lobby at Business Franchise

Karl Marx is dead. The inventor of communism is lying in a grave at London Highgate cemetery. But the ideas he has presented to the society are still alive and prosperous. Moreover they are taking their place today. We are turning to them today. If it is hard to you to believe me you have to read Funky Business by Kjel A. Nordstrem and Jonas Ridderstrale. You will know a lot about modern economic trends and Karl Marx. They are speaking about the value of workers and especially about the value of their brains and ideas.
They were clever guys – Karl Marx, Friedrich Engels, Vladimir Lenin, Mao, Che Gevara and all other communist leaders. They were nations’ leaders. And they knew the clue idea that people not the capital are the most important production resource.
And they knew the power of unions. It seems to me that even today we are not realizing the importance and power of united people. But those guys knew.
El pueblo unido jamas sera vencido! That is the Spanish expression that means “United people will never be defeated”. It became famous during the Cuba revolution. It’s the beginning of revolution hymn. And it had become very popular in sixties. Comandante Che was definitely right. Synergetic effect is the key.
2 + 2 = 7.
The system is much more than the sum of its elements.
And united people can reach unbelievable achievements. That is the thing that brings success to revolutions.
And that is the thing that brings success to franchises. That is an American way to unite people.
Do you need examples? I have them.
Let’s examine Holiday Inn. Good franchise system I think. Holiday Inn was recognized in 2001 by Franchise Times as a Top 100 Franchise Chain. So the system is good enough.
This chain of hotels was organized in 1952 by homebuilder Kemmons Wilson to provide inexpensive family accommodation for travelers within the USA. Its franchise system allowed Holiday Inn to grow up dramatically. By 1958 there were 50 Inns across the USA, 100 by 1959, 500 by 1964, and the 1000th Holiday Inn opened in San Antonio, Texas in 1968. The chain dominated the motel market, leveraged its innovative Holidex reservation system, put considerable financial pressure on traditional hotels, and set the standard for its competitors like Ramada Inns, Travelodge, Howard Johnson’s, and Days Inn. By 1972, when Wilson was featured on the cover of Time Magazine, there were over 1,400 Holiday Inn hotels worldwide.
Many think that the main reason of that irrepressible raise of Holiday Inn is its original creed that the properties should be standardized, clean, predictable, family-friendly, and readily accessible to road travelers. But I know one more important reason. It is the unity of the chain.
In 1955 just in three year from setting up that business Kemmons Wilson created an organization of Holiday Inn franchisees, which were charged with reviewing issues important to the Holiday Inn Hotel system. One year later it had been transformed into National Association of Holiday Inns. In 1959, it changed its name to the International Association of Holiday Inns to reflect the geographic expansion of our membership. Today, it is known as International Association of Holiday Inns Owners’ Association (IAHI).
The creation of that organization has driven Holiday Inn to its tremendous spurt.
Today the IAHI represents the interests of nearly 3,000 owners and operators of InterContinental Hotels Group (IHG) hotel brands, including:

• Crowne Plaza Hotels and Resorts
  
• Holiday Inn Hotels and Resorts
  
• Holiday Inn Express
• Staybridge Suites
• Candlewood Suites

The mission of the IAHI, as it stated on their site, is to operate an association of hotel owners and operators that create a multi-level forum for exchange of information, ideas and best practices between franchisees and IHG company executives. As a result of this process owners and operators will enhance the value of their license agreement and IHG executives will gain insight to better achieve company goals. 
The International Association of Holiday Inns Owners’ Association is focused on 3 main objectives to help promote members’ long-term interests:

• Increasing hotel revenues and market share growth.
  
• Achieving earnings before interests and taxes, operating profit, and return on investment that surpasses the competitive set for each brand.
  
• Creating long-term brand and hotel asset value through excellent brands, quality operations, superior marketing, and team member development.
  

The International Association of Holiday Inns Owners’ Association also effectively represents members’ interests to the broader hotel industry on legislative issues, along with vendors and other resources, helping to achieve the objectives outlined above.
 The organization that shares the experience, promotes franchisees, teaches them is the key factor of Holiday Inn’s success. It makes entrepreneurs feel comfortable within the franchise system. It provides a kind of support to franchisees even if it has to lobby their interests through franchisor. As a result people are willing to invest large amounts of money (Holiday Inn franchisee’s total investment differs from 1 to 10 million dollars) in this business providing it by an extremely quick development.

Yesterday I wrote an article about sources of financing for a franchisee. And an interesting thought came to my mind. I was thinking about some associations and unions and their role in economic development.
 

Just think about it a bit. Small business companies have very little power to influence the legislation of the US or any other country. Even when they understand the necessity of some changes or improvements they are too small, too busy and don’t have enough money to protect their rights. As a result, 2-5 big companies have all the possibilities to lobby legislation favorable for them. They can put into operation new tariff or promote necessary educational program.
 

The only way out for small and medium-size companies is to become organized. And we can see this in almost every country in the world. The activity of different Small Business Associations and Unions of Entrepreneurs is a great power that can be one of the guarantees that protect competition.
 

But what about franchising? Yesterday I realized that franchisee can get the benefit of lobby twice! On the one hand as a representative of small business, and on the other as a representative of Franchise Association.
 

It seems for me that I found an additional benefit of franchising!

McDonald’s is launching the first lunar franchise. At first sight it looks like a joke. Whom to serve on the Moon? How to deliver the food ingredients? Who will work there?… These and many other questions appeared in my mind immediately after I’ve read that information.
 

Certainly, they can’t consider this as a profitable project. As I understand they can’t even think about getting their investment back within the next dozens of years. But as I understand they are thinking about indirect benefits.
 

The first unquestioning benefit is promotion and advertising. That idea is enough interesting and strange for many journalists to write about it. People will discuss it too… At the same time the idea gives rise to positive emotions. Just listen to your emotional reaction when reading the following:
“The famous astronaut is lending the Moon and he has only 2 hours to meet his sweetheart. They meet at the McMoon. The stars are surrounding them. They can see the Earth through the window…A robot in a traditional uniform is serving them… ”
 OR
“A small space ship flies up to the McMoon using the special corridor. Two strange aliens are ordering 4 BigMacs and 2 Colas. It’s a “McMoon drive”…” 
Is it funny? Yes! Fantastic? Sure! But I bet that you’ve smiled while reading this. That’s what I meant while speaking about positive emotions. And what will you say about Ronald McDonald in the rocket?…
 

The second benefit for the company concerns costs. According to the official information, because of the high cost of providing living space and life support technologies, all food preparation, serving, cashier duties and maintenance will be performed by a crew of specially designed robots. And if everything works OK they will start using the same technology in some terrestrial restaurants! As a result this can help saving thousands in annual labor costs (certainly if trade unions will not lobby a law to forbid it).
 

I hope I managed to prove that this idea is not so strange and stupid as it seems from the first sight.

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