Engineering Franchise 4

[SeanDotson]

I received some info today about an engineering franchise. Was curious if any of you knew anything about this company. The theory of an engineering franchiose sounds promising but I wonder what the reality is...

http://www.productiveresources.com

Thanks,


Sean Dotson, PE
Autodesk Inventor Certified Expert

http://www.sdotson.com

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[RDK]

Franchises usually bring two related things to a business. The first is name recognition. When you thing about fast foods and McDonalds you know what you are getting when you see those Golden Arches.

The second thing that they bring is a standardized way of doing business, a similarity of product if you will. That Big Mac is made the same in Canada the USA and in Europe.

They sometimes offer some cost savings in the purchase of supplies and group advertising rates where you participate in advertising the chain and the chain helps you promote your individual business.

Some of the financial service franchises for example also get centralized services lie market research.

They typically charge a fixed up front fee and a percent of revenue. Terms may be limited or open-ended.

A franchise may or may not have some geographical exclusive rights.

Business development and management assistance may or may not be offered.

In my area of engineering (civil and construction) these are not services that are critical to developing a business. Name recognition is important when people are making small and repeated purchasing decisions, not when they are making large one time buys.

The way of doing business and similarity of product is also not as important in an industry where everything is a “one of” product.

Input materials and supplies are not a significant portion of my operating costs so saving 10% there is not a reason to give up some autonomy.

Business development is a direct person-to-person contact in my industry so mass advertising is not an issue.

I’d give it some critical thought. Is what they are offering worth the up front costs and on going fees for the services that they are offering?

Some industries simply do not lend themselves to the franchise method and I believe that engineering is one of them.









Rick Kitson MBA P.Eng

Construction Project Management
From conception to completion

http://www.kitsonengineering.com

 

[GregLocock]

Also bear in mind that the franchisor and franchisee do not have identical aims. Guess who has the whip hand?

As Rick says, small contract design houses seem to get work more by personal contact than being picked out of the Yellow Pages.


Cheers

Greg Locock

 

[SeanDotson]

Thanks for the input guys. I agree with some point but I can see the advantages to being part of a larger group. This particular company tends to have each office be an "expert" in one discipline or another. E.g. (mech design, piping, fire safety, thermo, power generation etc..)

So if one office gets wind or is approached for a job that is outside their realm they can refer them to the sister company. This is useful for example if office A has a wonderful client they can do more for them (by using the resources of the sister company).

The concept is sound but not sure how t works in practice. I am proceeding with caution but I am looking into this a bit more.

Again, thanks for your comments.


Sean Dotson, PE
Autodesk Inventor Certified Expert

http://www.sdotson.com

Autodesk Inventor Tutorials & More

 

[ProEDesigner00]

SeanDotson

I did some subcontracting to a division of Productive Resources. Initially the experience was very good. I worked with the fellow who "owned" the division in Kentucky. Positive and upbeat. I made some personnal blunders in the course of being involved with them and am certain that this was a part of the negativness it soon became, however there are 6 sides to a cube and so for every positive or negative there was the oposite side of the story. We did talk about my initial buy in to the situation, and soon the talk turned to well "I (this franchise owner)will fund and own majority in this new office I can help you start in your area, and let you manage and solicite accounts." I would say buyer beware. As it turns out the office this guy "owns" is an office that he is the one man band at. Secratary, mail clerk, pro-e specialist, ect.

Now I was told about this website in the last few weeks and from what I have read and seen there might be something to this pie piece that could be equitable to everyone involved. I am writting my disclaimer here that I am not trying to promote this situation just asking for others opinion.

http://www.pacepros.com/index.html

Later.

 

[bvi]

I am not familiar with the organization, but a question I would ask is how it maintains proper quality control in this arrangement.