Powering change

A period of extensive change has paved the way for unprecedented growth across Battery World’s national franchise network. By Andrea O’Driscoll.

BATTERY WORLD’S general manager James Nixon-Smith was brought into the company in 2004 to reinvigorate what was then a trade-based franchise system with a tight focus on the automotive sector. Over the past five years Battery World has been transformed into a strong retail brand and almost doubled its revenues to an expected $60 million for the 2009 calendar year.

But implementing change on that scale across a 100-store franchise was no easy task.

Battery World’s sales have almost doubled during the past five
years under the direction of General Manager James Nixon-Smith. Battery World had been formed in 1997 by one of Australia’s leading automotive battery manufacturers, Century Yuasa, as a retail channel for its product range. The focus in those early days was very much geared towards promoting the Century brand.

“In the beginning around 95 per cent of the business fell into the automotive category, whereas today it’s about 43 per cent,” explains Nixon-Smith. “For the first six or seven years it was really just a trade offering that appealed to 18 to 45 year old do-it­yourself types of men. I joined in 2004 to look at ways that we could capitalise still further on that.”

Nixon-Smith started by conducting extensive research into how the brand was perceived by consumers. “In 2004 we looked at some research which gave us insight into what our customers saw,” he says. “We also had a good look at how the stores were presented. Given that we sell batteries for everything from home appliances, watches, toys and cameras to solar panels, power tools and cameras, we needed to make sure we had that broad appeal. We knew that we captured the handyman end of the market, but what about the 25-year-old females? We knew we had to change to capture all of our potential market.”

The first area of the business to attract Nixon-Smith’s attention was the IT system. “We had something like 17 different bits of software within the group,” he recalls. “As you can imagine, it was just delightful! We rolled out a network-wide IT platform in 2006/7 and then that became the springboard for even more change.”

The changes ranged from implementing a national point-of-sale program and updating store fit-outs to executing a new national marketing strategy and even amending the business model. “We unrolled an entirely new store fit-out, we introduced new merchandising, we redefined our own service to our franchisees in terms of what we need to do and how we need to do it and we also changed the business model,” explains Nixon-Smith. “Battery World was originally based on a supplier rebates model and we moved it to a royalty model as we felt that was more sustainable in the long run.”

Persuading franchisees

Walking franchisees through the full sweep of changes was always going to be a challenge. It required the establishment of effective two-way communication channels to ensure that the franchisees remained fully informed about every aspect the process, and management stayed abreast of any concerns they might have.

“We took a four-pronged approach,” explains Nixon-Smith. “Some stuff we could just send out in writing. We set up a bi­monthly newsletter that went out to all franchisees and staff. We also met face-to-face with regional franchisee groups, had monthly meetings with our business development managers and provided the opportunity for individual franchisees to meet with the whole management team, either in their shop or in another location of their choosing, to run through any specific issues they might have. We met with the National Development Council and distributed the minutes of those meetings to all our franchisees and I would do two roadshows a year.”

Inevitably, given the scale of the necessary adjustments, not all of the company’s 100 existing franchisees were comfortable with the business’ new direction and some decided to move on. “The profile of our franchisees changed fundamentally,” says Nixon-Smith. “The company has evolved from a trade offering into a full retail business. These days it’s not unusual for us to be located next to a Subway restaurant. Some of our franchisees did decide to move on. Now we have around 72 strong retailers that value the brand.”

New franchisees

Battery World also recruited between 20 and 30 new franchisees during that time and implemented a more rigorous selection process to ensure that franchisees would help move the business forward. “We had a really good look at how we recruited new franchisees,” explains Nixon-Smith. “We also employed tools to help us with our selection process. We now put them through a profiling process and there’s a four-week intensive training program that includes a lot of practical time in-store. We hired a specialist recruiter in Melbourne in addition to our in­house recruiting team. We also kicked off a company store initiative last year. We now have three, one in Sydney and two on the Sunshine Coast, to assist with ensuring that the business model is right, training new franchisees and trailing new products.”

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