Three of a kind? Perhaps not ...

07 September, 2007

Following your Fascia magazine supplement (Aug 24) , I felt that I should write to correct what I see as a misunderstanding that underpins some of the editorial content of the supplement.

Within the introduction you treat "fascia groups", "symbol groups" and "franchises" as mutually interchangeable terms.

While this may be true of the first two - symbol groups and fascia groups are effectively the same thing - it is certainly not true of the third.

A true franchise is something quite different to a symbol group - ask famous franchises like McDonald's or Subway and they will tell you

they pride themselves on

group disciplines that ensure

the end consumer sees the group as a chain. No symbol group would claim to be a chain in the same sense that companies like these are - as a customer you "know" what you're going to get when you walk into a franchise, but this is not always so with a symbol group.

I should note that symbol groups have an important role to play in our marketplace and I'm not knocking what they do.

For many independent retailers there is a measure of security to be found operating under a symbol. A symbol group is a halfway house between remaining a stand-alone independent

and to an extent giving up independence

to becom e part of a disciplined professional retail chain .

The fact is that a franchise group - whether it's McDonald's, Subway, or Bargain Booze for that matter - has centralised controls, centralised pricing, centralised ranging, centralised buying, centralised marketing, in fact, centralised everything. This centralisation brings not only retail credibility as part of a chain, but also significant operational savings in time for the franchise retailer.

The franchisee is still the owner of his or her own business. He or she is still the person in control of that business - and control is the key word . The retailer has access to data to understand what is happening in his or her business, without having to wait for the accountant to tell them whether they are making any money or not . However, each individual business exists as part of a wider framework - a chain that is highly credible in the eyes of the marketplace and

consumers.

Matthew Hughes

joint managing director, Bargain Booze




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