The Danish brand’s global business development director, Brian H. Nielsen, explains why BoConcept is now looking for multi-unit franchisees
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WHAT QUALITIES, EXPERIENCE, AND TRAITS ARE YOU LOOKING FOR IN BOCONCEPT’S FRANCHISE PARTNERS?
BN: Our primary target is to find multiunit partners that will operate the businesses themselves. Multiunit franchising is a challenging proposition; individuals who want to build a franchise empire must demonstrate many qualities, skills, and abilities if they are to succeed.
Ambition, being service-oriented, having good networking skills, communication skills, and the ability to lead and delegate are all vital – as well as, obviously, personal integrity. Having experience in retail is an advantage, but not a prerequisite.
Partners must have the financial capability to build up the business until it can be self-financed.
WHEN AND WHY DID YOU POSITION YOUR STRATEGY TO ATTRACT INVESTORS THAT CAN SIGN MULTI-UNIT DEVELOPMENT PLANS?
BN: We changed the strategy two years ago. We could see that the business potential had not been fully utilized, due to weaker performing franchise partners who lacked the ability to open the potential number of units within a region. At the same time, we could see that franchise partners who had more stores were performing at a higher level. Multi-unit franchise partners are able to develop faster and more successfully overcome obstacles and headwinds. They are typically more connected in the market and usually have opportunities to find better locations and recruit better employees. As a franchisor, we find multi-unit franchise partners require less monitoring.
HOW SUCCESSFUL HAS THIS DIRECTION PROVEN FOR BOCONCEPT?
BN: We have already seen the benefits of onboarding franchise partners with a multi-unit mindset: they present the ambition, ability, and financial capability to expand faster.
An example would be one of our franchise partners who invested in Mexico two years ago. As well as expanding within Mexico, he has also decided to develop within Florida, having currently reached seven stores, with many more to come in the next few years.
WHICH REGIONS, TERRITORIES, OR COUNTRIES ARE YOU LOOKING FOR MULTI-UNIT INVESTORS TO OPEN STORES IN?
BN: BoConcept is already represented in 65 countries and thus we already have several multi-unit franchise partners, as well as a few master franchisees in a number of markets.
Our priorities right now are the USA and Europe. In Europe, we are looking for multi-unit franchise partners in our two biggest markets of France and Germany. In these countries, we are looking for franchise partners to develop specific regions.
“Multi-unit franchise partners are able to develop faster and more successfully overcome obstacles and headwinds”
For smaller markets, we are aiming to have only one multiunit franchise partner to develop the whole region. This could be the case for countries such as the Netherlands, Belgium, Switzerland, and Italy. We aren’t excluding the possibility of developing elsewhere if we find the right multi-unit partners.
We can open in any market where there is the potential of three-plus BoConcept stores; our concept is proven to have a global scale, and we really do not see any limitations.
WHAT WILL MULTI-UNIT FRANCHISE PARTNERS GET FROM BOCONCEPT IN RETURN FOR THEIR INVESTMENT?
BN: There are numerous ways of calculating a return on their BoConcept investment. Our focus over the past few years has been to create a strong business model that provides double-digit EBITDA to our franchise partners.
Our aim is to reach a lower investment level per location and this, combined with an attractive EBITDA, will consequently lead to lower payback times.
Many investors also require a plan for an eventual exit. BoConcept has developed a very attractive exit model, which includes a fixed exit price based on performance.
WHAT DOES YOUR ROLE AS A GLOBAL BUSINESS DEVELOPMENT DIRECTOR ENTAIL?
BN: The primary role of a global business development director for BoConcept is to find strong future franchise partners for the brand, that will enable both parties to grow successfully and utilize the full market potential that our concept provides.
If this relates to a greenfield area (a market without any stores), the franchise partner will open a number of new stores to develop the region.
However, having operated as a franchisor for more than 25 years, many of our markets already have franchise partners. In these markets, it is often more beneficial for the new franchise partner to work with existing partners to establish the takeover or transfer of the existing stores. This is also part of Business Development activities.
WHAT DO YOU ENJOY MOST ABOUT WORKING FOR BOCONCEPT, AND HELPING TO PROPEL ITS GLOBAL GROWTH?
BN: I think it’s difficult to find anything more motivating than working with ambitious people, that want to grow their business. In this role, you also get to meet many different types of people and experience various different cultures. WHAT DOES THE FUTURE HAVE IN STORE? Retail is constantly changing, and thus it is difficult to predict the future. There is no doubt that we will have to be agile and able to provide the best customer experience in our stores. The contract furniture industry also presents a huge potential market, and that’s why we are already investing significantly in this segment. E-commerce is also something we will be taking into account in these next years.
BOCONCEPT WAS RECENTLY NAMED THE BEST LIFESTYLE FRANCHISE IN THE GLOBAL FRANCHISE AWARDS. WHAT DID WINNING THIS AWARD MEAN FOR THE BRAND?
BN: Having been awarded the Best Lifestyle Franchise in 2019 provided a great satisfaction, as it recognized BoConcept’s excellence as an international franchise system; it rewarded all of our efforts to build a passionate brand around the world, and be the very best franchise system for our franchise partners.
AT A GLANCE
Name of franchise: BoConcept
Established: 1952
Number of franchised outlets: 325+
Location of units: Units in 65 countries around the world
Investment range: €350,000 – €650,000 per unit
Minimum required capital: €500.000 liquid funds, €1.5m net worth (for a multi-unit setup)
URL: https://www.boconcept.com/franchise
Contact: franchise@boconcept.com
