With four new franchisees added to their team within the last 3months, The Leather Doctor continues to build success throughout Australia. Such significant growth has seen The Leather Doctor become Australia’s largest furniture repair network. Now clients in Adelaide, Illawarra, NSW Central Coast, and Canberra have more convenient access to leather cleaning and repair services and, thanks to the generosity of Director Dean Reid, a thirteenth Melbourne location was added to the list of new franchisees. “One of those was actually from a prize we gave away,” he says. “It was a huge promotion that we did last year at the Melbourne Franchising Expo. We invited applicants to explain the reasons why they would be a worthy winner, and we selected a winner as a big promotional prize. We wanted to show people that when you remove the money it becomes purely about selecting the right people. People who fit The Leather Doctor culture. The couple who were the lucky winners received the franchise at no cost, but they’ve gone on to buy a second territory because they’ve been doing so well – it’s in the Geelong area of Melbourne.”
The company has also appointed a new operations manager at their head office from a local Gold Coast franchise location. Mr Reid is confident that this change will promote increased franchisee support from head office in the coming years. Currently, The Leather Doctor has 62 locations nationally, with outside support in New Zealand and Dubai. The goal for the next three years is to reach 100 franchisees, and added assistance from management should assist in achieving this benchmark. “We sell franchises by geographical territory that’s made of about 150,000 population base,” he says. “The opportunity’s great for a franchisee that desires a nice balance of great income and an enjoyable lifestyle.
An additional part of the benefit is the franchise has a scope for franchisees to employ other operators so that, for those that may not want to be hands-on on the tools but still want to have the financial benefit of their business running, they can have people working for them, going around in vehicles doing the repairs. We have several franchisees around the country that have up to three people working for them – three vehicles. So, it’s a scalable business as well. It allows a franchisee to grow if they want to invest the time and effort, but if they want to stay small they can do that as well. We focus on the furniture industry, although we can do repairs and maintenance to car interiors, boats, or anything else made of leather, vinyl, or synthetic material. It’s really all about repairing surface damage – scratches, tears, burns, and cuts – cleaning and then, of course, colouring; things that are worn, faded or stained, or leather that’s worn out and tired, and we can rejuvenate it and bring it back to looking close to new again.”
Mr Reid believes that the low fee base is also a benefit for franchisees of The Leather Doctor. The Leather Doctors fixed franchise fee is one of the lowest in the industry at $220 per week, allowing franchisees access to a larger amount of the profit. “There’s a guaranteed work stream that comes in from one of our sister companies that does all the warrantee repair work for the retail furniture industry here in Australia,” he says. “We use the franchise network of Leather Doctors to fulfil a lot of those repairs. So a Leather Doctor knows that if he’s joining the franchise he can tap into that work, he doesn’t have to spend on advertising dollars, and all this sister company charges is 5 percent of the invoice for the benefit of having all this work. We don’t take the marketing levy; there’s no other levy they need to pay. It gives them the ability to keep the large percentage of the sales that they make and ensure profitability; good strong sales, low overheads, and they don’t need to work 7 days a week to get a very good income.”
Relationships with suppliers, along with the Franchise Council of Australia, are integral in order to guarantee the prosperity of The Leather Doctor and its franchisees. Mr Reid stresses the importance of honesty – especially with suppliers – as product quality is a key contributor to the overall reception of the company’s services. “We have a very specific range of products that we need to use to complete repairs, and we have a great relationship with our suppliers that give us those products,” he says. “So, the quality’s high and the delivery to the franchisees is consistent.
We find that working with them regularly on the performance of their products – any adjustments that need to be made – and making sure we support them as well by working with them, we don’t feel that we need to push hard on getting the absolute cheapest rate from every supplier. We feel that if they’re running their business at the profit margin that they need to, then they’ve got the resources to give us the support that we need from them. If we were to push them and take every last cent out to the point where they resent supplying us, then we don’t have a good relationship. So, we feel that it’s important to purchase products at fair prices so that they’re profitable as well.
In the industry – more from associations like the Franchise Council – we find it’s really important to get knowledge and just keep a finger on the pulse of what’s happening in the industry. If you don’t have that connection with these industry bodies, you can lose sight of where industry’s going. For us, we tap into the furnishing industry bodies a lot – the big furniture shows; one recently just happened in Melbourne. We like to participate and be part of those just to see where the market’s going, what the trends are, and really what the needs are. I think that’s really important to do.”
Over the last few years, according to Mr Reid, the franchise industry has become much more stable in its composition; conformance and compliance procedures have improved and governing bodies, along with the Franchise Council of Australia, have worked hard to ensure that the necessary support is provided by franchisors, and franchisees are well protected through good quality business. “The franchise industry will benefit as new business ideas come on,” he says. “I think the structure is there and is solid in Australia, and the governance is really good. So, I think it will benefit to see more creativity in the type of services and products that can be franchised as a business.
For us in the leather repair business and industry, we find it’s quite a stable and mature market – keeping abreast of the latest trends in furniture and upholstery, making sure that our techniques and our products are giving customers great results with their leather goods. I think technology is going to continue to help us. We’ve always been an early adopter of technology whether that’s in our job tracking software, how we report an invoice, or even what we put on our website, and use technology to get across our products and services. I think we can do better in that respect in making it easier for customers to find us and easier for them to purchase from us.”
Going forward, Mr Reid has high hopes for the future of The Leather Doctor and its growing franchisees. This has been their first year submitting for recognition through the Franchise Council of Australia’s Excellence in Franchising Awards, including the top three in the country for Franchise Innovation category and top five best established Franchise in the country. The company will also continue to pursue its aforementioned goal of 100 franchisees, with further expansion into international markets like Singapore, Malaysia and the United Kingdom on schedule for the upcoming years. Mr Reid also provides words of advice for those looking to commence business through a franchise.
“It’s important to do your due diligence,” he says. “Ask the operators that are running the business day-to-day – if the franchise owners themselves get out there on the tools, serve the customers, or they’re at the front counter – what it’s like running the business. The advertising that comes from head offices can be glamourous and paint a very rosy picture; but, talk to the people owning the franchise and running it day-to-day to see where the not so pleasant aspects are, because every business has their challenges. I think you need to do that before making decisions to join and jump into any franchise.”