Colin Taylor started franchising Stirling Sports in 1983, and has since built the brand into one of the biggest retail chains in New Zealand.
Colin Taylor
<p class="content">
Motivation is always an interesting topic, particularly to franchisors.
How to select motivated people – and keep them motivated – is perhaps
the most burning question in franchising. Over the years, I have found
a number of interesting little ways which work for us at Stirling
Sports, and which have helped us all to achieve a greater level of
success.
</p>
<p>Of course, greater commitment and, as a result, greater motivation
are some of the often-quoted benefits of franchising. I have commented
before that sales can be as much as 50% higher at a franchised outlet
compared to a company-owned and managed store. Yet although the
financial rewards to be gained from owning a successful business might
seem to be enough in themselves to keep franchisees motivated, in truth
they are not.
</p>
<p>Ask yourself whether you honestly go to work just for the money? I
know that if money were all that motivated me, I would certainly not be
in sporting goods because it is such a small market in New Zealand. But
I enjoy it – and franchisees are motivated the same way.
</p>
<p>When we started franchising, we found that people were either
naturally motivated, full of enthusiasm and with a strong, hard work
ethic, or they were not. If they were not, and if we were not able to
motivate them quickly, the prospect of more money – or the threat of
ruin – would not be sufficient to cause them to do the right things. We
had to arrange for them to sell.
</p>
<p>When we did that, we saw the proof of the importance of motivation
in the huge increases in turnover at the same store when one owner sold
to another who had what it takes.
</p>
<p>But even the best franchisees will occasionally lose energy or
enthusiasm, and their sales will plateau as a result. How do you
improve the long-term motivation of those people and the entire team?
</p>
<h2><a name= 'Information'>Information</a></h2>
<p>
I have found an important element to be the sharing of comparative and competitive information.
</p>
<p>Getting franchisees to correspond, to report and to share
information is not an easy thing to achieve. Franchisees are, you
constantly read, at the sharp end of the business, and it is the role
of the franchisor to free them up to concentrate on their customers.
Yet it is in the best interests of each individual franchisee – and of
the team as a whole – that they spend some time analysing the business
in their particular market and sharing the results with others.
</p>
<p>At Stirling Sports, when we started franchising we already had 20
years of retailing sporting goods behind us. We had for years collated
regular weekly reports, not just about sales (comparing department by
department with the same period of the previous year), but also about
market forces, hot selling lines, customer numbers and such other
things as we felt were needed to help us identify and achieve our
goals.
</p>
<p>It was lucky that we already had that in place, because the
requirement for reporting was there as a standard feature from day one
of the franchise. As many franchisors will tell you, it is much harder
to introduce such a system later when it means creating more work and
more reporting for already busy franchisees. However, the benefits are
considerable.
</p>
<p>This comparative reporting brought great bonuses in motivation.
Store owners saw it as a challenge. They wanted not only to blitz their
previous year's department and total figures, but they also wanted to
blitz other stores' figures. Each month, by hook or by crook, they
would seek and usually find some achievement or some measure that they
could beat. They did this for personal satisfaction but also, as we
produced a composite report and circulated it to all franchisees, they
started to put pressure on themselves to achieve and be recognised by
all their peers. They found, in effect, new motivations.
</p>
<h2><a name= 'No Secrecy'>No Secrecy</a></h2>
<p>You would not enjoy being in the Stirling Sports group if you are a
secretive person, for we publish all the figures, even those for the
franchise company, to everyone.
</p>
<p>
Our systems measure and report to every owner the following information on a monthly basis:
</p>
<ul>
<li>All stores' sales are compared by department and by total.</li>
<li>All stores' customer numbers and average sales per customer are group knowledge.</li>
<li>All stores' sales percentage increase, by department, monthly and annually, are known to all.</li>
</ul>
<p>There are only three things needed for a retail store to be
successful: good sales, a good gross profit, and low expenses. With our
franchisees understanding these key success factors, and having valid
figures against which to measure their own performance, we can make
meaningful comparisons to help each franchisee. Our advisory team,
including our senior accountant, discusses with each owner their
store's performance in detail, with particular regard to:
</p>
<ul>
<li>Sales, and sales per square metre</li>
<li>Gross profit</li>
<li>Expense analysis</li>
<li>Stock management</li>
<li>Owners' equity</li>
<li>Return on investment</li>
</ul>
<p>The only thing that each franchisee doesn't know about the others is
the net profit that each achieves. Even so, our society is so
tight-knit that many of them discuss their results openly.
</p>
<p>By analysing store reports, extrapolating trends and then flowing
all the information back to the store owners, we create a great deal of
goodwill and a team spirit within the group. It makes them all feel
part of the system – not just one end of it. They know almost
everything about everyone else, including the franchisor company's own
sensitive sales information, and because it is an open, friendly and
co-operative society they feel good about it and are motivated to
achieve.
</p>
<h2><a name= 'Hand-Written'>Hand-Written</a></h2>
<p>However, this is not the whole story. For some years, we had been
trying to get more feedback from our franchisees about local events
affecting our stores' performance – competitors' actions, staffing
issues and so on. It was like drawing teeth to get written comments
about all these extraneous things which affect a business for better or
worse.
</p>
<p>There were a number of the team who did produce good, meaningful
reports, but we were not making much progress with the others despite
all sorts of ideas. Then one month we decided to publish to all stores
a couple of extremely good reports so that everyone could see what was
needed. The effect was noticeable. The next month we got a few extra
reports, hand-written but full of the information we needed to keep us
on the pace.
</p>
<p>When we selected some of the best and copied them in their entirety,
without censorship, to all the franchisees we got an even better
reaction.
</p>
<p>We thought about this at length, and now believe that our people are
motivated by having their own individual report out in the hands of
other franchisees and staff. It gives them a feeling that they have a
voice, that they are being listened to, that any problems are shared,
and that they are part of the whole team no matter how far they are
from the group offices.
</p>
<p>In a later month's reporting, we received 47 full pages of very
valuable market information – even the handwriting had improved! It may
take much longer now to read the monthly reports, but I welcome that
because it helps us all to stay much closer in touch with each other,
and with the real issues. We have found out things that are extremely
helpful in our decision-making – and all of this because somehow we
struck the right chord in getting feedback.
</p>
<h2><a name= 'Recognition'>Recognition</a></h2>
<p>If writing reports is partly about recognition, another way we
recognise our people is by having awards, both with and without prizes.
Every month we recognise milestones in achievement by store owners, and
annually at our conference we have a black tie Awards Evening of our
very own to recognise the achievers within our group.
</p>
<p>Achieving, in our team, is not a matter of having the largest
turnover. We have a fair system where it is possible for any owner to
win the Premier Award and gain recognition from the group. We award a
number of quite valuable travel prizes each year, and the one for the
Best Team Member is highly regarded by all.
</p>
<p>As has been said before, when you become a franchisor you stop being
an operator. Stirling Sports Franchises Ltd is a communications company
now, not a sporting goods retailer – it is the franchisees that sell
the sports gear.
</p>
<p>Our role is to create opportunities for our store owners, and teach
them to take advantage of what we create. Our prime function is to
communicate with them, and to help them stay motivated. Having the
right systems to collect information – and creating the right culture
to make it OK to share that information – is vital to fulfilling our
function as franchisor.
</p>
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<author>Colin Taylor</author> explains why sharing information is vital for keeping franchisees motivated
2009-07-23
105-caring-and-sharing