5/22/2008 10:03:00 AM
Fonehouse to launch franchising business
Fonehouse has been given the green light from T-Mobile to launch a franchising business, which will see 35 dealers rebranded to Fonehouse by the end of the year. Another 40 have been earmarked for 2009.
Approximately eight dealers have already agreed terms in recent weeks, with Fonehouse looking to recruit more and compete head-to-head with distributors.
Fonehouse was one of the three former T-Mobile solus dealers, and the franchisees will add to Fonehouse’s existing estate of 17 stores, mainly in the South-East.
It is another blow for airtime distributors who have seen their market contract to a quarter of the size in the last 12 months. It also follows news that T-Mobile will target the best dealers directly.
Fonehouse MD Clive Bayley told Mobile: ‘Franchises will look and feel like a Fonehouse store – the same signage, point of sale, Epos system, and our buyers’ guide.’
Dealers are being tempted with better stock allocation and deals on a par with Carphone Warehouse, Phones 4u and T-Mobile’s direct offers.
One senior distribution source summed up frustration among distributors regarding the Fonehouse deal: ‘There’s too much smoke and mirrors at the moment - do they want consumer connections through distribution, or not? It’s sub-dealing on a massive scale.’
Franchisees will be offered preferential T-Mobile stock, and stores will be weighted 80% towards T-Mobile, with Orange contracts representing the remainder.
Bayley said the model for the business, which started 14 years ago, is built on retention, with parity on commissions for new connections and upgrades.
Area managers, mystery shops and a ‘strict’ auditing service will all be used to make sure that franchisees comply with the brand and ethos.
‘This is not sub-dealing, but introducing a more professional retail environment for high-quality dealers,’ Bayley added.
Several new faces have been recruited by Fonehouse including ex-Chitter Chatter employee Stuart Ferguson as head of retail, former T-Mobile head of logistics Keith Lewis as operations consultant, and former Hugh Symons Communications employee Andy Lockwood as business development manager.
Dan Schama, who has run one of Fonehouse’s pilot stores since November 2007, has taken on the role of commercial manager of the partner programme.