By Tristan Rogers, Managing Director, Concrete Group.
By using readily available technology, a business can retain control of its brand’s appearance when setting up franchises abroad
Over the past few years, many businesses have reaped the rewards of adopting franchise strategies in order to tap into international markets.
The Middle East and Asia, in particular, have seen increasing numbers of franchises established due to rising personal income and improving business conditions, which has attracted foreign investment.
This low risk, high reward strategy is a strong draw for businesses, especially those who have experienced financial losses associated with wholly owned overseas business outlets.
With a growing number of dedicated franchisee businesses in the emerging markets, UK companies are now able to expand overseas easily. With domestic spending cuts and tax rises coming from the new coalition’s emergency budget, the popularity of conducting business abroad looks set to rise even further..
Despite this, many in the business world believe that franchising suffers from a lack of control and poor performance visibility. This, however, can be easily avoided.
In order for international expansion to be a success, businesses need to install a framework of checks and balances into their franchise model in order to prevent brand erosion.
Working to the analogy “Your brand; Their money”, brand owners need to increase their local market knowledge, whilst at the same time deliver into market the experience and DNA their brand is made from. This is achieved through the latest collaborative working and “light touch” modern web based computing,
If a business was to use web-based franchise collaboration software, for example, it would be able to maintain careful control over its brand. This kind of software, normally provided as Software as a Service (SaaS), doesn’t risk sending sensitive brand, customer and merchandising information around the world by relying on insecure methods such as posting documents or disks.
More importantly, this technology can transform the way in which merchandise and marketing collateral and information is distributed across all franchises, in order to increase financial performance and international brand consistency.
By using technology through a portal in this way, any franchise can access all marketing materials, brand guides and guidance literature, whilst also having the means to procure store fixtures and fittings and Point of Sale materials from approved international suppliers.
In addition to ensuring quality and consistency, franchises gain access to the same volume discounts already negotiated for home stores. Once in place, these portals can quickly become the single point of truth for your international partners, providing them a “one stop shop” for their needs in market.
By offering franchisees this platform for improving their business effectiveness, companies will also have access to far more detailed information about customers, sales, and the impact of marketing on customers.
The franchise model is successful because it enables brands to enjoy the benefits of relatively low risk international expansion. However, the main worry is determining how to maintain control of the brand and its reputation at the same time.
Unless they can successfully take control of the whole franchise network, with easy to use and available technology, business will struggle to keep hold of their brand identity when expanding to untried and untested waters.
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