MILE­STONE MAGIC

Pool­w­erx has just passed a sig­nif­i­cant mile­stone, the magic 100 fig­ure across three met­rics: 100 fran­chisees, 100 stores, $100m group turnover.

Inside Franchise Business - - Contents - By Sarah Stowe

Pool­w­erx’ $100m turnover just one of three tar­gets met.

To­day Aus­tralian store num­bers to­tal 118. Adding in the US busi­ness takes the fig­ures to 150 fran­chisees, 150 stores and $150m rev­enue.

Re­flect­ing on the achieve­ment John O’Brien, Pool­w­erx founder and CEO, says “We set the $100m tar­get three years ago for group rev­enue. We achieved it in Aus­tralia with three days to go in June.

“Some­times we don’t look back enough and cel­e­brate our wins. It’s like all these things, they look big when you set the goal, then when you reach them, you think ‘What’s next?’ ”

What’s next for Pool­w­erx is fur­ther sig­nif­i­cant growth with the bur­geon­ing US busi­ness close to match­ing the home-grown tar­gets.

“Our five-year plan for Aus­tralia and the US is al­most aligned: 300 stores and 1000 vans across Aus­tralia, and the US is al­most iden­ti­cal.”

How­ever growth hasn’t been a smooth up­ward tra­jec­tory. In fact, the num­ber of fran­chisees has gone down from a high point of 140 fran­chisees 10 years ago.

O’Brien ex­plains what hap­pened.

“We re­alised we didn’t want to be a man and a van busi­ness but to be in busi­ness with fran­chisees who are busi­ness peo­ple.”

The goal of cut­ting back fran­chisees was a dif­fi­cult mes­sage for O’Brien to de­liver at the na­tional con­fer­ence all those years ago. But by work­ing with fran­chisees to part­ner with other fran­chisees, the busi­ness achieved both a re­duc­tion to 70 fran­chisees and an in­crease in sales and rev­enue.

“We im­proved the rev­enue of in­di­vid­ual fran­chisees,” said O’Brien. “Now we have 100 with rev­enue close to $1m each. We have five key KPIs and the num­ber one, not talked about much in fran­chis­ing, is to in­crease the av­er­age EBITDA plus owner’s earn­ings. A key driver is to in­crease prof­itabil­ity.”

That KPI has been in place for a decade and that’s en­cour­aged fo­cus from the whole Pool­w­erx team, for whom 10 per cent of their salary is a bonus al­lied to key met­rics.

“The big­gest weighted bonus for our staff is that KPI. That fo­cuses every­body,” says O’Brien.

The av­er­age EBITDAO to­day is 25 per cent.

O’Brien says the qual­ity of in­com­ing fran­chisees has helped boost busi­ness too, and the av­er­age Pool­w­erx fran­chisee ten­ure is eight years.

“Hav­ing a greater fo­cus on bet­ter qual­i­fied and busi­ness part­ners as we’ve grown, been awarded and prof­itable, means the abil­ity to at­tract good fran­chisees is greater.”

He says one of the fran­chisor’s key re­spon­si­bil­i­ties to the fran­chise net­work is “to keep look­ing un­der rocks to find the next op­por­tu­nity so fran­chisees can stay and grow within the brand”.

Over the last two years the busi­ness has heav­ily in­vested in a new PoS, a sys­tem based on Net­suite. This al­lows fran­chise part­ners across the net­work to run their busi­nesses more ef­fi­ciently and use real-time met­rics for mea­sure­ment.

“That’s what you want when you in­vest in a fran­chise, to mea­sure your­self against your peers.

“We’re fairly en­tre­pre­neur­ial. We en­cour­age you to have as many as you can have, if you do the train­ing and qual­ify. If you go a step too far, we’ll help you take a step back.”

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