Plenty of pie to go around

By ELLEN READ

Two Auckland businessmen have set up a small business aiming to get other people into small businesses.

Pie shops to be exact.

Last year Grant Rawlinson and Paul Brosnahan bought the New Zealand master franchise for Jesters the Jaffle Pie Company - an Australian franchise with 34 outlets in Western Australia.

They sold their first licence in August - for a store in Lynnmall shopping centre - and are searching for franchisees to open Jesters stores nationwide.

Rawlinson said franchising was one of the largest growing business sectors in New Zealand and gave people the chance to be in business for themselves while reaping the benefits of being part of a larger brand.

A national survey conducted for the Franchise Association in 2000 found franchising is worth more than $6.4 billion.

It found New Zealand has more than 300 franchise systems in New Zealand - 85 per cent of them home-grown - with almost 5000 operating units and employing almost 35,000 people.

The investment required for a Jesters franchise starts at $230,000 depending on location.

This covers equipping the premises - including all the equipment needed to produce the pies - opening stock, an opening promotional campaign and legal costs.

Stores give 4 per cent of turnover to a corporate marketing fund and pay 6 per cent of gross sales in franchise fees. They must also spend 2 per cent of turnover on local and in-store advertising.

Rawlinson would not say how much stores could expect to turn over or bank as profit.

He acknowledged that franchising was a competitive area with a wide range of business opportunities to choose from, but said Jesters aimed to top the market by offering training, marketing, merchandising and research and product development.

Rawlinson and Brosnahan plan to open a couple of company stores as well, to show their faith in the brand and to provide sites for training.

Franchising may not be for everyone; free spirited types may feel constrained.

There are set procedures - accounting, reporting, advertising, staff hiring and training etc - which must be followed and the business can be sold only to someone who meets Jesters' approval.

But Peter Thompson, who with wife Cheryl operates the Lynnmall store, is a big fan of franchises.

"It puts the checks and balances in place so you don't have to re-invent the wheel for your business," he said.

He's also keen on the simplicity of the business - pastry and fillings are supplied and the staff just have to put them together and cook them, in a modern version of the old-fashioned jaffle iron.

Jaffle iron is the Australian term for the New Zealand quixie iron, a hinged metal compartment with long handles designed to toast sandwiches and pies over an open fire.

Thompson said Jesters franchisees had plenty of opportunities to give their views on new products and procedures.

He also has no problem with the ongoing fees, saying that in any business it is necessary to reinvest money to make progress.

www.jesters-pies.co.nz

www.franchise.org.nz