Oven cleaning franchisees get return on investment

Rik Hellewell, founder and managing director of oven cleaning franchise Ovenu, explains what the company’s franchisees get for their money

It’s probably fair to assume that nobody likes paying fees of any type, especially when there would seem to be no apparent benefit or logic for doing so. However, in the franchise sector fees are an integral part and important factor in driving business forwards for all concerned. To become part of the highly successful and profitable Ovenu network of over 100 franchisees, there are three fees payable, so we thought it would be helpful to explain what these are and what they cover.

Enviable reputation
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At the start of the business relationship there’s an entry fee, which covers the cost of getting a newly appointed franchisee fully trained and equipped to start a business within an exclusive territory. It also grants the rights for the franchisee to use Ovenu’s registered trade mark name, design registered equipment and products, as well as benefit from the enviable reputation the company has earned, along with its online and offline systems, which it’s built over the last 20 years.

All of the above facets and benefits have been sought, renewed, modified or registered, so simply have to be apportioned and paid for as the business builds in the future. We also have to make a profit like any sensible business. It’s profit that pays for future research and development of our brand. It’s profit that helps to keep our brand at the forefront of our sector and it’s profit that allows us to expand our network.

This could be used for building further relationships with oven manufacturers, possibly more internet development, product enhancements or even all three. The main point is that there has to be ready cash available to fund these developments and that money is only available by the company making a profit.

Then we come to monthly management support fees, which cover the expenses of our head office and support team and also allow the company directors to take a salary from the business, which they have worked hard to build and develop over the years.

Monthly management support fees are, in our case, set at a fixed level every month, which helps enormously with cash flow projections. Many of our franchisees have quickly calculated that the monthly fee, when broken down weekly, is easily recouped by the end of their first job of the week. Others have figured out that just a couple of decent sized jobs will cover it for the entire month. And here’s the best part - those two decent jobs will probably have been generated automatically by the Ovenu brand without the franchisee having to lift a finger.

Economy of scale
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Last, but by no means least, is a monthly contribution to our national marketing fund. This fund was established when our network reached 50 franchisees and is used exclusively for the benefit of the network as a whole. Now well established, the fund is used for ‘economy of scale’ purchasing on media activity such as promotions in national magazines, individual local area websites for every franchisee, Google sponsored adverts and search engine optimisation - all very expensive items in their own rights, but extremely viable when bought collectively.

Do our franchisees get a decent return on their contribution to the national marketing fund? The answer to this is an unequivocal yes. How do we know this? Because we asked them. In a recent survey of our network, 95 per cent of respondents are seeing a 400 per cent return on their investment. And that return is from the internet alone. What about the other five per cent? Maybe not quite as spectacular, but they still get a good return of over 200 per cent.

So there you have it, our list of fees and what they cover. Naturally, there will be some readers who will want to go it alone, but for those who prefer to work within the confines of a tried, tested and highly profitable organisation that has withstood the test of time, appreciate our fee structure and acknowledge the reasoning behind them, we’d love to hear from you.