Francesco group

Thirty-one salons, two expanding training academies and plans to expand the business by two salons a year. That's not bad going for a Staffordshire-based family-run company that started trading from a Morris Minor! "My father started off as a mobile hairdresser," explains Ben Dellicompagni, now managing director of Francesco Group, which today has an annual turnover of £9m, has 550 staff and sees some 700 learners through its two academies every year.Last year the company was awarded the Golden Scissors Award, the Bronze Award at Wella Trend Vision and was a winner of L'Oreal Talentspotting. Abandoning the Morris Minor, Ben's Italian father Frank bought his first salon, in Bridle Road, Stafford, and later joined forces with three partners. In 1970 he split from the partners to form a company with his younger brother, Peter, starting what was to become the Francesco Group. Soon the pair had nine company-owned salons and, keen to keep expanding, they made the crucial decision to recruit franchisees to expand the brand. Now the Francesco Group name is above 31 doors from Cheltenham to Chester, and from Newport to Newcastle. And what was a regional company is fast becoming a national brand. "At the time only Saks was doing franchising. We were the second company. Taking on the franchise was also a good way of motivating our managers," explains Ben, who joined the family firm only five years ago, and, not being a trained hairdresser, relies on cousin Anya, as director of hairdressing, to oversee the creative side of the business. Ben firmly believes that the company's success as a franchisor lies with the support it offers franchisees, not least the two training academies staffed by a team of 30. Both based in Stafford, the Lichfield Road Further Education Academy offers advanced courses for the company's own staff and for other salons. The Woodings Yard Foundation Academy offers modern apprenticeships and NVQs to students and has forged links with colleges in Derby, Stafford, Somerset, Walsall, Wolverhampton and now Taunton, to run courses on its behalf. Woodings Yard has five salons, three theory rooms, a photo studio, IT suite and student facilities. Support for franchisees includes the services of the team of 20 people at the company's head office. Marketing and advertising campaigns are also handled here - as are payroll, site selection and recruitment support. When salons are first opened the head office team get involved on a regular basis, until that business is up and running. So who does the group recruit as its franchisees? Typically, they come from within the business, says Ben, people who have worked their way up the ladder and are keen to branch out on their own. A few are recruited from outside. A franchisee pays a one-off fee of £7,000, as well as an administration charge for the head office functions and royalties on a sliding scale. "The better they do, the less they pay," he explains. All Francesco Group salons have a 'look', partly gained by using an affiliated shop fitter, which controls the fitting costs but gives the franchisee an element of choice. Franchisees are expected to operate a profit-to-turnover ratio of 15%-20%, and Ben is about to introduce a new turnover target of no less than £50,000 per annum. "A city centre salon should be doing around £15,000 a week," he says. "We've had the odd salon that hasn't made it, but we've never had to close one. "The model sounds very simple, but to make it work you have to have the training, the customers and the head office functions in place. The academy runs at a small loss, but it's important we have it to maintain the quality of the brand and our styling skills." The Francesco Group's latest salon opening is in Cheltenham, the furthest south yet. Ben hopes there'll be more in the area - perhaps towards Bath. His aim with new franchisees is to go into profit in their first nine months of trading, rather than the first 12 months they were expected to previously. "Cheltenham is a springboard to establishing the brand and reputation. Its success will have consequences for future growth," says Ben. And while he has no real desire to break into the London market, the company is led by where franchisees want to open, rather than where it wants to be. "If we had a franchisee that wanted to go into London we would consider it, but there's enough cities closer to home to enable us to double and treble the size of the company." So with 31 salons, how does the group ensure it's offering a consistent approach to customer care and hairdressing? "We have quarterly management meetings and focus groups on a quarterly basis where we discuss issues. For example, we're aiming to improve our consultations, so we'll all sit down and bash it out. Likewise, we have an issue with retaining new customers - we have an 86% loyalty with regulars, but need to improve the retention of one-off clients. That may come from training the stylists, but we'll work it out as a group. "I have a fantastic team," he says. "My job is to make sure the relationship between us and the franchisees is working, and in tackling the core issues we have as a group." So what about the future? Ben says one of the most exciting things for the group is its links with colleges. Some 80% of students who enrol on a Francesco Group modern apprenticeship go on to complete the course - a better completion rate than the national figures, where two-thirds of young people fail to complete modern apprenticeships. "We're forging links with Taunton College now, so this could roll out nationally. The way education is going, with people being trained until they are 19, means there will be more and more money to support people with their learning. It's very exciting for us," says Ben. And he's realistic enough to know that the efficiency of the business can improve. "We do what we do and we want to keep on improving," he says, adding that with a £450,000 profit on a turnover of £9m, there's also ways the company can improve its profitability. His aim is to expand the company by two salons a year, but only thinking about the next salon once the latest opening is trading well. Even though the name of the game was always expansion, Ben says his father would never have envisaged the group would become the fourth-largest hairdressing group in the UK.