Our "A Man's Toyshops" are unique in our
industry so this is an ideal opportunity for owner/operators
to be leaders in our specialised business. Please
read through the following documentation and at the
bottom of the page you will find a link to the application
form that you can send in over the internet.
For further information and details Phone
Arthur Clarke or Ross Mylrea on
What is franchising
Here are answers to some of the most common questions
asked about franchising.
Franchising is a method of marketing and distributing
products or services. At least two levels of people
are involved in the franchise system, (1) the franchisor,
who lends the trademark or trade name and the business
system to (2) the franchisee, who pays a fee for the
right to do business under the franchisor's name and
does a franchise chain start?
Imagine a store owned by an individual with a particular
concept. If the business is successful, the owner
may develop a second or third store and hire employees
for the day-to-day operation. At that point, if the
owner still wants to expand but prefers not to own
and operate additional stores, he/she may decide to
'franchise' the store name and business system to
an independent business person - the franchisee. In
return, the franchisor may ask for an initial fee
and continuing payment based on a percentage of that
franchisee's sales. The business is now franchised.
widespread is franchising?
There are more than 700 franchised companies in Australia.
This has grown from 184 in 1988. Officially:
AUSTRALIA 1998, Survey by University of Southern Queensland,
- There are 730 franchisors
- The total turnover of
the franchising sector was $81.4 billion for the
1998 financial year.
- The total number of employees
working in franchise systems was 583,000 consisting
of 167,000 permanent full-time, 34,000 permanent
part-time and 382,000 casual employees. In addition
there were 95,000 employed in automotive fuel and
motor vehicle retail franchises.
- In 1998 the number of
business outlets operating under franchise was 50,100
of which 38,500 were operated by franchisees.
are the major growth sectors in 'business format franchising'?
As we become a more service orientated economy, as
more women enter the workforce, and as a larger percentage
of the population grows older, growth areas in franchising
are responding to these changes. While it is important
to consider industry growth before investing in a
franchise, it is more important to analyse an individual
franchise company's track record, keeping in mind
that quick growth does not always spell success. A
franchise organisation that grows too quickly might
not have a service team in place to support all of
the units properly. Overall, long range trends indicate
a steady, solid growth in business format franchising.
Some will fall by the wayside, as is natural with
any business, but others may well be the 'household
name' franchise success stories of tomorrow.
kinds of business lends themselves to franchising?
Most service and retail based businesses lend themselves
to franchising. The international Franchise Association
(IFA) lists more than 60 categories to describe it's
members. Printing and copying services and real estate
are excellent examples of successfully applying franchising
to established industries.
should I consider before buying a franchise?
- The type of experience
required in the franchised business,
- A complete description
of the business,
The hours and personal commitment necessary to run
- Who the franchisor is,
what his/her track record has been, and the business
experience of officers and directors of the company,
- How other franchisees
in the same system are doing,
- How much it's going to
cost to get into the franchise,
- How much your going to
pay for the continuing right to operate the business,
- If there are any products
or services you must buy from the franchisor and
how and by whom they are supplied,
- The terms and conditions
under which the franchise relationship can be terminated
How many have left the system in the past few years,
- The financial condition
of the company and it's system.
can I be sure that the information provided in the disclosure
documents is truthful and accurate?
The mandatory Franchising Code of Conduct
places very strict conditions on disclosure of franchise
offerings, with remedies for breach available under the Trade
Practices Act and recourse to the full force of the ACCC. Even
though inaccuracy and misrepresentation carry civil and
sometimes severe criminal penalties, there is no way to be
absolutely sure. With the Trade Practices Commission's
disclosure requirements, however, fraud and deception are less
likely because at the very least the franchisor has answered a
variety of very important questions that you can use to judge
the offer. The history and reputation of the company and it's
officers are also extremely important in this regard.
there any other laws which protect me?
There are always adequate laws in place to protect
those in a business relationship. The federal Government's
"New Deal: Fair Deal" response to the Fair
Trading Enquiry determined that the franchise sector
required even greater regulation. As a result, from
October 1998 franchisors are required to abide by
the Franchising Code of Conduct which is in effect
franchising legislation. Australia now has the most
regulated franchise sector in the world with onerous
requirements of disclosure - more than public officers
and disclosure of financial information as far back
as 10 years.
I make a successful franchisee?
A successful franchisee should be suited to the industry
which he or she intends to join, suited to the particular
franchise company and suited to the franchise system
generally. Important questions to ask yourself include:
am I suited to the industry physically and by experience,
education, learning capacity, temperament and financial
ability? What type of work is most appealing to me?
For example, do I enjoy working with food? Mechanical
things? People? Property? Books? Computers? Sporting
goods? Etc. Am I prepared to work hard and take a
financial risk? Do my advisers, family and friends
think I am adaptable and trainable? How do I react
to controls? Am I a loner, resisting authority and
restraints, or can I accept guidance and direction
happily? How do I personally feel about the company's
image, products and services? The right answers to
these questions help determine your potential success
as a franchisee.
franchised businesses have a better chance of success?
Surveys conclusively show a very strong success rate
for franchise owners. Whereas the failure rate for
independent startup businesses is approximately eight
out of 10 (within five years of starting), franchising
has the opposite ratio of success where more than
nine out of 10 are still operating after five years.
This is one reason why it is easier for would-be franchisees
to borrow from banks, especially if the prospective
franchise is listed on their 'safe' list.
do you explain the success rate for franchised business?
The franchising system is designed to provide a pretested
formula for success, plus ongoing advice and training.
Many of the unavoidable business mistakes have been
worked out of the system through experience. Most
independent businesses fail because of lack of management
skills. With a franchised business, your franchisor
should be eager to help you overcome problems. Your
hard work and the franchisor's expertise spell a strong
partnership. No one can be 100% sure of success. Although
the vast majority of franchise owners are satisfied,
successful business people - some do suffer financial
loss. Regardless of earnings claims made by the franchisor,
recognise that success or failure ultimately depends
are some of the drawbacks of being a franchisee?
In exchange for the security, training and marketing
power of the franchise trademark, you must be able
and willing to give up some of your independence.
If you are a person who likes to make most decisions
on your own or to chart the course of your business
alone, a franchise may not be right for you. As a
franchisee you will be required to comply with the
various controls and procedures established by the
franchisor. Then too, all successful businesses require
a lot of dedication and plain hard work. You must
be prepared to make that commitment.
is the annual growth rate of franchising in Australia?
Annual growth in the number of franchisee-operated
outlets has averaged 17% compound between 1994 to
(USQ survey, August 1998)
are the main areas for consideration in choosing a
When investigating the purchase of a franchise there
are six key areas for consideration. They are:
- What will the franchisor
do that you can't?
- What territirial protection
do you receive?
- What help can you receive
if things do not go totally as planned?
- How much of the marketing
budget will be spent in your area?
- Terms and conditions,
- The Franchisor's negotiations
- on your behalf - with leasing agents, centre management,
financial institutions, suppliers and others.
is the best advantage that franchising has over independent
Franchisees are never alone, which is one of the best
benefits that one could hope for in this tough business
world. On one hand they have the franchisor to support
them and on the other they have the franchisees who
are having parallel business experiences. Furthermore,
as a franchise matures, the brand name and trademark
becomes more valuable. So as franchisees consolidate
in the marketplace they are actually adding value
to the group as a whole. Similarly, as a franchise
grows in numbers, the multiplication of sites creates
a stronger market presence, which benefits all franchisees.
Not a lot gets done in around fifteen minutes does
it? Think about it. How long does it take you to drive
to work each morning? Most of us take fifteen minutes
for smoko and an hour for lunch.
On average, people spend around half an hour reading
a newspaper. Mowing the lawn can easily take an hour
or more, and preparation of the family dinner can
take far longer. Even watching the evening news consumes
half an hour!
All the more amazing then, that someone, somewhere
in the world, opens a franchise every fifteen and
a half minutes! imagine what that means to business.
Every sixty-two minutes the business world gets four
new franchise businesses. Every year, nearly 40,000
new franchise businesses are added. By the year 2000,
there will be nearly one million franchise businesses
dotting the cities, suburbs, and country side's of
Now these figures from the University of Southern
Queensland point to a dynamic and fast-growing franchise
sector in Australia.
As of mid-1998, business format franchises (not including
petrol retail and motor trade franchises) employed
583,000 people in 43,800 franchise outlets.
Growth continues to accelerate to around 17% per annum.
Franchising is a marketing tool that can be used to
sell almost any product or service - from home services
to footwear, from educational products to donuts,
from car detailing to coffee.
What does all this mean to you?
As a consumer, it means by the end of the year 2000,
you'll spend nearly half your retail dollars in franchise
As a wage earner, it means you may become part of
the franchise workforce which currently employs in
excess of eight million persons worldwide and over
half a million here in Australia.
And it may mean a business of your own!
On the other hand, franchising might not mean a thing
to you. As a consumer, you won't escape buying from
a franchise (you probably do it now without even knowing
it), but you certainly can avoid working in one, and
most people will never own one. In fact, most people
should not own one.
However, because you're not like most people, you're
probably reading this because you're looking for new
challenges and considering a business venture.
So chances are that franchising is about to have a
big impact on your life, your future and your ultimate
'A Man's Toyshop' as a franchisee?
A Man's Toyshop is a unique
retail concept, having no parallels in our industry.
Yet it's also a time tested and proven business.
Boasting strong and proud regional Queensland origins,
A Man's Toyshop was established in 1974 by Ross Mylrea
to provide tools and specialist supplies to farmers,
builders, workshops, contractors and experienced handymen.
Since then, the company has prospered through a firm
focus on providing our vast and ever growing client
base with unequalled service excellence in terms of
product range and quality, industry knowledge and
expert advice, responsive service and value for money.
A Man's Toyshop will source specialist requirements
from anywhere in the world. Our ongoing efforts in
meeting customers' expectations have developed a very
strong customer following. This is enhanced through
our very active VIP club with personalised mailings
every second month and catalogues twice a year.
Ross Mylrea and team recognise that to the majority
of our customers, simply selecting the cheapest product
with the lowest price is not always the best choice.
That's why we are continually expending our time and
energies in areas such as assessing customer needs
and preferences, improving avenues of customer communications,
the procurement of new and better products, improving
service delivery and methods for quick turnarounds
on orders, and in developing an overall awareness
and understanding of our customers' individual and
Our team's extensive industry knowledge, a huge range
of quality products and value added services are supported
by a highly competitive pricing structure, as we recognise
that our customers have budgets... and that meeting
those budgets is paramount to their sustained growth
To help service the growing number and spread of customers
attracted to 'A Man's Toyshop' it has been decided
to expand into franchising. To best position the company
for this move, what may be considered an unusual tactic
was undertaken. Ross Mylrea and his management team
started to dissolve the business processes and existing
procedures to start from scratch. All stores were
sold except the Rockhampton business, which is being
used for restructuring and testing the internal company
This restructuring also included development of an
in-house computer software system that Ross Mylrea
and one other team member have devoted over 4,000
hours to - not to mention the 25 years of hands-on
experience. It is a system that Ross believes is A
Man's Toyshop's competitive advantage when it comes
to customer service delivery.
The company and our people are now ready to pass on
not just this innovative system, but also the others
that we have nurtured over the past two years in preparation
to enter the franchise arena.
in a franchise?
If you start a new business today, unless you have
extensive experience in the specific industry that
you are going into, the odds are stacked against you
It's generally recognised that around four out of
every five new businesses will fail within five years.
The primary reason that the failure rate is so high
is because the owners have to go through the learning
curve of operating that specific type of business.
Unfortunately, the marketplace is not very tolerant
of new inexperienced owners attempting to learn how
to operate a new business.
And if you've chosen an extremely competitive industry
to try your hand, you may get swallowed by the sharks
very quickly. You may go under, you may lose some
or all of your money, your credit, your home, your
reputation and sometimes even your family. Failing
in business can be an horrific experience.
Compare this with franchising which enjoys a success
rate of over 80%. Very simply, franchising is a business
model structured around risk minimisation. Franchising
is as close as you will find in today's marketplace
to a guarantee of success.
All the studies done have found that franchise new
business startups rarely fail, and when they do it
is usually because the franchisee did not stick to
the franchisor's systems.
In all human endeavour there is a learning process
involved. This learning process requires going through
a series of trial and error encounters wherein knowledge
is gained by trying and failing, trying and failing
again and again and eventually trying and succeeding.
This process is generally called the learning curve.
In the context of franchising, the franchisor has
already gone through the learning curve and has learned
the secrets of success for the specific business.
In franchising all that has been learned by going
through the curve is transferred to the franchisee.
This is without doubt one of the major benefits of
joining a franchise, to minimise risk and give yourself
the best possible chance to succeed.
Another reason why it is prudent to join a franchise
is that a franchise investment can be thoroughly researched
before any significant expenditures are made. With
a new business startup (non-franchise) you are always
operating in the dark. No matter how much research
you do it is very difficult to get a handle on so
many aspects of the new business.
With a franchise, the franchisor has a wealth of information
about the business, from the customer mix, to the
best way of stocking your shelves.
Another very important reason to join a franchise
is intertwined into its basic nature. Franchising
inherently leads to strong growth, because the franchisees
provide the expansion capital. There are few restraints
to growth in franchising. As a franchise system expands,
many positive things begin to happen. The name begins
to become well known because people see it everywhere.
Most people associate size with success. The bigger
the franchise the better it must be. The large number
of units enables the franchise to advertise heavily,
which tends to increase sales. A synergy begins to
be created in which success builds success. The franchise
can buy products in large quantity at significant
discounts which it passes on to the franchisees. The
synergy just grows and grows.
A recent Gallup Poll of franchisees found that over
94% considered themselves successful and that over
75% would join their franchise again if they had to
do it over.
In summary the primary reason you should join a franchise
as opposed to starting up a non-franchise new business,
is to minimise risk and enhance your chances of success.s
Yes, I am interested
in "A Man's Toyshop" franchise