The future of franchising: what to consider in 2017

Gavin Culmsee | General Manager | Bedshed

Gavin Culmsee | General Manager | BedshedGriffith University’s newly released Franchising Australia report tells a positive story for retail franchising, despite the flat economic environment Australia’s operated in over the last 12 months.

The report found that more than 470,000 people are employed in business format franchises, and that the retail industry dominates the sector, with 26 per cent of brands operating in this segment. While this is great news, the report does raise a few interesting issues. Predictions of a gradual decline in the number of franchise brands may concern some potential franchisees. However, it also predicts an increase in employment and sales turnover across the industry, confirming the sector is still a healthy option, provided you join the right brand.

But what is ‘the right brand’, and how can it be identified? I’ve been in the franchising sector for 20 years, and in that time I’ve picked up some valuable insights on what prospective franchisees should look for when considering a franchise.


One of the perks of living in today’s world is that we have a wealth of information at our fingertips. As a potential franchisee, you’re able to consider and scrutinise any potential franchise network with a fine-tooth comb. Any hiccups or red flags should come up pretty quickly.

Look for a network that has a proven track record and longevity in the market. A tried and tested network, with years of experience behind it, is going to mean more security and less risk for you. While you’re never going to know exactly what a franchise network is like until you join, one of your best bets is to look at existing franchisees in the network. How long have they been with the network? Can you gauge their level of satisfaction? Ultimately, you don’t want to be investing your money in a franchise that doesn’t have a proven record of success. If a franchise network can prove a history of satisfied franchisees and continued growth, then you’re in a much better place.

Future proofing

It’s critical for a franchise network to have a proven track record, but they also need to be able to demonstrate that they’re looking to the future. Look for signs that a franchise network is forward thinking and ready to evolve when new opportunities arise.

For sales based industries, online commerce is an obvious example of this opportunity. It’s no secret that rapid technological advancements and disruption are a fact of life in contemporary commerce. In order to stay relevant and competitive in the market, it’s essential that franchisors are keeping abreast of the latest technology and trends. The Franchising Australia report shows a third of businesses engage in online sales, which I expect will increase over the next 12 months and into the future. Franchises that do not evolve and offer online sales will in all likelihood be left behind. You therefore must consider not only how a franchise network engages customers in-store, but also online.

Online connections

Another essential factor to look for in a franchise network is how it evolves the instore experience. Is it taking steps to stay ahead of the game and adapt to the changing market? At Bedshed, this is something we are constantly striving to champion. For example, we recently implemented an industry leading store fitout (we call it our evolution fitout) which has been immediately effective in engaging and captivating the imagination of our customers while in-store and the corresponding sales growth has been tremendous.

Unique Selling Point (USP)

Each franchise network should have something that makes it unique and different to its competitors. Some franchise networks involve their franchisees in much of the business processes, while many others don’t. At Bedshed, we strive to differentiate ourselves by fostering an open, two-way healthy relationship between the Bedshed Central Office and our franchisees. We ensure our franchisees are always aligned with the network and encourage them to get involved in decision-making processes as much as they wish.

Other franchises may not offer this opportunity, so be clear about what is important to you and ask the right questions upfront to understand how much input you will have.

An example of how Bedshed involves and includes franchisees in the network is the operation of both the Franchise Advisory Council (FAC) and the Merchandise Advisory Council (MAC). Meeting once a quarter, the FAC contributes to business decisions on everything from operational matters and customer feedback to promotional and advertising campaigns. The MAC is responsible for product related decisions. Both councils are open to any franchisee that is willing to join. While it’s not compulsory for franchisees to participate, they present a fantastic opportunity for those wanting to get involved and share their opinion.

The product

It’s all well and good to have a franchise network that’s modern, innovative and successful. However, as a potential franchisee you must consider what it is you’re going to be selling, day in and day out. In 10 years’ time, will that product still be in demand?

One of the reasons Bedshed franchisees report successful operation and busy stores is because mattresses and bedroom furniture is always in demand. At the end of the day, people will always need a comfortable bed to climb into! It will always be advisable for them to change their mattress every seven years. Think carefully about not just the business model but the end product before you sign on the dotted line.

Gavin Culmsee is the General Manager of Bedshed, a national bedding and bedroom furniture specialist. With more than 30 years’ franchising experience, Bedshed has a long history of satisfied customers and successful franchisees. Bedshed is a trusted member of the peak body for Australian franchising, the Franchise Council of Australia. Bedshed is currently looking for franchisees on the east coast of Australia as the company continues to expand.

For more information contact Rod Parker on:

0419 494 480