Franchise SME Business Transformation Case Study

Imagine a 50+-year-old family business that operated purely on love and loyalty. It had no business systems or processes, supplier agreements, brand guidelines or detailed customer experience strategy.

Despite being recognised internationally, the independently-owned business never saw the need to create repeatable systems or frameworks for its staff or distributors, and had no plan for growth.

After 54 years of operating, the business, built on love, loyalty and family, was starting to decline. Increasing competition, flat sales, falling margins and increasing costs. An absence of strategic and operating plans, and no meaningful  reporting, performance focus, KPIs or accountability, meant the business was unable to respond. The company hadn’t produced a new product for years! They were stuck and the market was moving much faster than they were.

A brand is the core of any business. When working with a 54-year-old company built on love, loyalty and family, transforming it with brand-centric business systems and respect for its values and brand heritage, was critical.

In collaboration with internal and external stakeholders, Karen transformed a fragmented distribution network into a systemised franchise model that respected the business heritage, the brand story and the industry.

The brand-led process was executed under a 2-year strategic vision and driven by transparency, respect, empathy, communication, bravery and determination. Respecting the heart and soul of the business whilst overlaying new processes and systems was the key to long-term success.

Led by Karen Matthews, every aspect of the strategic plan was bespoke. Designed specifically for the business, industry and all stakeholders, Karen took the founders and staff on a business transformation journey with an unwavering focus on the vision and goals.

Over two years, the company realigned strategically, operationally and financially. Karen’s business transformation strategies set it up for long term growth.

New business processes, financial planning, talent development and a commitment to implementation transformed a family business into a franchising powerhouse whilst upholding the brand’s heritage and strong family values.

A fragmented and disengaged network transformed into an aligned and engaged collective of franchisees, with a shared vision and love of the brand.

Australia’s first franchise model in the sector

A fragmented customer experience was consolidated into a brand-led franchise network of brand-aligned business owners. Over two years:

• Retail and wholesale sales increased more than 300%
• Profit returned and the balance sheet became cash flow positive
• Brand awareness exploded and market share grew

Distribution network consolidation

Alongside creating a tight-knit franchise network, Karen consolidated the brand’s fragmented retail presence to a single department store, David Jones. Exclusivity resulted in a string of wins, including:

• Improved operational expenses
• Reduction in operating costs thanks to a single Department store presence
• A consolidated inventory system reduced inventory holdings
• Improved trading terms delivered a significant improvement in cash flow. The business finally had cash in the bank!

Investment in product development and education

The combination of new product development and ongoing training built an engaged network of loyal and dedicated franchisees, translating into higher profit margins and a significant improvement in the bottom line.

• A new commitment to education saw the company invest in a state-of-the-art educational facility in NSW. Increasing student capacity by 380% improved the educational offer and resulted in franchisees delivering a consistent customer experience.
• A new focus and commitment to product development, including higher-margin categories, enhanced the brand’s market positioning, grew market share and delivered significant bottom-line improvement.
• Implementation of a strong performance culture created a motivated, engaged and ambitious team and franchise network. A simple and focused performance management system based on accountabilities, values and deliverables ensured implementation achieved longevity.