Many IFA members have expressed interest in social franchising, the application of the franchise model towards humanitarian ends. IFA's 2018 Convention offers a number of opportunities to learn about social franchising and begin to engage.
1. IFA Franchising in the Social Sector Task Force Meeting
10 am to Noon, Saturday, February 10th
Phoenix Convention Center Room North 227-B-C
2. How Social Franchises Are Addressing Complex Problems in the Developing World
8:30 to 10 am, Sunday, February 11th
Phoenix Convention Center Room North 123
This interactive panel and audience discussion will examine commercial franchise approaches to complex issues in the developing world. The issues faced by Ohio State University's Global Water Institute in reestablishing well water, local delivery and seasonality issues in Tanzania are unique and difficult. Franchising instead of a classic NGO model was chosen because of the promise of consistent quality and sustainability. The structure of the Global Water Institute (GWI) franchise offering and approach will be examined. In this session, the audience, based on their experience in commercial franchising will be challenged to look at the issues GWI is facing and recommend changes to their adopted strategy.
Moderator: Michael Seid, CFE, Managing Partner, MSA Worldwide
Speaker: Marty Kress, Executive Director, Global Water Institute, The Ohio State University
Speaker: Mark Vanase, Director, Field Operations, ServiceMaster Restore
3. Business Solutions Roundtable- Social Franchising: Serving the Base of the Pyramid
8:00 to 9:45 am, Tuesday, February 13th
Phoenix Convention Center, Room West 301 B-D
Facilitators: Michael Seid, CFE, CFW Shops & Ferenz Feher, Feher & Feher
Check out your personal agenda and register today at https://www.franchise.org/convention.
Visit the IFA Social Sector Task Force's site to learn more: http://www.socialsectorfranchising.org/about.html
What is social franchising?
Commercial franchising and social franchising are variations on the same basic strategy for expanding a business. They differ in just two ways:
» The type and purpose of the products and services offered by the business being franchised
» The profile of the target customer
Social franchised businesses, like those operated by traditional NGOs (nongovernmental organizations) are primarily developed to offer products and services that people need - not simply want - such as healthcare, safe drinking water, sanitation, clean energy, and education. These are social enterprises whose creation is targeted to achieve goals such as those set in the 2030 Sustainable Development Goals established by the United Nations (https://sustainabledevelopment.un.org/sdgs).
With the exception of the different profile of the targeted consumer, social sector franchises and commercial franchises are quite similar. In contrast to the customer who walks into a McDonald's or a Marriott, the consumer targeted by social franchise systems often can't afford to pay the entire cost of the goods and services they need. Because of that, social franchisors are usually unable to generate the royalty and other revenue and fees necessary to independently sustain the overall business.
Being independently sustainable is the hallmark of commercial franchising. That is the significant difference between social and commercial franchisors.
IFA Social Sector Task Force Chair Addresses Students at Ohio State University: The 411 on Social Franchising – External Advisory Board Member Speaks With Fisher MBA Students
Recently, a member of our external advisory board, Michael Seid, international franchising consultant, came to speak to a group of Fisher MBA students on campus. Well over 40 students attended the lecture, on a topic of great interest in the business world: franchising. Franchising is defined as licensing the right to use a firm’s business model and brand for a prescribed period of time, and Seid is definitely an expert in the practice. The co-author of Franchising For Dummies (co-written with the late Dave Thomas, founder of Wendy’s), as well as co-author of a book released this year, Franchise Management for Dummies, he has spent much of his life working in the world of franchising as a consultant.
At Fisher, Seid shared his insight and expertise on various aspects of franchising, but one topic that many of the students that attended the session enjoyed very much was social franchising. Social franchising takes a new spin on the model you might recognize from the fast-food world. The difference is that instead of businesses providing just consumer products or services, social franchise systems provide public-oriented services like health care or water in an entrepreneurship/non-profit hybrid model that can be replicated just like a restaurant chain.
In particular, Seid discussed a group of birthing centers that he and his partners have helped to launch in Ghana. The centers use a hub-and-spoke model where locally deployed clinics are owned and operated by nurses or midwives, and focus on prenatal care, but a master franchiser operates centrally-located hub clinics to which mothers can travel to give birth or if they need more advanced care. The master franchiser also provides business support and assures strict adherence to brand standards, delivering a high-quality and standardized experience to expectant mothers. While this network of birthing centers is new and results aren’t yet in, if the social franchising model Seid and his colleagues have used for medical clinics in Kenya and Rwanda are any indication, the result will be better quality service with lower fees than government-operated centers.
“I’ve always had an interest in applying a business model into expanding free health clinics, so I found this information very useful,” said one MBA student who attended the talk. “It’s amazing how so many different people can seamlessly adapt a business model for the overall growth of the organization.”
GWI’s External Advisory Board members Michael Seid and Tom Blackstock (a former Coca Cola executive) have collaborated with Fisher faculty member Keely Croxtonand others on the GWI team (including several cohorts of Fisher MBA students) to develop a social franchising model for water services in rural parts of developing countries. The model aims to use market mechanisms to help villages keep newly established or rehabilitated water systems working for the long-term, something that has been a failure point for many water philanthropy projects in the past. A version of the model will be rolled out in two villages in Tanzania partnering with GWI to launch pilot Sustainable Village Water Systems this fall.
Building the Ecosystem of Social Sector Franchising: What Can We Learn from the Evolution of Microfinance?
Presented by Bill Maddocks, MSCED, Carsey School of Public Policy, University of New Hampshire
Access the webinar here: https://www.franchise.org/file/sstf-bill-maddocks-nov-28-17mp4
IFA Social Sector Task Force webinar presented by Dr. Fiona Wilson, University of New Hampshire
Access the webinar here:
The University of New Hampshire is delighted to invite you to the Third Annual Social Sector Franchise Innovations Roundtable (SSFIR). SSFIR is a unique invitation-only conference convening a diverse
cross-section of social sector franchise entrepreneurs, commercial franchise experts,
impact investors and donors, thought leaders, and scholars.
When: October 18-19, 2017
Where: University of New Hampshire | Durham, NH, USA
Our theme this year is “Moving from Pilots to Proven Concept: Tools, Metrics and Best
Practices for Social Sector Franchising.” The two-day roundtable will include:
Greg Hills, Managing Director FSG
Mr. Hills has over 20 years of experience advising organizations on strategy, program
design, evaluation, and operational improvement, and co-leads FSG’s global corporate
consulting practice advising multinational corporations on innovative shared value and
CSR strategies. He has published numerous influential papers and speaks regularly on
topics of shared value, CSR, collective impact, and philanthropic effectiveness. FSG is a
mission-driven consulting firm for leaders in search of large-scale, lasting social change.
Galen Welsch, Co-Founder and CEO, Jibu
Galen co-founded Jibu in 2012 and under his leadership, Jibu has quickly become a toprated
B-Corp social franchise bringing affordable drinking water access to thousands, and
creating hundreds of jobs, mostly for youth, across East Africa. Galen’s achievements at Jibu
have been recognized by BBC World, the Guardian, Fast Company, the Franchise Times, and
by Forbes 30 under 30. He serves on the advisory board of the UNH Social Sector Franchise
• Innovative Measurement Breakthroughs in Health Sector Franchising
• Building the Social Sector Franchise Ecosystem: Current Organizational Support for the
• Developing a Research Agenda and Community of Practice to Catalyze the Growth of the
Social Sector Franchise Ecosystem
Updates on our inaugural Social Sector Franchise Accelerator
• Check in on our Inaugural Living Case Studies
• Introduction of the 2017-2018 Social Sector Franchise Accelerator cohort
You will join senior practitioners (from both the social sector and the private sector), investors, and thought leaders dedicated to furthering the use of the franchise methodology in the social sector. We invite you to engage with these participants about reimagining social change, sharing your perspectives on the potential for using franchising to deliver social goods and services, and your advice for how the nascent field can achieve growth.
Learn more about the SSFIR agenda, registration and travel and hotel logistics here: https://www.unh.edu/social-innovation/ssfi/roundtable .
In 2015 the United Nations brought countries together to commit to eradicating poverty by adopting 17 sustainable development goals to achieve by 2030. The goals are ambitious and will require new approaches to solving some of the most pressing problems that plague people around the globe, even though solutions to those problems exist. How does this involve franchising? Read on!
Why disrupt the status quo?
The technology for meeting basic human needs for healthcare, nutrition, safe drinking water, sanitation, clean energy and education all exist and yet all too often, the solutions are not finding their way to the people who need them. Clearly, traditional approaches are insufficient. President Bill Clinton famously said, “Nearly every problem has been solved by someone, somewhere. The challenge of the 21st century is to find out what works and scale it up.” No-one is better equipped to meet that challenge than people who are familiar with the tools of commercial franchising.
Solving basic needs
Franchising has the potential to increase access to products and services that solve basic needs by scaling the concepts that have already been developed and proven to be both socially impactful on the community, and profitable to the business owner. Franchises of this type are often referred to as ‘social franchises’. In addition to solving social needs, social franchises, like commercial franchises, have the potential to stimulate economic growth by bringing businesses into communities, creating jobs and wealth opportunities and developing building skills that can be transferred outside of the franchise. By doing so, they can also create a middle class.
THE FRANCHISE ASSOCIATION OF SOUTH AFRICA COMMITTED TO INNOVATION AS A WAY TO TACKLE UNEMPLOYMENT AND CREATE JOBS
Reacting to the Statistician-General of Statistics SA Quarterly Labour Force Survey that shows unemployment rising to a 14-year high with 27.1% of the population without a job, the Franchise Association of South Africa (FASA) believes the franchise sector, which contributes 11.6 percent to the country’s GDP and employs over 400 000 people through its 757 franchise systems and their 35 111 franchise outlets, can play a key role in creating the necessary jobs to grow the economy through innovative venture creations.
With the gap between the unemployment rate envisaged by the National Development Plan (NDP) and the current rate widening and with Government’s goal of 5 million jobs by 2020 fading fast, the only solution for real economic growth to happen, is if 90% of South Africa’s jobs come from small business.
Says Tony Da Fonseca, FASA’s Chairman for 2017/2018, “Solutions to the employment challenge need to be tackled as a matter of urgency. We as the franchise community have the business format expertise to assist in the establishment of new franchises in a variety of sectors not yet franchised – be it in agriculture, manufacturing or even in government’s social services. But we need to mobilise business and industry leaders, government and civil society to play a part in freeing up economic regulations and find creative solutions to allow entrepreneurship to flourish.”
It has been proved time and again that small and medium enterprises (SME’s) are the backbone of every economy around the world. According to Vera Valasis, Executive Director of FASA, who represents South African at the World Franchise Council, “small businesses are creating two thirds of the jobs in developed countries and a large percentage of those small businesses are through the franchising business format. There is no reason why South Africa cannot drive the same growth through franchising that countries such as Brazil, China and India have shown.”
Many of the Franchise Association’s members are already exploring new ways to empower small businesses and entrepreneurs in bridging inequality, creating prosperity and employment.
According to Anita Du Toit, Director at Franchising Plus, franchise consultants who have pioneered the piloting of social franchise projects, there should be more programmes with a focus on skills development and that certain skills could be turned into sustainable micro franchises, thereby helping these franchisees to earn a living and removing them from the job seeking market.
“We have always said that painters, tilers and such trades could be franchised under the umbrella of a big retailer or paint manufacturer. This would solve the problem of consumer perceptions of the credibility of independent contractors while also ensuring a central referral system, ongoing training and support and helping such tradesmen to earn a good living as a small business operator. The focus should move from job creation to the creation of sustainable small businesses. Franchising offers a mechanism to enable this.”
Kobus Oosthuizen, former Chairman of FASA and MD of SA Franchise Warehouse, has, for the past few years worked closely with government on several initiatives to stimulate entrepreneurship, skills transfer and job creation. In 2014, an initiative from the Jobs Fund, and in conjunction with Business Partners, resulted in just under R100 million advanced and more than 600 jobs to be created by the end of 2017.
The second round of an emerging franchisor initiative spearheaded by the Department of Small Business Development’s Micro Franchisor Development Project will see the number of businesses replicated total twelve. “There is no doubt that these projects” says Kobus Oosthuizen, “will go a long way to enhancing the reputation of franchising as an enterprise development mechanism, whilst playing a valuable role in reviving township economies, creating new businesses, passing on important skills and more importantly, creating much needed jobs.”
Tony Da Fonseca, MD of the OBC Group and Chairman of the Franchise Association of South Africa (FASA), believes that the franchise sector is perfectly poised to take the lead in transforming the business landscape and make an even bigger contribution to entrepreneurship, skills transfer and job creation.
“As a group of progressive franchise entrepreneurs, historically and against the odds of sanctions, we created a franchise sector that today boasts over 90% home-grown concepts. Sustainable economic transformation can become a reality only if the public and the private sector come together to optimise limited resources and utilise available opportunities to best effect,” says Da Fonseca.
The franchise community will gather at the annual FASA Convention sponsored by Absa to network with industry stalwarts who will be sharing their leadership styles and how they are tackling the challenges in franchising.
The Convention takes place on Thursday 29th June at the Kyalami Grand Prix Convention Centre from 08h00 to 16h45 ahead of the Franchise Business Festival which takes place from the 30th June to the 2ndJuly – showcasing franchise and business opportunities. For more information visit www.fasa.co.za or email email@example.com
Dr. Rozenn PERRIGOT
Director of the Center in Franchising, Retail & Service Chains
Graduate School of Management (IGR-IAE Rennes)
University of Rennes 1
In the context of the growth of franchising in the social sector, and more specifically in the health care sector in Africa, it is important to understand how franchising can contribute to the development of the sector, from the quality of treatment and services offered to the performance of the companies.
This CFW network case study’s objective is to understand and assess:
The methodology of this exploratory study is qualitative and based on:
This multi-level approach involving people from headquarters, franchisees, an employee of a clinic,
customers and a prescriber has allowed me to gain a global overview of CFW activities and
operations, the CFW franchise business model and CFW challenges and future prospects.
The following findings and recommendations have emerged from this study:
Valorizing CFW organizational know-how: In addition to the know-how that has been implemented and codified by CFW before being transferred to the franchisees, CFW has important organizational know-how at the headquarters’ level. Specifically, I refer to the codification of the business know-how, franchisee training, the audit of the clinics and the supply of medicines. Another example of relevant organizational know-how of CFW is the CFW Outlets Compliance Code that is “a code for the Field Officers on how to handle non-compliant CFW franchisees. It defines contraventions of specific CFW franchise standards so as to clarify the relevant steps an officer should take.” It would be appropriate to proceed to a detailed audit of all this organizational know-how and valorize it:
Considering the evolution of the CFW concept: In terms of evolution of the CFW concept, it appeared during the interviews that there was an interest in expanding the services offered by the CFW clinics, as well as opening hours of the clinics. First, according to CFW customers, services and facilities provided by the CFW clinics could be expanded. Interviewees mentioned specifically vans, deliveries, laboratories as well as adding wards for in-patient care. On the one hand, this would be a way to better meet customers’ demands and, on the other hand, a way for the franchisees to develop their activities and then make more money. Second, two customers who would like 24H/24 service also suggested expanding the opening hours of the clinics. The associated issue would be the cost associated with expanded opening hours.
Better assessing customer needs and expectations: In addition to this exploratory qualitative study, a questionnaire-based survey given to customers would be very useful in order to assess customers’ needs, expectations and also satisfaction.
Living Case Study Webinar -- Measuring Social Sector Franchise Impact: How Lean Data measurement can help improve franchise impact and success
Wednesday, June 7, 2017
10:00 a.m. - 11:00 a.m. (EST)
By definition Social Sector Franchises promise to deliver needed goods and services at scale with measurable social impact. While a large number of tools and frameworks are available for measuring impact there are limitations to how well they will keep up with franchise growth without becoming prohibitively cumbersome or costly. In this webinar we will review a few of the more common approaches to impact measurement and their limitations and will learn about an exciting new tool for impact measurement developed by Acumen. In its application across the globe Lean Data is making it possible for social enterprises get accurate and timely data at relatively low cost and ease of implementation.
Guest moderator Fiona Wilson, Executive Director of the Center for Social Innovation and Enterprise will be joined by Greg Starbird a social franchise expert to discuss the importance and challenges of impact data measurement in social sector franchising. Fiona and Greg will be joined by Ashley Speyer Acumen’s Lean Data Senior Associate who will describe this exciting methodology and give examples from its use with several of Acumen’s social businesses. A question and answer segment will give broadcast viewers a chance to interact with our webinar guests.
Living Case Study Webinar -- Creative financial models to drive social franchise success
There are a range of investment vehicles currently used to support social sector franchises in health, water, sanitation, education, clean energy, and agriculture. Each is attracted to the tremendous potential that the franchise model can deliver for social and financial returns. That potential can only be realized when social franchises are developed in a methodical way that requires different types of resources at various stages of growth. Better coordination among financing institutions to create blended financing options that drive healthy growth of social franchises will benefit investors, investees, and the people that social sector franchises serve. In our second webinar guest moderator Julie McBride of MSA Worldwide will engage guests in a discussion around current financial products and investment practices and opportunities for creating more strategic ways to support social franchising. Guests include Michael Swack from the Center for Impact Finance at UNH a leader in the impact investment field, John Simon from TOTAL Impact Capital, a boutique finance firm specializing in sourcing and developing private investment opportunities that are socially and financially attractive and Randy Welsch, Co-founder of Jibu, a for-profit business with the integrated goals of making money and making charitable impact.
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First Living Case Study Webinar -- Jibu Rwanda - Infusing Lessons Learned for Intelligent Scaling
The Center for Social Innovation and Enterprise's Living Case Study Social Sector Franchise Accelerator is an action learning and research project, which will take place over eight months with three entrepreneurs who are new or emerging social sector franchisers. Jibu is rapidly expanding its clean water franchising in East Africa recently opening a new franchise center in Kigali, Rwanda. Our first webinar moderated by Bill Maddocks will explore how Jibu’s expansion is progressing and we will talk with LCSA protégé Mark Mutaahi, his mentor Peter Holt, Jibu co-founder Galen Welsch and Rwanda country director Nathan Dowling about operational challenges including the need for proper training and data to drive decision making as franchisees are recruited and a marketing strategy is plotted.
Broadcast participants are encouraged read the LCSA Jibu page and blog entries and come to the webinar ready to ask questions and be active members of this real time learning opportunity.
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