Shaking Things Up

Staying relevant will cost you money. So the question is: Will it be worth it?


Shaking Things Up

A good deal of planning is needed when you decide to invest in a franchise. In the initial stages you find your brand, you decide you like the look, feel and mechanics of it, and then you invest your time money and effort into making it a success, developing a loyal customer base, and generating a return on your investment.

But what happens five years down the line when you’re comfortable with the way things look and run, customers have got used to the brand and being able to purchase just what they want, and your franchisor says it’s time to change and freshen things up a bit?

“People buy with their eyes first, so keeping a brand fresh is absolutely paramount to remaining relevant in a competitive industry,” says Christo Calitz, CEO of Taste Holdings food franchise division. “Sometimes these are large changes like a brand identity overhaul, or they can be smaller changes like the pictures you hang on the wall, product arrangement, or the way the menu boards are designed.”

Rands and cents of change

One way or another, these changes are going to cost your business money, so you need to assess when the last change was made, how often changes are required, the extent and cost of a freshen up, and whether, after footing the bill, you will see a return on the investment.

Very often, the franchise agreement will stipulate the level of change required over what period of time, for example soft furnishings, wall decorations and perhaps menu boards will be changed every three to five years, while major overhauls may occur every seven to ten years.

For this reason, it’s important to discuss with your franchisor, before signing a franchise agreement, just what capital outlay is expected (over and above your initial set-up costs) every couple of years to re-energise the brand and your store.

“With the Maxi’s rebrand in 2005, the idea was to reposition the brand in a way that differentiated it from similar competitors. This meant calling in designers and changing everything to reflect the right atmosphere as well as represent the values of the brand better. We were also mindful that although it’s essential to keep a brand fresh, franchisees would need to finance these changes. As a result, the design itself is classic and small changes can be made easily every few years without breaking the bank. Because of this, many of our franchisees were on board with the change because they could see the value that the rebrand would bring.”

Don’t get short-changed on change

So what do you need to look for when picking your brand? “It’s important to determine whether the changes that are being made to the brand are going to add value,” says Calitz.

“At the same time, you have to see that something is being done to keep the brand relevant and competitive: You can’t leave things too long or the brand gets weakened. Even though you might be reluctant to make the changes required, rather make them when times are good than being forced to change, and change big, when everyone is under pressure. Comfort zones are not good for business.”

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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