SAFETY IN NUMBERS

Safety is big business, with compliance increasingly important to organisations.

Keeping tags on safety compliance is not only a way to build a business, but it can also save lives. Here are three vastly different franchises that prove the point...

Safety is big business, with compliance increasingly important to organisations. So what are the options for investment?

Sarah Stowe investigates...

SAFETYQUIP

SafetyQuip targets businesses with up to 200 employees, selling personal safety equipment, fire protection gear and respiratory clothing.

“We’re helping protect workers and avoid injuries and death,” says CEO Gary Shearer.

He believes small and medium enterprises are aware of the legislation with which they need to comply, but the issues can be so complex they do not have resources to properly deal with it. Advice is just part of the SafetyQuip service.

“Having been able to provide advice on the right equipment is one of our strengths. We’re not box providers, we’re about solutions,” says Shearer.

“Retailing is not our core business, although we have a presence. We’re about industrial distribution. In the time it takes for one person in a store to try on and fit a pair of boots for $99, we can ship product worth $10,000.”

Online sales comprise less than 2 per cent of the business, he says.

Franchisees out and about with clients can offer advice as well as product choice. So while franchisees often have sales experience, above all they need to have a personable nature and an affinity with the industry. Experience in the safety field is not needed to become a franchisee.

The businesses are territory based, and Shearer says satellite sites can be added at no extra cost to franchisees looking to expand.

Starting out with a small warehouse and van, the business can be built up to become a store and distribution hub.

The franchisor is fully focused on supporting the franchisee network. “We don’t run our own stores,” says Shearer.

That means that every two weeks the franchisor sends a data file updating the 15,000 stock keeping units (SKU), updating the database and website, which are all linked to the product catalogue, referencing the page number relevant to each product.

It is important for stores to have at least one other employee helping the franchisee, and often that starts out as a spouse or partner. Franchisees who develop their businesses can take on up

to 10 staff members.

SafetyQuip has a three-tier marketing policy - local-area marketing managed by the franchisee using material provided by the franchisor; regional marketing managed by groups of franchisees; and national marketing.

“There are a lot of players in the market, but our business model is working for us,” says Shearer.

APPLIANCE TAGGING SERVICES

Appliance Tagging Services has a targeted client base: facility managers, retail networks, government departments, schools and universities.

GM/co-founder Sarah Allen says that increasingly these organisations are directly contacting ATS to inquire about services.

“There’s definitely more awareness about the requirement for these services. We can see our website traffic is up because people are searching ‘What do I need to do about testing and tagging?’. Our information page gets the most traffic on our site.”

When potential clients approach ATS, there is a strong element of education. “They’ve often had the wrong advice,” says Allen.

Despite improved understanding about the need for equipment testing, she believes safety compliance is underdone, with only about 10 per cent of organisations using services.

When ATS spotted a gap in the market, the decision to double its portfolio of services made perfect sense. Now the franchise network can offer four services: electrical testing and tagging, and testing safety switches, which have been the core services; and now testing fire extinguishers as well as exit and emergency lighting.

Allen estimates that 98 per cent of ATS franchisees provide all four services, which is a boon for the customer base of large organisations that often work interstate.

“They don’t want to deal with multiple providers across different states and services. We call them a month before the due dates to schedule a service; we can send an invoice for each site or a consolidated invoice; and the client has one point of contact if something goes wrong.”

Allen says the services are priced on a unit basis.

One particular support service is valued above all others by franchisees - “We invoice on their behalf, and they are paid each month whether or not the client has paid us,” says Allen.

Investing in an ATS franchise will cost from $51,500, and a suitable vehicle is also needed.

Ongoing fees are percentage based, with the marketing fee included into the one package.

There are two different percentage options, depending on whether the client has been provided by the franchisor, or has been sourced by the franchisee themself.

“About 75 per cent of clients are provided by us,” says Allen. “We have a team of 20 and they do the scheduling.”

FCF FIRE & ELECTRICAL

Franchisees can join this business model without any technical qualifications. However, electrical contractors who are a year into their business are the perfect potential franchisee for this business with

its focus on electrical and fire compliance for domestic and business clients. Firesafety advisors are also well-placed to take on a franchise, says franchisor Jacob Foster.

But finding good people is a challenge because electricians are reluctant to upskill, despite the opportunity to earn a better salary as a fire technician, he says. “It’s more competitive, but people don’t realise how difficult it is. It’s the compliance behind the scenes.”

Franchisees will spend the greatest part of their time in the field, either cold-calling potential clients or servicing clients. The rest of the time is spent on administrative tasks. The model suits husband-and-wife teams with its Monday-to-Friday hours, although there are demands to be on call 24 hours a day.

As franchisees build up their businesses, they can employ staff (the employee count is typically five) and choose to continue to be hands-on or hand over day-to-day processes to a manager.

It is a territory-based franchise model. Local leads are sourced through the marketing team, and by franchisees themselves. National clients are targeted by head office.

The most popular franchise package costs $45,000, with ongoing fees of 8 per cent. That includes insurance, fuel and stock discounts.

And which service or support do franchisees value most? “Technical experience,” says Foster. “Nothing beats having a guide who can help out in a tough situation.”

While franchisees often have sales experience, above all they need to have a personable nature and an affinity with

the industry.