RIDING THE JETSTREAM ON A TRAIL OF INK

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Riding the franchising jetstream on a trail of ink
When founders Narbeh Ghazalian and Mike Shudlik first planted the Printwells’ flag four years ago, both admit they weren’t exactly seasoned veterans of the franchising game.”We had both just graduated from university and it was a school project, to make a long story short,” says Mr. Shudlike, the company’s president. Printwells specializes in refilling old and empty inkjet cartridges from kiosks located in shopping malls.”It looked good on paper, and we decided to start it up.”And start it up they did. After opening their first location at the St. Laurent shopping centre and running it for a year they took their show on the road, opening franchises in Quebec and Ontario. The company now boasts 11 locations in Montreal and Ottawa, is opening a new location this week in Toronto, and both executives say the company hopes to hit 20 by year’s end.Despite their success, however, both say the exercise of franchising is no rose garden, especially considering their relative inexperience. Franchising, say the experts, isn’t just about getting as many stores out there as possible – although that’s certainly a big part, especially in retail.”The lack of experience me and Mike had from day one,” was the most difficult thing in expanding the business, says Mr. Ghazalian, along with educating people that ink-cartridge refilling as a service even exists. “We both have marketing degrees from the University of Ottawa, however the lack of real experience in franchising was the most difficult part of our operation.”I feel we almost had to work twice as hard to expand successfully.”They had to learn their lessons the hard way, says Mr. Ghazalian, even though both have entrepreneurial parents who mentored them along the way. Seeing the results, however, you wouldn’t know it: Six Printwells’ kiosk-style stores have popped up in Ottawa-Hull shopping centres in the past few months.Printwells franchises out full turnkey units, each with an initial cost of around $110,000 to $130,000. Each kiosk location is expected to take 18 to 24 months to pay for itself. Everything from initial store setup to inventory to training is done in-house by the company – they have an in-house training facility at the nine-employee corporate office in Ottawa, where franchisees are required to complete a two-week training course before opening.From the corporate office the company also handles all distribution, research and development, and taxation and financial issues.Steve Rosen, CEO of FranNet, a franchise consulting organization with offices in Ottawa, says devising a system like this before expansion is essential for any company considering launching a franchise operation.”If I’m going to write you a check every week for a royalty fee, if I’m a franchisee I have to feel I’m getting value for my dollars,” says Mr. Rosen. This is what’s referred to as a franchise’s value proposition, he says.”I’m not just going to write a check because I signed a contract five years ago. So the good franchises are the ones who give value to their franchisees.”He names big outlets like McDonald’s as the most obvious examples of successful franchising operations, and says the franchises who most often fail usually exercise little self-discipline and don’t stick to their plan. “If you look back historically,” he says, “there have been many franchisors who have failed because they didn’t have the discipline to turn down the one person who says ‘I love your concept, and I want to do one over here, here’s a cheque.”But you need discipline to say ‘Strategically, that’s not a good fit right now.'”In other words, controlled growth in strategic areas is key. He says Printwells – which just became a member of FranNet – is right on the money. It has focused on just two urban centres (now three with the new Toronto store) to get the most bang for its advertising buck, especially considering the relatively obscure product.”It’s a very niche market, and there’s not too many people doing it right now,” says Mr. Shudlik, adding that the company has a five-year plan to expand to 50 to 60 stores across the country, all the way out to Vancouver.”You know what?” he says. “My parents had always told me this. Once you’re into something and very passionate about it, and you see the light at the end of the tunnel, it’s almost like a disease. You just want to keep striving, opening locations, and keep moving.”It’s addictive, definitely.”

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August 29, 2006 at 9:54 AM