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Introducing Franchise NewsBlast

clock June 23, 2008 09:55 by author JKealey

We've just added a new item on our press release page. The content of this press release is replicated here for your convenience.

Montreal, Quebec, June 23rd 2008 - LavaBlast Software launches Franchise NewsBlast (http://news.lavablast.com), a free online system which provides franchise news to franchisors, franchisees, franchise service providers, and franchise wannabes. The system allows visitors to keep up with what's new in franchising by collaboratively selecting the best franchise news. Visitors are invited to submit articles related to franchising which they feel would interest the other members of this online community.

Franchise NewsBlast covers a wide range of subjects related to franchising such as legal issues, franchise technology, new franchise opportunities, franchise trends, and even franchise humor. Anyone can become an editor because Franchise NewsBlast allows its members to blast interesting franchise news items, allowing the best articles to rise to the top. Because of a collaborative community effort, people interested in franchising can quickly keep up to speed with franchise news without having to visit the hundreds of franchise blogs available on the Internet.

Motivating Factors

There are a few motivating factors behind the launch of this new franchise community, which benefits a wide range of people.

For readers: Save time!

In the franchise industry, readers typically do not have the time to visit, on a daily basis, the hundreds of franchise-related websites which are available on the Internet. Readers are interested in receiving quality franchise news but simply don't have the time to filter through the large volume of articles published every day. Franchise NewsBlast solves this problem by aggregating news from various sources and publishing the cream of the crop. Readers can also share opinions on external articles directly on Franchise NewsBlast, allowing them to connect with others in the franchise community.

For bloggers: A niche-specific aggregator, maintained by the community.

An important part of blogging is informing the community about your blog and getting your articles to interested readers who might not have found your blog. Franchise NewsBlast is similar to the very popular Digg except that it focuses exclusively on the franchise niche. On Digg, it is impossible to get an article reviewed by enough people with interest in the franchising industry given the general nature of the community. Quality franchise-related articles typically fall through the cracks of such mass-population sites whereas they can become very popular on niche-specific sites. Additionally, bloggers can leverage their existing visitor base by adding a "Blast It" icon on each of their franchise-related posts, increasing each article's popularity on Franchise NewsBlast.

For franchisors: An incentive to start blogging!

It is not easy (or cheap) for a small franchisor to get their name out in the franchise community. Hundreds of new franchise systems are born every year and Franchise NewsBlast is one of the ways these new franchisors can join the online franchise community. As approximately 25% of all franchise systems have less than 10 locations, small franchisors are a big part of the franchise community and they deserve to be heard. After starting their own blog to share lessons learned, current market trends, or elements which different their franchise, franchisors can use Franchise NewsBlast to drive traffic to their blog and get feedback on their system from various franchise professionals or simply attract new franchise prospects.

A collaborative effort

A large number of franchise websites are created with the intention to promote the highest-bidding set of franchise brands whereas Franchise NewsBlast is intended to inform people, not to showcase franchise opportunities. Thanks to collaboration between peers, Franchise NewsBlast intends to complement existing franchise communities such as Blue Mau Mau. LavaBlast adapted the open source software which powers DotNetKicks, a news site dedicated to .NET software, to focus on the franchise niche and allow anyone to become an editor.  Readers are encouraged to start posting news on Franchise NewsBlast immediately and inform other people in the franchise industry of its existence. 

 

For more information, please visit Franchise NewsBlast at http://news.lavablast.com.

About LavaBlast Software Inc.

LavaBlast Software Inc. has developed FranchiseBlast, a web-based software solution for the franchise industry that simplifies day-to-day franchise operations by integrating the franchisee's point of sale and the franchise's e-commerce site with the franchise intranet. The integration of existing software is a proven way to leverage the franchise's original software investment during an economic downturn.

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Franchises Can Learn From Software Startups - Part 2: Trends

clock June 23, 2008 09:18 by author JKealey

This article is the second of a three-part series related to technology in the franchise world. It discusses current trends in both the software and franchise worlds which are relevant, given the similarities illustrated in Part 1. Part 3 discusses what franchisors should be doing to react to this change in business context.

Fact: The world is changing. Technology is the catalyst.

Wicked technology The impact of technology on the way we do business is undeniable, and franchising is no exception. More often than not, franchise success stories list technology as one of the key elements to the franchise's growth. Five to ten years ago, most franchise systems recognized the value of a franchise intranet/extranet as a centralized franchise collaboration tool. More recently, the rise in franchise systems which allow absentee/semi-absentee franchisees has increased the need for software tooling that facilitates remote franchise management

Start thinking about who will be buying franchises in the next decade or two. These people have grown up with the Internet and do not know life without it. A very insightful read on this subject is Diana G. Oblinger's recent publication Growing up with Google: What it means to education as many of the concepts can be projected from current day challenges in education to tomorrow's franchise sales situation. The Net Generation (born after 1982) is now entering the workforce with university degrees. It won't take long for them to look at purchasing a franchise. Thanks to the Internet, the Net Generation has access to vast amounts of information which doesn't always work in the franchisor's favor. A single individual can report scams which rapidly make their way through the Internet. There are even blogs dedicated to reporting fraudulent business opportunities. This generation has learned to question authority and to go the Internet to prove their claims.

The widespread availability of high-speed Internet has not only impacted franchise operations: it has deeply changed our society. The latest trends in software have been user-empowerment (blogs), online collaboration (wikis), and social networking (for business or for fun). In case you didn't know, over a quarter of all Canadians have a Facebook account. If you're thinking that this is a fad for kids and teens, think again as over half of these users are over 30. Reacting today to these social and technological changes does not only help prepare yourself for the future, it also helps you understand your current operating environment because the facts of life for the Net Generation are also true for many older individuals which are no longer marginal.

A few trends in the software world...

Starting a software company on a shoestring has never been easier for a number of reasons. First, high quality open source tools, powerful software frameworks, and the availability of free web services allows competent software engineers to solve problems faster than ever. Second, infrastructure costs are negligible. Everyone already has a computer and an Internet connection... and working from home is an option for MicroISVs. Once you outgrow your basement or garage, co-working environments provide an affordable way to grow your company to the next level.  Even if you operate from home, you can still reach a very wide potential client-base thanks to the Internet and the same logic applies to any kind of business, not only software.

Another trend in the software world is that many cities (examples: Ottawa, Montreal) offer a vibrant software startup community which most people aren't even aware of. Founders are connecting and publicly sharing lessons learned. Funders are even connecting with founders at informal social events focused on growing the community. Twenty years ago, it would have been hard not only to meet startup founders but also to sit them down to hear about their experiences. Today, you can read about it on blogs and join up at local events... and if you're feeling old school, you can still buy books to learn the stories of other founders. As we all know, the Internet makes it easy to contact other people and collaborate online but it does also make it easier for people to meet offline for both business and social events. 

Finding and retaining good people is the single hardest task in a software company, even if you've got money to burn. Money is an incentive, but is far from being the most significant one for software engineers. Indeed, just take a look at Maslow's hierarchy of needs to discover esteem and self-actualization are higher in the pyramid yet cannot be purchased with money. What developers are looking for are interesting challenges in a great work environment and most large organizations are unable to take advantage of this fact, which push the best software engineers to work at smaller startups or even start their own company. The best talent have plenty of opportunities to pursue and consequently don't often look for jobs on sites such as Monster whereas bad employees always end up unemployed and pollute the system. The solution in the software world is to be active in the software community and utilize niche-specific job sites such as the Joel On Software job board.

... That are also present in the franchise world

Which one would you pick?In the franchise world where we are seeing lots of concepts, such as home-based franchises, growing rapidly because of their low start-up costs. Many people dream of being their own boss while doing something they love and it now easier than ever for them to start their own business. Striking gold is (and always will be) hard, but one can make a decent living with a MicroISV (thanks to niche markets on the Internet) or home-based franchises (thanks to franchisors who know what it takes to make the concept work). We're also seeing an increasing number of new franchise concepts, partially because the Internet has made it easier to contact experts in franchising (and vice-versa... which is not always a good thing).

I would love to say there is a vibrant startup franchise community on the Internet, but that is simply not the case. There are a few disparate local associations but the web is polluted with franchise opportunity websites, given the high commissions related to franchise sales. However, if you look hard enough, you can find a few good websites which unite franchisees and franchisors under one roof for discussion and collaboration. Furthermore, younger franchisors are turning to blogs and are openly discussion various lessons learned. It would be superficial and discriminatory to claim age is the only factor at play to explain the slower growth of a good online franchise communities, but it is a contributing factor given the fact that franchisors require a substantial amount of capital to launch a franchise. Few, if any, current franchisors are part of the Net Generation.  However, I am optimistic that a number of excellent franchise-related websites such as Blue Mau Mau, focusing on everything other than sales, will help grow the franchise startup community over the next decade thanks to collaboration between franchisors and various franchise service providers.

Finding and retaining good franchisees is an obvious challenge in the franchise industry. Many new franchise prospects are surprised that they are being screened for quality and are unaware that, for new/small franchisors, their individual success can have a strong impact on the success or failure of the whole system. Most franchisors complain about the decreasing quality of leads via franchise websites and this poor quality is surprising given the parallel which can be made with online recruiting systems such as Monster. As more people look for franchise opportunities on the Internet,  it becomes increasingly important for franchisors to be able to efficiently filter through a larger volume of requests but also for them to be proactive about sales and marketing. This can be achieved by participating in online communities dedicated to their niche. Of course, time & effort is a valuable commodity and lower quality leads are to be expected when a franchisor doesn't proactively work on solutions on a daily basis. 

Summary

After discussing changes in our society, this article covered three core trends:

  • Younger people are starting businesses on a shoestring budget.
  • It is easier than ever to connect with other people and learn from their mistakes.
  • The big sites are saturated with people you don't want to hire or have as franchisees. 

Part 3 will talk about what you should be doing to make the best of this changing environment. Your homework for the next week is to participate in a few online communities of your choice (Franchise, Startup, or Local). Also, take a look at Franchise NewsBlast, which we are launching today.


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Franchises Can Learn From Software Startups - Part 1: Similarities

clock June 17, 2008 11:57 by author JKealey

The omnipresence of technology in our lives and the Internet has changed the way we do business. The software industry is not only one of the driving factors for this change, it is also one of the first industries to be influenced and react to changes in society. This contrasts with the franchise industry which is a bit old school... which has its pros & cons. Regardless, being abreast of current trends is helpful for any business and we feel franchisors can benefit from the insights of those with a software engineering background. Since LavaBlast builds software for the franchise industry, we’re at the junction point of two very different worlds ... which are more alike than you would initially expect. 

This article is the first of a three-part series related to technology in the franchise world. It focuses on similarities between franchises and software startups and serves as a premise to Part 2, which covers current trends in both industries. A comparable evolution in a changing context was to be expected, given the similarity between software startups and franchise systems. Finally, Part 3 discusses what franchisors should be doing to react to this change in business context.

For the sake of argument, let’s focus on small and/or new franchise systems. Why? There are numerous reasons:

  1. Innovation often comes from smaller, nimbler organizations.
  2. Over half of all franchise systems have less than 50 units. 25% have less than 10 franchise units
  3. Hundreds of new franchise concepts are born every year. Over 1000 businesses turned to franchising for expansion between 2004 and 2006.

Small franchises are similar to software startups in nature.

Building the next great thing There are numerous similarities between software startups and budding franchises: the strong need for domain expertise, the global potential, and they are both created to fill a gap in the market. However, their resemblance can be concisely be explained by looking at growth patterns and scalability.

In general, because of the very nature of software, software startups can achieve very high growth in a short period of time (examples abound!). Venture capitalists rate startups according to their scalability in order to obtain the highest possible return on their investment. This is done by building software which solves problems for a large group of people with little or no custom work required on the software firm's end to support a new user. Hosted software applications are installed once on the startup's web server and shared between customers, thanks to a scalable multi-tenant software architecture.  Additionally, the first hires in a software startup are crucial to building both v1.0 of the product and also the company’s culture. A solid team working together in the same direction is necessary to grow a successful company.

Franchises are similar because the concept must typically be tested and proven to be successful in its first location, akin to a software beta. Small business owners which turn to franchising as a growth strategy quickly discover than growing a franchise is a completely different ball game than making your first location successful. Scalability cannot be tacked on, it must be planned. The franchisor must find a scalable supply chain and must ensure the store look & feel is replicable. Unfortunately for some, purchasing store fixtures at your local flea market, police auction, or more recently eBay is not a replicable way to grow a franchise. The franchisor can't fly out to different cities to shop around for cool lamp shades for each new franchisee... Suppliers must be approved and utilized. The same is true for software where an integrated solution is the key to simplified franchise management. Furthermore, people with different backgrounds and skill sets are required to launch a successful franchise, and the first few franchisees are critical. As much thought (if not more) must be given when picking the first franchisees as the first hires in a software startup.

Additionally, the very nature of franchise systems implies that franchisees are geographically distributed. One might think this is not the case in software startups, but this is not totally true due to outsourcing and open source. Furthermore, even small software startups deal with international customers on a daily basis.  As such, the various stakeholders are not necessarily always in the same room ready to discuss business issues even though both are have to quickly react to preserve customer/franchisee satisfaction and grow the business.

Implications

We've just scratched the surface of why software startups are similar to small franchise systems. You may have other similarities in mind or you may disagree and have opposite feelings; in both cases, you are invited to share your opinion.

If you are a franchisor, why should you care about software startups? Simply put, software startups are more in tune with the impact of technology on our society which affects your franchise's operating environment. This subject will be covered in detail next week, in Part 2. In the meantime, you are invited to read Growing up with Google: What it means to education which explains the characteristics of the Net Generation you should be aware of, regardless of your background.

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Disclaimer

The opinions expressed herein are my own personal opinions and do not represent my employer's view in anyway.

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