Stan Gordon, CEO of Franchised Food Company, takes our Q&A.
F: How can you differentiate yourself in the market?
FFC: All of our brands under the Franchised Food Company banner — Cold Rock Ice Creamery, Pretzel World, Nutshack and Mr Whippy — make our customers happy by providing them with an experience when they visit any of our stores. Take Cold Rock for example… we don’t just offer an ice cream but we invite customers to be involved with our brand experience, to be a part of the fun creation process and a part of the theatrical ice cream making to their individual taste.
We differentiate ourselves by offering something yummy that makes people feel good. What we have is a treat. It’s not a necessity, but it’s fun, and it brings a smile to people’s faces. I mean, who doesn’t love ice cream or a freshly baked pretzel, or some moorish nuts, or even remember the tune Greensleeves?
F: What’s a good location?
FFC: Depending on the brand, areas with relatively high foot traffic are the obvious ingredients for a successful site. In the instance of Cold Rock, a prominent street location that is surrounded by restaurants means our store automatically becomes the dessert option experience – so it’s finding these locations and making sure we have a presence!
At the end of the day, it all comes back to convenience and ease, because the less people have to venture out of their comfort zone to get to the offering, the more encouraged they will be to head to your store. Think about times when you haven’t been able to get a park somewhere, or can’t find a store because it’s hidden away somewhere tricky… You simply move on to the next best thing.
When assessing a location, it’s important to ask the simple questions like is the space a place people are familiar with, and is it easy enough to park? What others drawcards are in the area that might entice customers? The more reasons they have to visit the store, the better!
F: What changes are coming in your particular business?
FFC: I think for Franchised Food Company and our brands, the most poignant change in our business is the adoption of the co-branding model and the increase in the number of franchisees opting for a Cold Rock Express, rather than a traditional store. Simply put, why wouldn’t you want to benefit from finding another source of revenue with the same basic overheads?
It’s definitely becoming more and more obvious that the whole retail experience is shifting. People are changing their shopping habits and looking for the easiest options when it comes to purchasing; whether it be clothing, gifts or groceries. Retailers simply can’t see the benefit in constantly climbing labour and rental costs. Many consumers are spending more heavily online than ever before, but luckily for us our brands are somewhat protected because you can’t buy an ice cream online!
F: What trends are you following/predicting in your particular business?
FFC: With our brands and our offering we’re certainly leaders in the fun treats industry, rather than followers. As a franchisor, we’re always researching, keeping on top of international trends and introducing to the Australian market the best of what’s available in the world treat franchising sector.
In terms of trends for the sweet treats market, the most obvious would have to be the number of yoghurt bars popping up all over the place. While they’re perceived to be a healthier dessert option, history and indeed my experience tells me that they won’t be here for the long haul… ice cream on the other hand, will never be out of favour. It was here long before I was born, and will be here long after I am gone.
F: What makes this a good market to invest in?
FFC: What we’re offering is a fun experience. It’s not an expensive purchase but one that makes us feel good… people never stop wanting to indulge, especially in something that is affordable and easily accessible. Instead of going out to the movies or live shows, which might cost $50 plus, you can enjoy a treat and the experience and happiness that goes along with it, for just a fraction of the price.
We like to compare the treats market to the marketing lipstick theory; when times are tough lipstick sales escalate because people like to make themselves feel good… if even just for a short time. Just like you would enjoy an ice cream for a bit of a pick me up.
F: How do you help with location and lease negotiation?
FFC: With prospective franchisees, we believe it’s really important to assist as much as we can with lease negotiation. Due to the nature of shopping centres, which can be a little complicated, we tend to look after all lease negotiations. When it’s a strip shop we give as much advice as we can in terms of area and location.
We provide advice to potential franchisees every step of the way, but of course we can’t be the ones to make the final decision on the location and lease. By taking demographics, surrounding competition, and other factors into consideration and using market intelligence, we offer as much guidance as we can to advise potential store owners accordingly, in the hope that they can make the best decision possible and come to own a thriving business! After all, the more successful our franchisees are, the more successful we are.
THE DETAILS
How many stores do you have in Australia? Across all of our brands we have about 160 stores in Australia, with a presence in all states and territories!
What’s the turnkey cost of a franchise? Of course this is dependent on a number of factors including the system, location and the chosen brand, and can be anywhere between $80,000 and $300,000.
How long is a franchise term? Franchise terms are very dependent on a number of different factors, including the system and brand. Often in a shopping centre environment the first part of the term usually mirrors the term of the lease, usually five or six years, with the same term as an option. Strip shops usually get a 10 year term, again with the same term as a further option.
- Find out more at www.ffco.com.au