Never Had A Franchise Location Close?

The International Franchise Association has awarded Speedpro Systems, the largest sign franchisor of Canada, the Distinguished Achievement Award. Speedpro's press release elaborates:

Speedpro's success is indicated by the fact that they have never had a location close, a rarity in the franchise world, and also from their innovation enabling technology. The advancements in technology and the treatment of signage are adding enormous value to the way people approach advertising, marketing and promotions.

Franchise awards can be sold off. I once praised a VP of Franchise Development for the wonderful accolades and award that his franchise network had just won. He told me not to think too much of the award. He had purchased it as a PR maneuver. I've been suspicious of little known awards since then.

In this case the IFA is well known and the award doesn't just seem like puffery (with the exception of the word "innovation" which has no benchmarks). There are objective metrics -- "never had a location close".

Having said that, there ARE ways that a franchisor can manipulate closure statistics. When a franchise system is aggressively expanding, it is conceivable that a franchise owner can fail but that the shop is sold to another, who simply takes over say, Store #010. Still, if one has to close up shop, it's better to be able to sell one's store to try to recover start-up costs than walk away empty handed.

But even though a store number stays the same, the original franchise owner might not see a penny from selling his enterprise when he exits. The timing of the sale is something that can be manipulated by the franchiser. Did the franchiser keep Store #010 on the books for a couple years and then sell the same store to a newbie? In that way, there is no "closure" of the franchise. Store #010 is still around. And, the original owner has long been terminated without being able to resell his shop.

As Benjamin Disraeli once said, "There are three kinds of lies: lies, damned lies, and statistics." Some franchisers are no strangers to this concept.

The video interview of their franchisees and what they have to say about the system does not appear particularly news worthy. It stresses support but there is little that points to how they have strong field support compared to others.

Still, when other quick print and sign franchises are hitting upon difficulties these past years, Speedpro is worth a closer look at. They seem to be doing something right. Their company history says that the concept is designed to work in small towns, which is extremely interesting because their concept can work where work is sparse. That indicates a level of efficiency, kind of like WalMart first working in small towns.