Published In:
Franchising and Own Your Own Business Date Published:
1st May 2003 Author:
Ros O'Sullivan
Our four featured franchises are examples of the many enterprising systems that have found a niche providing support to Australian businesses and individuals. With over half a million small businesses operating in Australia, the services they offer - ranging from debt collection and cost reduction to courier delivery and packaging - have a vast potential market. They're on the hunt for franchisees. Do you fit the bill?
Expense Reduction Analysts
Basic Background to Franchise Development and Brand/Company Presence in Australia
Expense Reduction Analysts (ERA) specialises specifically in cost management, helping companies to review overheads like telecommunications, couriers, printing and waste management to keep costs down and profits up. ERA prides itself on being 'resultants', not just consultants, as itnot only provides cost reduction recommendations but implements them. Its systems are so effective that it offers a
'no savings-no fee' guarantee. Best of all the company using ERA's services keeps 50% of the savings! Expense Reduction Analysts was established in the US in 1983 and in Australia in 1993. A limited number of opportunities to become an ERA associate are available in New South Wales, Western Australia and Victoria.
Qualifications and Background of Ideal Franchisee
First and foremost we are looking for people who want to be part of a fast growing business. We want people who are passionate about what they do, have drive and are lateral thinkers who enjoy hard work and thrive on challenges. Many of our most successful Associates come from backgrounds as diverse as sales, general and senior management, consulting and small business. On the whole, we look for Associates who have a management background in finance, sales or marketing, as well as management consultants who are experts in areas such as print, telecommunications, waste management, document storage, finance/leasing and insurance. Candidates need to enjoy high level consultative selling and business development, be true professionals who are comfortable dealing with people in all positions from executive to administrative. They should not be looking to buy themselves a job so much as grow a highly profitable business. We also have a management licence structure opportunity for partnerships or like-minded professionals who want to develop their own consultancy business using ERA’s business tools and systems.
Entry Costs and Ongoing Costs
The Licence Fee is $45,000. In addition ERA provide a comprehensive training, coaching and new business generation service at a cost of $29,500. This includes ERA’s proprietary Management Information Software and ERADXAX a comprehensive tender software tool for larger corporations. A royalty fee of 15% of Associate revenue applies. This covers marketing, promotions and ongoing business development expenses as well as the active support of ERA management.
Training Provided
Every Associate receives comprehensive training in the ERA proven business system and this is how ERA has achieved its market-leading edge. The initial training program package provides the Associate with the most advanced business strategies, techniques and tactics available - everything they need to know about running a successful cost management consultancy. From effective sales and business marketing to negotiating with suppliers and benchmarking prices through to measuring consultants' performance and to using ERA’s proprietary state-of-the-art tendering software. Training is supported by substantial ERA resources to ensure that the Associate is ready and able to achieve success with the ERA proven business system. This includes a sales and operations coach for their first six months of operation. Coaching is tailored to suit the Associate’s level of experience and whether they have chosen to remain a generic cost management consultant or specialise in a particular cost category. The role of the coach is not as trainer but rather to help direct the new Associate through the ERA system of auditing and in turn to provide benchmarks to measure and monitor progress. Brisbane ERA Associate Mark Smith comments, "Overall I rate the ERA Induction Training Course very highly. It's an excellent example of contemporary professional training...I found the course very motivating."
Marketing Support
Initially we arrange 10 appointments on behalf of the new Associate at CFO or Managing Director level. These are with companies in ERA’s target market who typically have a turnover of $10million or above. The coach attends at least five of these appointments to act as a guide if needed. This service can be continued past the initial six month coaching period. ERA has found that one of the most effective marketing tools has been word of mouth. The guarantee of ‘no savings
'no fee' immediately provides clients with an opportunity for a no risk assessment which provides Associates with an effective ‘foot in the
door' if not for themselves then for a fellow Associate who specialises in a particular cost category. Working as a team and utilising each other’s resources is an extremely important part of ERA’s culture. Further sales tools are in the ERA marketing brochure, regular newsletters and on the website which is updated monthly.
Field Representation Provided by the Franchisor
Over and above ERA’s training and coaching programs described above, there are monthly associate meetings in each state where suppliers are discussed and case studies and market reviews are addressed. On these occasions, an Associate will present information on a specialist category. There is also an annual conference which is attended by both local and international licensees. Topics of discussion include international global trends in supply, cost management and business building techniques as well as new products and market opportunities. On an on-going basis ERA uses the Management Information System (MIS) covers current marketplace news and business operating tools and provides regular communication through both local and international bulletin boards.
The Scope of the Agreement
The term for the national licence agreement is a fixed period of 10 years with an option to renew for a further five years at no additional charge.
Opportunities for Expansion
ERA’s objective is to assist Associates to build recurrent income streams so that they can increase the value of their business. There are several ways in which they can do this and one is to develop their core skills. These include key procurement, government and contract management. Another is suitable for partnerships, or like-minded professionals who want to develop their own organisation or division within an existing company, through the application of an ERA Management Licence.
What is the Corporate Vision?
To remain the world’s leading specialist in cost reduction management. We stake our reputation on our success by offering a ‘no savings-
no fee' guarantee.
What makes ERA a Preferred Choice in this Franchise Category?
ERA is the internationally recognised global market leader in the cost management field with proven business systems and a unique ‘no savings-no
fee' service guarantee. As a result the company has a blue chip client base with the potential to constantly expand due to the potential to review further cost categories and through referred business.
Key benefits for Associate include high income potential with an excellent return on investment - an ERA business is a low overhead high margin business irrelevant of the financial climate and Associates earn 50% of the savings they achieve for a client over a
24 month contract. On-going revenue at the expiry of the initial contract is achieved through monitoring total client costs and placing them under an ERA management contract, renewable annually. Other benefits are that the Associates are supported by appropriate software, comprehensive training and sales and operations coaching.
