This idea is a fat lot of good
Franchising: the format that has made Fatty Arbuckles fit for expansion will seek new converts at its national exhibition this week
Sunday 29 September 1996
He looked at several franchise operations and finally opted for the themed restaurant group Fatty Arbuckles American Diners. The Manchester-based company, co-founded in 1983 by former Beatles associate Peter Shotton, seemed a "young and progressive" organisation that would offer flexibility and support.
Earlier this year, Mr Corper and his wife, Clare, opened the doors to their Ipswich outlet - and appear to have been over-run with customers. Mr Corper, who was given two months of training in the catering business beforehand, says he is "working 14 hours a day, seven days a week, but I wouldn't want it any other way".
In the second week of operation the outlet became the group's second most successful. The number of staff has already increased from 14 to 33.
But it is just one of many that have opened in recent months. Tottenham and Islington in north London, Birmingham, Cardiff, Harrow, Rhyl and Winchester are all among the places to have received the Fatty Arbuckles touch, and a flagship restaurant is due to open in London's West End before Christmas.
The chain, named after Hollywood actor/director Roscoe "Fatty" Arbuckle, has grown to more than 30 outlets since the first franchise was opened in 1991, with two-thirds operated by franchisees. And expansion is intensifying: the group expects to have 50 restaurants serving "very generous portions of American food at an affordable price" by the end of the year, and has plans for another 30 next year.
"Any restaurant's success is governed by a good location, and we really spend a lot of time looking at sites," says managing director Adrian Lee. "Couple that with our proven concept and support and it really is hard to fail."
But Fatty Arbuckles is not the only catering operation that is dining out on the franchise concept. Neither, says Peter Stern, franchise manager at NatWest, is the idea confined to the likes of Kentucky Fried Chicken and McDonald's. Among the others are the Cybercafe and Mongolian Barbecue operations, while US-based sandwich bar operators are competing with British companies for a share of the booming take-away market.
Mr Stern also points out that franchising is becoming popular in the business-to-business arena. As well as the instant printers that have been around for some time, there are now such operations as hydraulic hose supplier Pirtek, concrete company Mixer Mate, several parcel delivery services and a number of motor factors.
But, then, the whole franchise market appears to be growing. According to figures recently produced by NatWest and the British Franchise Association, the overall turnover of true business format franchising rose 7.1 per cent last year to pounds 5.9bn - continuing the steady improvement from 1984's pounds 0.9bn. The number of active franchises grew twice as much to reach 474, supporting 25,700 franchisees. It is also thought that the sector employs about a quarter of a million people either directly or indirectly. As Mr Stern says, such figures seem to support the view that "at least in theory everything is franchisable".
Meanwhile, the organisers of this week's National Franchise Exhibition at the NEC in Birmingham say prospective franchisees will be able to meet an unprecedented array of companies. The show, which runs from 4 to 6 October and is now in its 13th year, is the biggest such event ever held in Britain and will be opened by Sir Bernard Ingham, president of the British Franchise Association. Businesses ranging from greetings cards to hi-tech signage will be seeking to entice fresh investors with the promise of successful careers and substantial earnings. The amounts that need to be invested range from pounds 5,000 to pounds 500,000.
However, a warning note comes from a recent assessment of the franchise market published earlier this month by City University Business School. After a comprehensive survey of activity over the past five years, Professor Christina Fulop, the report's author, highlights two particular concerns. First, more stringent initial recruitment by franchisors is essential to minimise turnover of franchisees - even if it risks slowing down a network's rate of growth. Second, as the concept develops, there is a danger that too many franchisees will have met their expectations and reached "a comfort level", with the result that the overall businesses may suffer from reduced enthusiasm and drive.
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