How are Franchisees Dealing?

We spoke with several franchisees to see how they're overcoming obstacles.

SHARE

My Solution:


"We created loyalty cards and did a mass mailing to our local 10-mile area. We've done a lot of other direct mailing because it's measurable. We also very carefully analyzed where we're spending money [as well as] on what areas we can afford to not necessarily cut but control. One area was our linen costs--the towels and things we use to clean. We actually made that a focus for the managers, and we started saving [about] $500 a month. We looked at energy--when we turn our equipment on and how long it runs--and our staffing, which is one of the biggest [costs]. We also started opening for lunch on Sundays."

Franchisees: Wendy and todd Diskin, 34 and 37, respectively

Franchise: EmbroidMe, a company that specializes in promotional solutions for businesses, including decorated apparel and screen printing


Purchased Franchise in: 2004
Location: Lenexa, Kansas
2008 Sales: More than $700,000 Our Challenge:


Rising costs
"Throughout the past year, we [have received], on a routine basis, notices from our suppliers that costs are going to go up. [The cost of] getting products from overseas [to] customs to warehouses has gone up. It's almost a 5 percent increase in the cost of goods over last year." Our Solution:


"Because we're in the custom product industry, where competitive pricing is always important, we have to be competitive. But what we have been trying to do so it's not just a quote basis is provide more of a solution-based framework for our business. For example, if customers are trying to increase their readership, we think about how we can use our products or services to help them do that and then come up with a complete program. It's then about risk and reward and ROI instead of price, and that's how we've been trying to present ourselves to our customers. We also purchased a continuous marketing software program that sends letters and e-mails so we can stay in front of our customers on a regular basis without a ton of effort on our part. "Being part of a franchise has helped us out because vendor relations is one aspect of the business we don't have to worry about as much as we would if we were on our own. [Corporate] is out there building strategic relationships with different suppliers and negotiating to get us the best prices we possibly can."

—By Sara Wilson.

Copyright © 2008 Entrepreneur.com, Inc. All rights reserved.


TAGS:
entrepreneurship
recession
franchising