Franchising – a hand to go solo

Sally Stone and her husband Mervyn founded Les Bon Voisins in 2002. The company provides an all-round service for homeowners in France from helping them to buy, to fixing broken windows.

The name Les Bon Voisins is now carried by 33 franchisees across France - 10% of whom are French. Mrs Stone believes setting up a franchise is ideal for people unfamiliar with French bureaucracy but warns that it is not an automatic key to success.

“Several couples on our network have said they would not necessarily have been a franchise in the UK but it was exactly that hand-holding that they needed in France," she said. “It's a way of setting up a business and becoming your own business without all the risks,” she added.

Franchising is strictly regulated in France by the 1989 Loi Doubin. Among other things this dictates that a franchisor must hand over a file containing the business accounts for the past two years, a list of franchisees, conditions of the contract, initial cost projections, a general market study and a local market study.

Mrs Stone said that a good franchise should also provide concept, know-how training and support. After the initial buy-in fee franchisees pay an annual charge to use the name.

There are no regulations about droit d'entree (buy-in fee) or ongoing returns to a franchiser. Mrs Stone said: “We have been advised by the French franchising consultancy that we have under-priced what we provide.

"Currently, there is a buy in fee of €7,500 and ongoing, 5% of gross turnover to be spent on advertising and 5% comes back to the network to ensure that the brand profile can be enhanced continually.

“The 5% advertising is split between regional advertising and network advertising. Many, many franchisers charge way more than that in terms of percentage: our consultant says that the 5% is an absolute minimum.”

A former marketing director for a legal service company, Mrs Stone said: “I was under no illusions as to the level of marketing and advertising you need. A lot of companies fall down on the amount of money and time they need to spend on advertising more.
“That's what we're trying to take away from others. One of the major advantages of a franchise is its profile. They are more visible. A lot of couples cold have done this on their own but they would not have been visible.”

The couple decided to set up their franchise when they were unable to find people to look after their home in France while they were in the UK.

“We looked around for people in France who could undertake and organize thing for us while we were in the UK. We could not find properly registered people and we realized this could be a niche.

“The more research we did we discovered that the French did not regard this a metier."

“From the beginning we thought about a franchise. The more research we did back in the UK before we came over the more I realized there was a niche. We ploughed a lot of money, much more than a couple on their own would do, secure that, if it worked we could franchise it and if it didn't no one would know we had lost a lot of money."

Six months into the business they were approached by a couple from the Charantes Maritimes who wanted to pursue a similar business.

"It was mentoring them, explaining all the forms which has now formed the basis six years on of a huge manual of instructions and a four-day training course," said Mrs Stone.

“We need to make sure that people are not wearing rose-coloured specs. They must not confuse franchise with guarantee. It's like buying a car. You still have to steer it and concentrate.”