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How Lipo Slim Ensure A Real Return On Investment

With franchisees seeing ROI in three to six months, 3-in-1 Lipo Slim has a simple yet effective franchise offer that prospective franchisees can benefit from.

Nadine Todd

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Vital stats

  • Players: Hermarie Prozesky and Amelia Roux
  • Franchise: 3-in-1 Lipo Slim
  • Launched: 2014
  • Visit: 3in1liposlim.co.za

Hermarie Prozesky and Amelia Roux launched the 3-in-1 Lipo Slim franchise concept in 2014, after five successful years of developing an effective product line and business solutions.

“By 2014 we were offering a business in a box,” explains Prozesky. “We believe in simple, effective solutions. This meant a product line that was not only effective, but could prove its own results, as well as business training manuals that could assist our clients to set up and run their own salons.”

The problem was that although they offered their clients a full package solution, each salon was still its own entity. Prozesky and Roux had no control over customer service, salon hygiene or the overall client experience, but because their branding was on all the equipment and products, they were receiving complaints from salon clients.

“We realised that we had already developed everything necessary to launch a successful slimming salon franchise, and so we decided to take complete ownership over the entire customer experience through a franchise model,” says Roux.

Related: Beauty And The Business: How The Diva Slimming And Aesthetics Centre Is Full Of Opportunities

Developing a successful business offering

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3-in-1 Lipo Slim is the product of five years’ worth of business development. “We went into business together in 2009 selling consumables to salon owners,” says Prozesky. “This included facial sponges, pedicure ranges, waxing products and so on, but we received a lot of queries about slimming products.

“We realised there was a huge demand for slimming and body sculpting products, and if we could find the right products, it would translate into a big opportunity for us.”

Prozesky and Roux started researching what was available, both locally and abroad, and imported a number of different machines that they tested themselves.

They launched with the Fir Sauna Blanket in 2010, which was such a hit that the entrepreneurs say they ‘killed the market’ with it.

This success was followed in 2011 with a lipo laser machine. “The two machines work well together, and so we started selling not just equipment, but a body slimming and sculpting solution,” says Roux.

This offering was increased when they discovered the Inbody solution through a local distributor. “Inbody measures and tracks the effectiveness of our other equipment,” explains Prozesky. This added huge value to Prozesky and Roux, but more specifically to their salon clients. Now they had a three step solution that could be measured and tracked, offering visible proof of the changes their clients were experiencing.

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“We also started developing business training manuals to assist our customers,” says Roux.

“Many of them either didn’t have business backgrounds and were setting up businesses for the first time, or were looking for assistance in how to run more successful salons.

“There’s power in simplicity. We like to distil everything down to core concepts that can be easily understood and implemented, and we’ve found that this is as true of product offerings as it is of operating a business.”

By 2012 the partners were also ready to develop their own slimming range.

“We partnered with a pharmaceutical company to develop the range,” says Prozesky. “We use all natural products, and the range includes a thermogel, detox caps, CLA caps, meal replacements, and detox oils.” In keeping with Prozesky and Roux’s approach to business, it’s a simple yet elegant and essential range.

“We’ve kept the price point so reasonable that our customers can add a 100% mark-up, when the norm is 30% at the most,” says Roux. “These products all work alongside our machines, and were a nice step in the door for us with new customers.”

Related: 3 Secrets To Franchising Success

Developing a franchise concept

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By 2014 Prozesky and Roux had developed a three part body slimming and sculpting range, complete with products and business manuals. They had also started importing the Fir Sauna Dome, a sophisticated dome that included vibrating pebbles. The Fir Sauna Blanket was exclusively reserved for customers to purchase and use at home.

“All the elements were in place, and when we realised that customers were looking for a predictable, quality experience, franchising seemed like the natural progression for our brand,” says Prozesky.

Two packages are on offer, and they include everything the franchisee needs to set up their business, from the machines, furniture and décor, to product and business training.

“Once set-up is complete, operating costs are low,” says Roux. “This means that the business quickly becomes cash positive. We say return on investment happens in three to six months, but we’ve had one franchisee who achieved ROI in two months. It just depends on how hard you’re willing to work.”

Prozesky and Roux’s ideal franchisee wants to start their own business and be an owner/operator working inside the salon.

“We’ve designed the system, but we’re not here to run businesses for our franchisees,” says Prozesky. “We give you the tools, but your commitment will be what determines your success.”

Ongoing fees

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Franchisees must commit to purchasing R7 500 worth of product from the franchisor each month. This secures a radius of 10 000 people and ensures there will be no other franchisees in your radius.

Marketing fees are R20 000 per year, and cover Google adwords, ads on the franchisor’s website and other marketing. The first year is free.

Related: Pay Attention To The Small Print

PACKAGES

PACKAGE 1

Set-up cost: R650 000
Operating capital: R100 000
Size of salon: 80m2 or two rooms
Set-up
includes:
1x lipo laser that can service two clients simultaneously in a partitioned room.

1x Fir Sauna dome.

All the furniture needed to set up the salon, including two beds, a coffee table, desk, couches, décor, canvases, door wrappings, branded towels, the POS system,
marketing system and
display cabinets.

PACKAGE 2

Set-up cost: R750 000
Operating capital: R100 000
Size of salon: 80m2 to 120m2 or four rooms
Set-up
includes:
1x lipo laser that can service two clients simultaneously in a partitioned room.

2x Fir Sauna domes.

All the furniture needed to set up the salon, including two beds, a coffee table, desk, couches, décor, canvases, door wrappings, branded towels, the POS system,
marketing system and
display cabinets.

With this package, four clients can be treated every half an hour.


Additions to packages

  • Facial package: Includes a scanner that reveals skin problems, and microderm and microlaser machines that treat skin blemishes, wrinkles and so on. Results are immediately evident.
  • Waxing package: Includes everything needed to offer waxes to clients while they are enjoying other treatments.

Nadine Todd is the Managing Editor of Entrepreneur Magazine, the How-To guide for growing businesses. Find her on Google+.

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Franchisors

Get Your Franchise Running Smoothly – Even When You’re Not There

Does the thought of taking time off from your franchise outlet make you nervous? Then you have to learn to run your business instead of letting it run you.

Diana Albertyn

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“A sign of a successful business is one that can operate without your physical presence 24/7,” says Brad Sugars, start-up expert, author and founder of ActionCOACH. While your franchise systems and operations are designed to run smoothly and consistently, is your staff trained to be productive in your absence?

“Franchises are already by nature systematised operations, so it boils down to how you as a business owner hire and train people to get the necessary jobs done,” says Sugars.

If you know a sick day will cause havoc in your store, an assessment of how you’re running your business is needed. Are you really running a successful franchise if things fall about without your supervision? Take a step back and consider the following steps to manage your franchise without it controlling your life. Pretty soon you could book that vacation.

Determine your role in the franchise

Are you managing the franchise, taking orders, doing admin and handling every other aspect of the business? Then you’re not hiring the right people, because those roles should be filled by people who can be left to carry them out unsupervised.

Related: How To Write An Operations Manual For Your Franchise

“And if you don’t have the right people for the job then it might be time to start hiring, so you can free up your franchise’s most valuable resource – you,” says Pieter Scholtz, co-Master Licensee for ActionCOACH in Southern Africa.

“You need to get an idea of how you can hire people to take repetitive or administrative tasks away from you. Ask yourself: ‘Do I really need to be doing this?’” says Sugars. Your business cannot run optimally if you’re the single most-knowledgeable and capable person there.

Lead with clarity

You have long-term goals for your business, perhaps even acquiring more locations and running multiple units. While growth is good, you need to share the load and ensure everyone employed in your business is working towards the same goals, otherwise, it’ll be difficult to get there. Sugars suggests asking yourself the following:

  • How will you make your vision a reality?
  • What makes you different from other franchisees and business owners?
  • What kind of team do you want to recruit and create?
  • How does all of this deliver value to your customer?

Conveying your vision can help ensure employees know how to get to the end-goal faster and more efficiently.

Related: 3 Steps To Ensure Your Franchisees Flourish Your Support System

Plan for long-term cash flow

Loyal customers ensure a constant flow of cash through the franchise and this requires exceptional service and the building of strong relationships. “Target your top-spending customers and establish a good relationship with them for long-term cash flow,” Sugars suggests.

Although the broader campaigns are covered by the marketing fee you’re paying to your franchisor, it’s wise to focus on your local’s tastes and suggestions when looking to deliver an experience worth returning for.

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Franchisors

Are Your Employees On Board With Your Franchise’s Brand Promise?

You cannot run a successful franchise if your staff isn’t aligned to the brand’s values.

Diana Albertyn

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Are the people who work in your franchise outlet familiar with the franchise’s brand promise? As a franchisee, you’re required to deliver a uniform experience, so any customer who walks through your door feels like they’re at the same store the franchisor has across multiple locations. If your employees aren’t able to embody the franchise’s brand promise at every interaction, you have a challenge on hand.

“If your company’s brand promise is a warm and friendly atmosphere, you can’t deliver that if your employees aren’t warm and friendly,” says Robin William, Senior Practice Consultant at Gallup.

“Selecting the right employees is essential to providing the right brand service. Hiring people who can’t behave the way the brand wants them to will doom a service initiative.”

Related: How To Write An Operations Manual For Your Franchise

When employees know what’s expected of them, they’re able to keep the promise the franchise makes to customers – leading to higher customer and employee engagement, trust, and revenue.

More than a mission statement

Even if you’ve ensured every one of your staff members know the brand’s mission statement, how can you be sure they’re able to exemplify it in their behaviour every day? William suggests that you do the following:

  • Create structures and mechanisms to consistently instil brand values in the franchise’s culture.
  • Discuss brand behaviours daily.
  • Demonstrate brand behaviours yourself every day.
  • Praise the efforts of individuals who demonstrate brand behaviours.
  • Hold employees accountable for not exhibiting brand behaviours.

Once you’ve clearly defined the right brand behaviours, it’ll be easier to have staff on board who deliver your franchisor’s brand promise.

Internalise the culture

Here’s a conundrum. Do your staff know what to do in a situation where a customer’s request might not be aligned with the brand promise, but the brand promise is always to deliver on customers’ requests? It’s a tricky situation, but if you’ve clearly articulated the promise, your staff will know how to “Behave the brand”, says William.

“Do whatever it takes to deliver on its brand promise. Whether it’s focusing quality, fast service, customer care, or low prices,” he says.

“Employees must execute brand and service behaviours consistently, and frequent reminders can help employees understand and internalise these behaviours.”

Related: 3 Challenges To Establishing A Franchise System And How To Overcome Them

Empower your staff

Investing in your staff is the best way to encourage them to act in line with your brand’s promise. Once they understand why it’s important to act along the lines of your brand, they will feel empowered and motivated to do so.

Starbucks trains employees to memorise customers’ names and preferences in line with their promise of making everyone who visits their stores feel at home. Apple’s strategy of hiring nice, smart people who are passionate about service and the product aligns with the company’s belief that knowledge can be improved, but personality cannot.

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Franchisors

How To Write An Operations Manual For Your Franchise

After establishing that your business is franchise material, ensure you’ve created a clear roadmap to success for your franchisees.

Diana Albertyn

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Documenting the replicability of your business is key to launching a viable franchise operation. Without manuals and instructions on how exactly you carried out your concept to its current level of success, your franchisees won’t accomplish the results you anticipate.

“Unless you can capture your business on paper, you cannot claim to have a business system to sell. Even detailed documentation may not be enough,” says Franchise Direct’s Lorraine Courtney.

“You may need to provide structured education programmes for new franchisees and their staff to teach them your business system.”

With the help of an experienced franchise consultant, you can devise the critical document that contains all the aspects of what make your brand successful.

Related: 3 Challenges To Establishing A Franchise System And How To Overcome Them

Why you need a franchise operations manual

If you’re second-guessing the importance of crafting an operations manual, then you shouldn’t go into franchising. “Your operations manual is your go-to document for deciding who is responsible for what in any franchisor-franchisee relationship,” says Dani Peleva, Managing Director at online marketing agency, Local Fame.

According to Peleva, your manual should generally include each franchisee’s contractual obligations to you as well as the complete details on how you expect them to fulfil these obligations.

“On a basic level, it tells your franchisees what you expect of them. It gives them all the information that you’ve accumulated while operating your franchise,” says Peleva. After familiarising themselves with this manual, franchisees should know how the information can be used to build their own business up to be as successful as the original store.

What an operations manual will do for your business

When all your franchisees know what’s expected from them as they run their respective locations, the entire brand is then able to provide a cohesive, coherent customer experience, which is crucial to your success as a franchisor.

A good manual will also help you build better relationships with your franchisees as they won’t need to constantly contact you to clarify aspects of the business they’re not sure of. If they’re applying the information in the manual, they should know everything you know about how to run this type of business, meaning they’ll make good profits – for you and themselves.

Related: 3 Steps To Ensure Your Franchisees Flourish Your Support System

“One of the steps most potential franchisees make before signing an agreement will be to contact your other franchisees. A strong manual will help your current franchisees return positive feedback,” adds Peleva.

How to decide which elements to include

Obligations detailed in your franchisee agreement will have to correspond with steps on how to achieve them in your franchise manual. As a new franchisor, you cannot be expected to have a manual as thick and wordy as your established counterparts.

Peleva suggests covering aspects such as:

  • How to set up a franchisee location and start trading
  • How daily operations will be conducted
  • How development or expansion will be controlled.

“Your operations manual should always include as much detail as possible regarding operational practices that are to be followed,” says Peleva. “A simple list item that states ‘this obligation must be fulfilled’ is not helpful. Looks always to the ‘how’ of the issue and you’ll cover everything you need to.”

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