A start up case study - Annette Corrie
I mentioned earlier Annette Corrie who came and presented in our workshop a while back and we were able to film her talk and her background. She’s going to share a little bit of her history. Annette Is someone who’d never been in business before opening this one. Her family and her friends, who’ve never been in business said, “Nettie you’re mad. You should never go into business, you’ll lose your money. You know what happens, you read about it in the newspaper….”
She’s going to share a little bit of her story and what I’d like you to do when you’re looking at that is think, “Wow! Here’s this young lady, who’s never been in business, who’s fed up with being made redundant, who came from the fashion industry and opened her first business and think about what she achieved because she just applied a can-do attitude and you’ll see the evolution from a business which was falling down around her and where she is almost, screaming to get out, to creating a very valuable, significant franchise group.
I actually run two wedding companies, one of them is ‘All About Venues’.
They’re both based in the Gold Coast. I guess one of the biggest benefits that franchising has given to me is the flexibility to do what I want. I guess my goals in life are just to be out there, live that beach bum lifestyle and travel around the world when I want to and to not actually be tied down to a physical business.
Bur, particularly working weddings, you have to be really reliable and you get phone calls all the time and you have to return them within 24 hours otherwise you have brides absolutely freaking out if you don’t reply to emails or phone calls. So I guess when I first started my business, after a year I felt really trapped because, if I wasn’t there, the business didn’t go anywhere and there were a lot of break downs. So, for the first year I took no holidays. I was run to the ground, working six to seven days a week and there were many weekends I’d call my husband on the phone all in tears going, “I can’t handle it!” There’d be these different things happening like linen wouldn’t turn up. But you need to deliver a wedding. There is no “I don’t have time,” you can’t be late, everything has to be a hundred percent. So we’d have lots of different breakdowns like that. I was trying to do it all by myself. I didn’t have staff and it just wasn’t a very good business model. I worked that out quite quickly when I got to the point of “I’ve had enough, I want to sell the business.”
So I went to a business broker, and he gave me a business valuation of about $30,000 and he said I’d very lucky to even sell it for that much because it was worth nothing. It broke my heart because I’ve been working my ass off but he just said, “You know you’ve only been operating for a year. No one’s going to buy a business that’s only been operating for a year and you’ll have a really difficult time selling it.”
So I decided to franchise about 18 months ago. It took me three months to put the system together. I had a consultant actually talk me through it which was amazing because when you’re trying to translate anything in franchising it’s, “what does that mean?” So the consultant really helped me and I settled on my first franchise the very first month my documents were ready for my solicitor and I made this first sale with no marketing. I had a pre-sale simply because I was just telling people what I was doing and I also shared with my staff. It was actually a staff member who was working for me five hours a week, only five hours a week, who bought the very first franchise. So it was pretty cool, selling a franchise as soon as it was ready.
And now, 18 months later I have five franchisees. I settled on number five last night. So I was very, very excited, true.
I guess the main reason I am so excited, is thinking back to when my business broker told me, “Your business is worth nothing, you’ve only been operating for a year, you’ll be lucky to get $30,000,” and knowing the main reason I wanted to sell in the first place was to have a lifestyle where I could travel and a business which didn’t rely on me being there a hundred percent of the time and knowing that’s the life that I’m living now. Last year, I went to, pretty much every after a franchise sale I go on a big overseas holiday and last year I went to Hawaii and then I went to Bali twice and then I went to Hawaii again in December and then New York and then the Bahamas and we’ve just come back from a month in the States. While I was in the States, the whole time I was away, there was a franchise being processed and my solicitor was looking after it. I came back this week, all the documents were already signed and yesterday I signed my bit. So that’s the kind of thing that I still can’t believe. This year has probably been the biggest for me because I moved from actively working for money to money coming to me.
Now my company has a valuation of about $300,000.
I don’t know anybody else who’s got 10 times the value in two years and there are certain things I’ve done in the last two years which have given me that kind of valuation.
Okay, now that was about three years ago.
What’s happened subsequently is that Annette continued to grow the franchise business. She had problems to begin with. I mentored her at that stage because she was really having problems with converting prospects. She told me they wanted to franchise and she spent lots of time with them but when it came down to settling they couldn’t come up with the money. So I mentored her through in the franchise application process. How you handle that process delicately enough to avoid offending people while making sure that you’re not wasting your time on people who aren’t appropriate. Whether they have the skills or not, having finance available, knowing brokers you can use and so on.
She actually went through an amazing stage in her growth. You can see that the cost to set up is not significant around $30,000. Annual fee income on average, I’m guessing at figures here, at $80.000.
She actually ended up selling 15 franchises including a couple of State ones for NSW and WA.
One important thing to note is, when creating her franchise, she actually formed two businesses from her single wedding business. Although she mentioned that, she did not go into detail. But she found it was just too difficult when she started running the franchise, to handle the wedding ceremony, which might be on the beach, and the celebration which would be in a separate location so she did the obvious thing and split them into two. She created two franchise groups which were complimentary and that really was quite significant.
As a result, in less than four years, she is at the stage where she’s sold the whole the franchise groups to a Master Franchisor for Australia. But she has retained all the intellectual property, only selling the rights for Australia, in that process after the four years, making about a quarter of a million dollars.
Not bad for somebody who said “I’m going to give up,” after the business broker valuation at $30,000. You can see what she achieved as an unsophisticated business person just by getting on doing it. Well I guess that was one of the reasons for her success, she didn’t know better. If you know what I mean. We can all put problems and challenges in front of us but she got on with it.
That’s a great story.