Presented to: - Dr Omnia Mokhtar

Content

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Q1: - How did Christine Taylor succeed in evolving the local dog washing service
she developed as a teenager into an international franchise business?.............3

Key Success Factors...................................................................................................4

pg. 1
 a) Service innovation (Go to the customer Approach): -....................................4

b) Focused on niche product concept...................................................................4

c) The use of franchise to expand..........................................................................4

d) The flower of service concept............................................................................5

1. Facilitating supplementary service...................................................................5

2. Enhancing supplementary service...................................................................5

Q2: - Compare and contrast the tasks involved in recruiting new customers and
recruiting new franchisees..........................................................................................7

Q3: - From a franchisee’s perspective, what are the key benefits of belonging to
the APM franchise in (a) the first year and (b) the third and subsequent years?9

a) Benefits in the first year:................................................................................9

b) Benefits in the third and subsequent years:.............................................10

Q4: - In planning for future expansion, what strategy should Taylor adopt for APM
and why?.....................................................................................................................11

Q1: - How did Christine Taylor succeed in evolving the local

dog washing service she developed as a teenager into an
international franchise business?
Taylor’s success springs, first, from her strong customer service ethic,
developed as a child from working in her parents’ bait and tackle shop. She
may not have completed high school, but she is clearly intelligent, very
focused, hard-working, and she has a strong motivation to succeed.
She evolves her approach as business grows, modifying both the physical
tools of the trade (the trailer) and deciding from research that expansion would
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be best achieved through franchising rather than through employment of
salaried personnel. In other words, motivated franchisees “rent” APM’s
business expertise and its trailers, leveraged by APM-controlled advertising,
and seek to build business within exclusive territories. Expansion into other
states has been achieved through appointment of franchise sales managers.
Master franchisees also leverage the ability to expand in new locations.
As Taylor soon discovered, there is a market for this service if delivered
professionally and consistently by friendly, competent franchisees who relate
well to both dogs and their owners. Expansion has been at a steady and
manageable rate.
Taylor seems to have avoided the trap of seeking excessively fast growth,
which can lead to loss of control, poor-quality franchisees who fail, and
sometimes cash-flow problems for the parent franchisor. She has maintained
cohesiveness among franchisees in past through the creation of a Franchise
Advisory Council. She has also resisted the temptation to diversify into other
fields, stating “Our niche is in the dog bathing business”.
Taylor has benefited from the exposure of media stories and awards, which
have helped gain recognition and credibility for both herself and the Aussie
Pooch Mobile brand
Key Success Factors
a) Service innovation (Go to the customer Approach): -
The service innovation is the service that the organization provided to its
customers changed, and this brings more value to customers and more profit
to the organization.
Christine discovered there is a market for dog bathing industry. There were
about four million domestic dogs in the country and approximately 42 percent
of the Australian 7.4 million household owned at least one dog. She saw that
dog owner in Australia spent about $1.3 billion on dog-related good and
service which 11 percent to other services, including washing and grooming.
There were a few competitors when Christine started her business. It had a lot
of competitive advantages for her dog wash services than the traditional pet
shop services. The mobile trailer goes to customer’s house can save time for
customers and it also easy to go to another customer’s house. The dog
washing for Aussie is more focus on service qualities than quantities. It means
the services satisfied the customer and exceed customer expectations. The
trailer had a roof and open slide to provide the protection form rain and sun. It
also provided other services free to dog owners, like the skin problems and
health care of the dog. Customers just need to find the information about the
company from online or other medias and make appointment phone call. Then
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 they can wait to have a comfortable shower for their dogs, or Aussie Pooch
Mobile can provide a pickup and return service.
b) Focused on niche product concept
Christine’s local dog washing service has developed since she focused on the
niche product in dog bathing industry. Christine’s dog washing has its
competitive advantages such as mobile trailer that easy to mobilize from one
customer’s home to another customer home, brand image, and social media
promotion that they had done. The first competitive advantage is hard to
imitable since the design of the trailer is made by Christine. It has several
unique characteristics such as open sides and a roof to provide protection
from sun and rain.
Christine has benefited from the exposure of media stories and awards, which
have helped gain recognition and credibility for both herself and the Aussie
Pooch Mobile brand. Even though there were various range of products that
customer demand, Christine still focused on its based core service that is dog
bathing.
c) The use of franchise to expand
The most important part for Christine’s success, it is use franchise to expand.
When she realized that use franchisees were more profitable than hire
employees, the expansion started. The company chose franchisees careful. It
had a minimum educational requirement and had other requirements for
motivate, skills, patience. The expansion kept in a steady and manageable
rate. Aussie seemed that it did not want a fast growth for franchisees, which
might cause fail and bankrupt problems for low level franchisees.
d) The flower of service concept
Christine core service focused on the niche product in dog bathing industry.
Christine’s dog washing has its competitive advantages such as mobile trailer
easy to mobilize from one customer’s home to another customer home.
The core products share two supplementary service elements which are
facilitating supplementary service, required for either service delivery or aid in
the use of the core product, and enhancing supplementary service, which add
extra value for customers.
1. Facilitating supplementary service.
I. Information
 Customer can get the information from the website, brochure and staff.
 Customers can get the price, information about dog washing, and tips to
take care their pooch.
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II. Order Taking
 Customer just call the hotline number of Aussie Pooch Mobile and make
the appointment time with Aussie Pooch Mobile which is mostly once
every 2 or 4 weeks.
III. Payment
 Payment method that being used by the Aussie Pooch Mobile is cash.

2. Enhancing supplementary service.

I. Consultation
 Aussie Pooch Mobile give some free advice by phone call, so that the
dog owner can tell their problem about their dog mainly the tics and skin
problems.
II. Hospitality
 Satisfies users (dogs) as the process of bathing involves a sequence of
carefully coordinated actions starting with saying “Hello” to the dog so
the dog feels comfort and give free advice to the dog owner about dog’s
health care and regular basis to wash the dog.
III. Exceptions
 Aussie Pooch Mobile provides testimonials and comments in its website
so that they succeeded in Handling special communication.
offering special service like aromatherapy bath and blow-drying
animal in order to prevent the animal getting cold.
IV. Safekeeping
 Aussie Pooch Mobile gives a pick-up and return service, Pet Care and
also Cleaning drive away

V. Successful marketing.
The marketing that Aussie Pooch Mobile did is by word-of-mouth and by
marketed in on Yellow Pages as well as for listing in the White Pages. Aussie
pooch mobile seeks to build business within exclusive territories. Expansion
into other states has been achieved through: -
I. Appointment of franchise sales managers.
II. Master franchisees also leverage the ability to expand in new
locations. It’s like the marketing strategy to customer and to the
new franchisees successful.
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 III. Marketing advertising in many Medias, like use Facebook page
and paid for Google AdWords to promote the national website.
IV. A telephone number is used to answering service the whole day
throughout Australia.
V. Once customers left their information in the phone call, the
franchisee nearby would soon provide the service.
VI. With APM’s approval, some franchisees had developed additional
promotional ideas.
VII. Franchisees also provided a Pet Report Card to their clients
accompanied by a retail promotional flyer.

Q2: - Compare and contrast the tasks involved in recruiting new

customers and recruiting new franchisees.
Recruiting new
Tasks Recruiting new customers
franchisees
Market Substantial Limited
Potential
Advertising 1. Helps building primary 1. Encourage entry into the
demand. mobile dog-washing
2. Traditional Medias, like business of independent,
wrote interesting stories self-employed operators
about dog in local 2. Used in many ways to
newspaper, and in digital attract people doing their
Medias, like paid own dog washing
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 Facebook page and business.
Google AdWords to
promote the service.
Identify Dog ownership is
Prospects by visible/audible in suburban
observation: neighborhoods, especially
in nice weather.
Generate leads Advertising, PR stories, and Primarily by advertising and
promotions may attract advertorials plus word-of-
prospects; brightly colored mouth
trailer is like a mobile
billboard and may attract
attention.
Generate 1. Ask existing customers to Undertaking a trial work
referrals pass the word. period with another operator
2. Persuade existing requires significant
customers to change investment of time and
current behavior, one- effort on the part of the
time promotion may help. prospective franchisee.
3. Trial is easy for
customers and takes little
time; benefits are
immediately obvious to
eye, nose, and touch
(running hand through
dog’s coat).
Requirements No requirement for new There are requirements for
customers. new franchisees.
Screening except for extreme cases, Requirements are
customers’ demanding;
skills and personality are candidates must:
not important so long as 1. Be self-motivated and
they can pay and provide outgoing.
hookups. 2. Love dogs and
May have to decline a few understand their role in
difficult/dangerous animals people’s families.
may need to be screened 3. Want to work for
out. themselves.
4. Have completed at least
year ten of high school.
5. Be able to handle the
bookwork.
6. Have people skills.
7. Be patient.
8. Have a good telephone
manager.
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 9. Possess a valid driver’s
license.
10. Have access to a
vehicle capable of towing
a trailer.
11. Be able to do this type
of driving in an urban
setting.
12. (Inferred) Be willing to
work outdoors with only
limited shelter.
13. Be fit enough to
handle physically
demanding work.
14. Be willing and able to
invest $24,000 (plus
$2,400 for the 10 percent
(GST) from own or
borrowed funds.

Q3: - From a franchisee’s perspective, what are the key benefits

of belonging to the APM franchise in (a) the first year and (b)
the third and subsequent years?
a) Benefits in the first year:
1. Proven operational system that:
a) Adds extra benefits to basic dog-washing service.
b) Enables operator to deliver both quality and efficiency
(equals more dogs, better, faster); time savings allows
operator to wash more dogs.
c) Custom-designed trailer rather than requiring operators
to construct their own (which might not work as well).
2. Training and ongoing support as follows:
d) New franchisees receive two weeks pre-opening
training.
e) Representatives spend ten hours to help open new
territories.
f)Franchisees receive detailed operations manual.
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 g) Uniform shirts, caps, and materials for first 100 dogs.
h) Guarantees for minimum income for first ten weeks
and pays six months’ insurance.
i)Monthly newsletter.
j)Telephone hotline for advice.
k) Brief, regular field visits.
l)Additional training.
m) Franchisee meetings and one-day seminars in major
metro areas.
n) Advice from expert franchisees through Franchise
Advisory Council.
o) Providing a temporary replacement operator during
sickness or vacation.
3. Credible, reputable brand and strong marketing support as APM:
a) A recognized and respected brand name creates
confidence.
b) A member of Franchise Council of Australia and
complies with Federal Franchising Code of Conduct.
c) Trailer serves as mobile billboard to promote the brand,
attract recognition.
d) Places ads in local newspapers for twenty weeks plus
human-interest stories.
e) Other promotional activities at launch include
distribution of pamphlets, writing to local pet stores and
vets.
f)Ongoing marketing support includes monthly newsletter,
expert advice, PR.
g) Corporate Web site.
h) Advertising templates.
i)Nearest local franchisee.
4. Strong brand name plus corporate assistance facilitates resale of all or
parts of developed territories.

b) Benefits in the third and subsequent years:

a) APM has created options for experienced franchisees
to exploit their talents within the franchise system.
j)Participate in Franchise Advisory Council.
k) Develop new ideas for APM to disseminate.
l)Volunteer to help new franchisees.
m) Sell a portion of a territory and make capital gain.
n) Purchase a second territory and install an operator.
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 o) Become a master franchisee.

Q4: - In planning for future expansion, what strategy should

Taylor adopt for APM and why?
Franchising offers a way for an entrepreneurial company to expand quickly
without having to invest its own funds. In business format franchising “the
approach most commonly used in service firms “the originating firm licenses
use of its service concept, processes, and branding to independent
businesspeople, who agree to pay an upfront purchase price in order to get
started. Typically, a portion of this charge goes to cover the purchase of
necessary capital equipment, training, and initial promotional efforts. In return,
the franchisee receives access to what he or she hopes is a proven system for
operating a business and delivering services that customers will want to
purchase because they know and trust the franchise brand.
To protect the integrity of this system, the franchisee must also agree to follow
carefully prescribed guidelines and may not subsequently abandon the
franchise and set up a similar business under another name. Additionally, the
franchisee must pay a royalty on all sales and, typically, an advertising levy to
cover the cost of regional or national advertising and promotional support,
designed to build and reinforce brand preference. Franchisees may have the
option of doing their own advertising and promotion, but content and terms
tend to be tightly controlled by the franchisor.
The ideal scenario is one in which the franchisee injects a great deal of
entrepreneurial energy “beyond that expected of a hired manager “yet benefits
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from association with the brand and franchisor support. One franchisor
describes this environment to prospective franchisees as “Going it alone . . .
together.”
Initially, franchisees tend to be heavily dependent on the franchisor. But as
they gain experience and their revenues increase, some franchisors may
come to resent the constraints under which they operate and the royalties they
must pay. This can lead to conflict. Well-managed franchise firms seek to keep
franchisees engaged through such strategies as:
 Continuous improvement in service processes and product features.
 Involvement in franchise advisory councils.
 Facilitating sale of all or part of an existing territory.
 Encouraging successful franchisees to purchase additional territories
and install managers to operate stores in those areas.
 Developing opportunities for master franchising, which allow successful
franchisees to manage large clusters of stores or outlets, delegate day-
to-day operations in the stores to hired managers, and/or to become
responsible for recruiting and supervising franchisees within a large
geographic territory in return for a portion of the latter’s royalties.
One of the biggest challenges in planning expansion franchise strategy lies in
deciding how to balance the lure of moving into distant virgin territories and
making a pre-emptive strike against possible future competition versus
penetrating existing markets more deeply.
Franchises in distant territories are harder and costlier to oversee from the
main office and thus run the risk of deviations from established procedures
and also possible fraud on the part of franchisees themselves. Hence, it may
be necessary to install regional managers or master franchisees, both of which
can cut into profitability.
Competitors for Aussie Pooch Mobile grows very fast, Jim’s Dog wash has 59
franchises while Blue Wheelers has 178 franchises. Their strategy is to create
the smaller territories and lower prices to the new franchisee. The fast growing
competitors lead the Australian market becomes saturated. More franchisees
exist than customers need. When demand is lower than optimum, excess
capacity occurs, the higher the competition, the higher the need for excess
capacity.
So Christine Taylor decided to expand to overseas. Nowadays, Aussie Pooch
Mobile has become an international organization. It expanded to New
Zealand, France, Malaysia, UK and United States during the last 20 years.
The increase of market means the increase of competition. The company did
not do well in some of the overseas market.

pg. 11
It is recommended that the company should keep expand to overseas
markets. Australian market is not big enough for so many competitors.

Christine Taylor needs to make sure the expansion take place in countries for
both she did not operate and she already operated. The company needs to
focus on the richer places and bigger cities in order to make more profit. More
advertising should be put on Medias, and more promotions need to be
planned to attract new customers. The expense for marketing could be
increased, but in long run, this will bring back more profit.

pg. 12