The big real estate brands and their challenges

As part of CENTURY 21 Australia, we work with a large and diverse group of people, a situation not uncommon to most franchise networks. For this reason, I find franchising particularly interesting. People aren’t the only great thing about a franchise network - it’s also widely accepted that franchising has had an unquestionable impact on the economies of many countries, being acclaimed for its contribution to GDP, retail sales, job creation and training. That belief makes me wonder however, if people believe that big brands don’t face the same challenges as small businesses. In some ways I think the challenges are sometimes even bigger.  

Some global networks such as CENTURY 21 have managed to create an incredible level of growth and brand awareness but the perception that some international brands are invincible, even the likes of McDonalds, is misplaced. Like any business, and especially during times of economic uncertainty, franchise groups face changing market conditions and the need for change to remain competitive. In the case of CENTURY 21, our offices are independently owned and operated, so although we are an international brand, your local CENTURY 21 office is actually also a small business.  Regardless of their size, in the current economic conditions, smart companies operating in competitive environments are working very hard to operate more efficiently. This often involves testing high yielding new initiatives and introducing new ways to differentiate themselves from competitors. If you look at McDonalds as an example,  initiatives they have introduced in the not so distant past have included menu changes, operational changes, restaurant layout tests, operating certain support functions offshore and the introduction of new services like wireless Internet access.

McDonald's is also promoting a much greater focus on quality in a further attempt to differentiate itself from others. Interestingly, the increased emphasis on quality monitoring has reputedly led more US franchisees to leave the system in the past twelve months than had exited in the previous five years. CENTURY 21 also prides itself on striving to provide quality service and advice to our customers, but I am happy to say that even in these tough times, our network is continuing to grow. It seems our focus on quality is having the opposite effect to that at McDonald’s and is attracting the type of people who are good enough to uphold the brand.  

Regardless of in which area of business a prospective franchisee is interested, someone considering joining a franchise group needs to assess the company and market they are interested in before setline on an individual franchise opportunity. Like I am proud to say CENTURY 21 does, a franchisor should know its industry, the trends affecting it, and be able to demonstrate a clear vision for how future challenges will be addressed. 

Posted by George Tarbey on 22/02/2010 at 11:20 AM | Categories:

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