my network in the retail industry to get more sophisticated scheduling software, and it means I can see when there are busy times, when I can afford skeleton staff, and can ensure they work their 194 hours per month across three shifts a day.”

Tracy Lee Nicol
About the Author
Tracy-Lee Nicol is the managing editor of Franchise Zone Magazine and deputy editor of Entrepreneur Magazine. She studied her Masters degree in Art History and Visual Culture at Rhodes University and spent the next two years working and travelling in Asia. Her love of people, business and teaching is reflected in telling the stories of entrepreneurs, franchisees and franchisors, inspiring others to take the leap to being their own boss and bringing about positive change in South Africa.

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