Jim Penman describes how new Jim's divisions start: anyone with industry knowledge and a strong service record can propose one. The division needs to hit 30 franchisees in three years, with each franchisee earning roughly $60 an hour. The main cost is a $4,000 monthly fee paid six months upfront, plus the time to build the manual, branding, and website.
A new gyms division starts when somebody comes to us with an idea. Now, this could be somebody successful franchisee. And we look for somebody who's got a good customer service record, making good money, sort of positive, helpful kind of person. Can be an existing franchisor. That's quite common these days, like laundry started from existing franchisor. Can be a completely independent person. What we want is a division that we don't already cover. It doesn't. It can't conflict with another division because there's territory rights involved. You can't do anything that would sort of get involved with, say, basic handyman purposes, because the handyman division has that. We look for somebody who's knowledge and understanding of the industry concerned. So they've got a background, they know what to charge, they know what kind of skills are needed, what sort of training, what sort of qualifications, if any. We need to see the. The average person being able to make at least 60 bucks per hour. I'm not talking about the best. The best should be able to make a lot more than that. But an average person without any special strength, with a bit of practice, should be able to make at least 60 bucks per hour. And ideally, we'd also like a division that's got a fair amount of scale to it. There's not a lot of point in having a franchise that can only have six across the whole country. We've had some great ideas, but they're just too niche. We'd like to see the potential for at least 100 franchisees because the gym system doesn't make a lot of money per franchisee. It's based on numbers. If you've got 100 franchisees, you can get good support and so forth. Now, the interesting thing about starting a new division is that it's actually not very expensive. It really doesn't cost much more than the standard franchise. We have a system called a rental, so there's an ongoing fee of about 4,000amonth, which is paid six months in advance. Apart from that, there's no cost. We don't actually charge for the division as such. What we do is we put a requirement on the franchisor to achieve 30 franchisees within three years. Now, that's not impossible or even that difficult, if you said about it right, if you put some energy into it. Laundry achieved that in about. In the first 18 months. They've now got over 70 and it's less than three years. So. But there is a lot of responsibility on a divisional founder. They've got to do things like got to write a manual, because we can't write that. We write the generic manual, but the divisional manual. Got to help design uniforms, logos and things, with our help, of course. And they've got to set up a website. So there's some fairly heavy investment, mainly of time, to get these things off the ground. But having said that, not a big investment. Mainly an investment in time and effort rather than in money as such.
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