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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

Make Your Business A Good Neighbour

Take your business from invisible and struggling to a thriving neighbourhood landmark.

Richard Mukheibir

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Is your business invisible to your customers? You may have fewer customers than you would like because your business does not seem relevant to those in your neighbourhood. This is an even bigger mistake than not being able to reach beyond your direct trading area.

To appeal to people – customers – you should also present your business as a group of people who help other people. This can be helping supply them with goods they need to buy, helping provide them with loans or simply being a reassuring and consistent presence in your neighbourhood.

As our Local Area Marketing Manager, Juan Botha, tells Cash Converters’ franchisees, this is about blending and fitting in like a neighbour. It is about give and take. And all of that adds up to community engagement.

Related: Effective Ways To Bring Customers To Your Door

Here are six of his top tips:

  1. Introduce the family: Cultivate a friendly, welcoming atmosphere in your shop or office. Introduce new staff to regular customers. Make sure that new customers can get to know staff through your in-store welcome boards and name badges.
  2. Find your partners: Identify the gatekeepers in your community and create partnerships with them. Think about approaching sports clubs, schools, church groups, sewing circles and book clubs.
  3. Snatch some selfies: If you have local celebrities as customers, take a selfie and post it on your social media: “Guess who came to say hello today . . .” Build relationships with local heroes and you will be able to call on them to host your in-house fun day or charity drive.
  4. Give back to business: Be involved in local business chambers and groupings as more than a participant. Show you are a good business neighbour by facilitating speed networking, hosting a speaker or sponsoring a sound system or catering for the next meeting.
  5. Adopt a cause: Identify a local charity and rally support for it.
  6. Help the community: Launch or participate in a community project – anything from an area clean-up or helping repaint school classrooms to planting trees or a community vegetable garden.

Building relationships helps you build your business’s reputation. That is because you can make people start to feel a certain way about your business and influence them positively towards you. Then, when they need something that you supply, you will be top of mind.

That neighbourhood warmth creates a sense of ownership. These prospective customers will already know how you can benefit their lives and so are more likely to become your regular customers.

They will be acting on the fact that people remember you for the experience you give them. As top American writer Maya Angelou said, their memories will be shaped by how you make them feel – not how or what you make them think. Relationships may be intangible but they can bring real value to your business.

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Franchisors

Why Your Franchise Should Adopt A Shared Value Business Model

Stay ahead of the curve in an evolving business environment and unlock business growth by addressing social issues.

Diana Albertyn

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Have you heard the term ‘profit with purpose’ in your business ownership circles, but not sure how exactly it could be applied to your franchise? As a franchisor, entrenching this model into your core business strategy could see your current growth potential multiply – along with the communities that play a role in your business’ success.

“By leveraging resources, market access, scale and their capacity for innovation, businesses can advance and accelerate development while generating commercial returns.”– Serial entrepreneur Cindy Langeveld.

Considered the key to profit and progress, the shared value business model enables your franchise to go beyond just ticking the CSR box. Here’s why and how your franchise can start establishing partnerships for business growth:

Indicates your business has a conscience

Not only is a profit-first business approach is no longer viable for long-term business growth, the role of the consumer is becoming more prominent – and they are leaning towards buying from corporations that demonstrate conscientious business practices. Donating blankets to a charity is good, but how are you impacting those involved in the value chain that sustains your business?

Related: 3 Crucial Considerations For New Multi-unit Franchisees

Chicken franchise chain Nando’s, for example, creates shared value for the key players in the success of their brand – the small farmers in Southern Africa who farm their unique African Bird’s Eye Chillies used in the PERi-PERi flavour.

This farming initiative was started ten years ago in Mozambique with just six small farms. Today it includes 1400 farmers and produces in excess of 360 tonnes of chilli across Southern Africa.

Ensures your profit creates progress

nandos-peri-peri-farming-initiativeWhile implementing shared value business models helps consumers see your business in a better light, it’s important for the initiatives that stem from it have a visible, positive and measurable impact on the communities concerned.

“I’ll never forget my first impact assessment. I sat with one of our farmers and a translator who told me about the impact growing chilli crops for Nando’s was having on his life and his community” recalls Sam Hirst, Nando’s PERi-PERi Farming Initiative Manager.

Nando’s has grown and sustained its network of farmers through learning and improving on the process, despite the challenges involved. Empowering the small farmer has required unprecedented effort and working very closely with farmers every day and every step of the way to overcome challenges such as generating working capital to set up the infrastructure the farmers needed, managing unpredictable weather conditions, and high transactional costs.

Related: Why Your Franchise Brand Should Be Culturally Relevant

Creates sustainable partnerships

The purpose of implementing a shared value business model is so make a sustainable difference in both your business’ growth and that of the communities involved in your supply chain. For Nando’s the motivation was the potential impact the chilli farming could have in its communities.

The franchise has consequently invested in providing these farmers with the tools and skills for sustainable farming. Investing in technologies and various new processes has enabled Nando’s to secure prices and contracts directly with the farmers, avoiding potential negative economic impact on the farmers’ financial security.

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Franchisors

3 Employment Best Practices To Apply In Your Franchise

Brand new to franchising? As a first-time franchisee, you may need some guidance on managing your recruitment processes within your business.

Diana Albertyn

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You’ve just hired your first few employees. Congratulations. As an owner-operator who is also new to business ownership, navigating the human resources aspect of your franchise may be daunting, especially when growth is imminent. Your franchisor offers support, but may not want to play a huge role in recruiting and managing your staff.

“Employee management and HR compliance is a tricky topic, especially with the relationship between franchisors and franchisees. Depending on what HR support the franchisor can and cannot provide, the franchisee may be on their own in this all-important area.” – Dean Haller, President and founder of HRSentry

This, however, doesn’t mean you’ll have to blindly search your way through human resources practices, hoping you’ll eventually get it right. Invest a little time into learning the basics, and you’ll make the best decisions until you can afford to hire an HR specialist – and pick up some expertise along the way.

1. Equip newcomers with the tools for success

Consider the type of information, tools and training your new recruits may need to function productively in their new work environment – and ensure they get it. “Studies indicate that most new employees decide whether to stay or leave a company within the first six months, so be sure to be welcoming early on to help them feel part of your team,” advises Haller.

Related: Why Your Franchise Brand Should Be Culturally Relevant

“If you’re thoughtful of your employees’ new experience, they will become more productive and engaged, and thus, more likely to stay.”

Remember the first time you went through the manuals while familiarising yourself with the franchise concept? A new employees’ experience is similar as they have to take in a lot of new information while acquainting themselves with their new workspace, colleagues and systems. Make the on-boarding easier, by reasonably introducing each aspect during orientation and training.

2. Remain stern on performance standards

Once both parties are satisfied with the training and support offered, new staff should be made aware of expectations and receive continuous and constructive feedback on their performance based on these.

Should employees fail to meet their KPIs, it’s important you’re able to identify if your best efforts have failed and whether termination is an option. “Don’t procrastinate. Make sure all performance-related reasons are documented clearly,” says Haller. “Treat the person with dignity and respect –not only because it’s the right thing to do, but because it’s good business practice and can help you avoid any potential legal action against your business in the future.”

You can avoid this situation early on by hiring employees whose CVs not only meet your business’ operational needs, your company culture too.

Related: As Consumers’ Tastes Change Can Your Franchise Keep Up?

3. Acknowledge and reward hard work

During key periods of business growth, it’s easy to overlook good performance. And even when you acknowledge your best employees, sometimes money in the bank isn’t as meaningful as creative tokens of appreciation.

“Get creative,” says Haller. “Provide flexible work schedules, interesting assignments, or a gift certificate to a great restaurant or spa. Be mindful that it’s costly to replace a good employee, so reward your employees with some kind of benefits if you can,” he adds.

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