How is Ella Bache boss Pippa Hallas steering the beauty therapy franchise through significant change to reap dividends for franchisees with an average 21 percent growth in service sales?
A new services menu was the first change implemented as part of a larger four-year strategic development plan for the model.
“Over 30 percent of franchisees have made the change to the new services menu and the results are very positive.” Hallas reveals.
“The business recorded an 8 percent increase in total and service revenue, along with a 6 percent jump in retail turnover across the franchise.”
The new services and treatments are more high value and more profitable, says Hallas, which is good news for franchisees focused on their bottom line.
Listening to franchisees
“We listened to what our franchisees wanted, starting with a focus on getting more clients through the door. This led us to customer research, which revealed there was a disconnect in what clients understood we did versus the expertise actually available to them in our salons. We saw the opportunity immediately and conducted a full review of our service menu.”
The business is rolling out a new CRM system so Ella Bache can collate the data in a more sophisticated way that leads to greater personalisation in customer offers. “We’ve invested heavily in tech and we’ve relaunched our infrastructure – right back to the manufacturing – with a focus on digital communications platform.”
It’s a necessary move as 93 per cent of Australians are influenced in their purchasing by social media, Hallas says.
“It’s also making sure we have a team of experts internally who can do education innovation; dermal experts using new research to feed through to our undergraduates in our college, right through to the franchise network in postgrad training.”
Communicating franchise change
All this innovation comes at a cost but Hallas is rejecting a dictatorial approach to implementation in favour of an adaptable, in fact personalised, process for franchisees.
“We’re very mindful we have different sized businesses, from Bondi to Alice Springs and consumers have different demands and needs. It’s very much around customising the journey, so it’s right for the franchisee and the market and financially right for them,” she says.
“Change takes time, but we are pleased with the results so far and the positive feedback from our franchisees,” Hallas says.
“Whenever change takes place you’ve got two sets of people, the natural leaders and advocates for change, and the people who are fearful of change. We’ve experienced both and everything in between.”
Hallas explains the company started communicating changes two years ago, with a 2016 roadshow.
“It’s been a long, long process. That’s the been the key for me. Change takes time. But in every business globally you’ve got to change.
“We’ve learned a lot about change management. I’m an eternal optimist, I’m really excited, but I underplayed the fear that came up.”
Looking back, Hallas now would approach the change process a little differently and would simplify it.
“I overcooked it at the beginning and it gets lost in translation,” she admits.
A key role in substantial change is that of a strategic change agent with the specialised skills to effectively manage the process, she says.
“It’s about understanding how you do it, at what point do you communicate and at what level. It’s very complex. It’s not just a roadshow. It has to be done at every level of business. And done continuously.”
Hallas says it is a challenge to ensure the values of the brand are pushed right through to frontline operators, in this instance, young therapists.
“When you run a corporate business and you own corporate stores you can be dictatorial. In a franchise model you have to use a lot of influence, and persuasion. and you are responsible for a lot of small business people. They are mini GMs as well.”
Whether corporate or franchisee, each business has a team of people and payroll to manage, landlords to deal with and changes in social media to monitor.
Hallas is sympathetic to the load that franchisees carry in managing their own businesses.
“Keeping up with what’s going on is hard. You have to keep your foot on the pedal.”