Tuesday, November 13, 2007

News: Mention on BOPreneur

Paul Hudnut at BOPreneur mentioned microfranchising in a recent post reporting from the TechAwards 2007. The rest of his observations are interesting as well.

4) Microfranchising is now in vogue. Interestingly, while there was a lot of buzz about it, no one seemed to credit BYU and its work at the Center for Economic Self Reliance. Even though they wrote the book on it. This is an area worth watching. People have talked about franchising to achieve scale in the past. Adding "micro" doesn't change the fact that you need a pretty high operating margin to make room for all the people in the chain. If I were going to look at this seriously, I'd also be looking at models like Great Harvest Bread Co., which has a one page franchise agreement. At Envirofit, for instance, it would be great to open up franchises, and we have discussed it. But that may mean higher prices for the retrofits. It may still be the best way to achieve broad distribution, since a great thing about franchising is reducing your asset footprint/expense per unit.

It's excited to hear that there is "a lot of buzz" about microfranchising up in San Jose. In one of these upcoming posts I'll report on the experience of some practitioners on the 'making room for all in the value chain' challenge based on presentations at the ESR Conference last weekend.

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