United Petroleum currently has more than 300 sites across Australia, 40 of which are franchised. It aims to convert 80 percent of its network to franchises over the next five years.
“We are at a stage in our development where we are making an increased effort towards improving our franchise network and more importantly recruiting the right franchisees for our sites,” says franchise sales manager Adrian Gallace.
He explains United offers all of its franchisees existing rather than greenfield sites. “We remove the risk factor by selling existing sites, because there is a considerable financial investment involved in opening a new site, one that we can’t expect our franchisees to bare.”
United is not after franchisees with experience in any particular area, rather it seeks out individuals who display two key attributes.
“It is important to find someone that has a passion for business and who is willing to follow the system. In any franchise you can’t have people that want to come in and change the way everything works.
“We have a proven model and the knowledge so we just want someone who is willing to follow the system and enhance it in the right ways all the while maximising what they can get out of the business,” Gallace says.
United offers new franchisees a five week training program, which includes both on-the-job and theoretical components.
“The first week is full time and it consists of three days in our head office and three days in a tailor made facility at our Point Cook site. Franchisees undergo practical training and gain an understanding of the business, accompanied with theory,” explains Gallace.
“Franchisees will participate in three to four weeks of part-time training in different sites around wherever the franchisee will be situated, followed by training in the particular site they are going to acquire.”
A United petrol station. Image: unitedpetroleum.com.au
He says additional training is arranged for franchisees that may require that little bit extra. “If the franchisee has completed the training program and we feel they are not yet up to speed we will hold settlement back a couple of weeks – if we need to send them back to training we will.”
Ongoing support is facilitated by area managers that are situated in different locations across Australia, along with a national business development coach.
“Area managers are available to assist with the day to day running of the business; merchandising, site standards, customer service, staff training and ongoing franchise training being core components of that role,” he says.
“They engage with our franchises on a regular basis, monitoring their progress through our Measure Up program; designed to motivate, educate and assist franchises with reaching site KPI’s.
“Our business development coach deals with our franchisees on a one-on-one basis, with an emphasis on improving their financial processes and understanding of the business,” adds Gallace.
He explains United prefers that franchises initially work in their business, and they can eventually opt to work on it.
“I think it is important franchisees first work in the business and understand it because no business runs as well as it can when the operator is not there – and the last thing you want is your manager knowing more about the business than you, it puts you on the back foot.”
An entry level United franchise costs around $450,000 and Gallace says this includes stock, bank guarantee, some working capital, the franchise fee and goodwill.
“United offers vendor finance of up to around 40 percent of that figure on a case by case basis,” explains Gallace.
“$145,000 is the franchise fee and that gives you a 12 year agreement with United, and there are options for renewal.”
If you are interested in a United franchise, Gallace says you can submit an enquiry through either Seek or the United website.
“We then send potential franchisees an application and confidentiality agreement which they complete and send back to us, and then we arrange a time to meet up,” he adds.