Home appliance rental franchise Mr Rental has unveiled a lower cost and new-look kiosk model as part of a strategy to improve market penetration in regional areas. The new Tier 2 set-up will be based around the hub and spoke distribution model and allow franchisees to expand their existing business.
Mr Rental general manager Alan Payne said “For under $100,000 franchisees can add another unit to their franchise operation that utilises existing logistics making it an easy investment and a quick contribution to their business.
“It’s an attractive proposition that will give franchisees looking to expand through multi-unit franchising the opportunity to do so. Some franchisees can also consider other retail stores with business synergy as working partners for their new retail outlet, ” said Payne .
“Within the next two years we’ll have all 115 of our territories across Australia and New Zealand committed but this new model will create further opportunities to penetrate the existing market,” Payne added.
There are about 20 areas in Australia and New Zealand that are likely candidates for the Tier 2 model to be introduce over the next two years.
“One of our Adelaide franchisees has already started with their main warehouse and store in Edwardstown, a retail showroom display in Arndale and kiosk shops to be opened in the three remaining territories; all using the same warehouse, which is a much more efficient operation logistically.”
The aim is to consolidate the distribution side of the business, with many franchisees operating out of a few larger, more efficient warehouses in each area. Melbourne and Sydney, for example, may need just three warehouses rather than the eight currently operating in each city.
Staff within the franchise will also become specialised in their work, with some focused on customer service while others will concentrate on storage, servicing and logistics. “This will be a good outcome for both our franchisees and customers; with improvements in both the home delivery and customer service areas,” said Payne.