Multi-unit ownership is on the rise. The 2018 bfa NatWest Franchise Survey proves that franchisees are keen to grow their portfolios, with multi-unit ownership jumping up from 29% in 2015 to 36% in 2018. So while the number of franchise units has gone up 10% to 48,600, the number of franchisees has remained relatively consistent, at around 20,000. Why? Franchisees and clearly seeing the benefit of a career in franchising, and are not only staying in the sector, but expanding, too. And for those franchisees that wish to continue to scale up, a great opportunity to do so and learn best practice will be at Superbrand, an event held at the Institute of Engineering and Technology, London, May 16, 2019. The event will include a Franchisee Investor Zone this year, which will discuss the franchisee investor’s road to success, and how they have grown strong teams and ensured good return. Here, you can connect with like-minded multi-unit owners hungry for more.
Mike Racz, a multi-brand franchisee success story
Mike Racz went from a Domino’s delivery driver to ultimate franchisee investor in the space of 14 years. With a few months of his university degree left in his native homeland, Hungary, he decided to quit and embark on a new life in the UK, moving to England the day Hungary joined the European Union.
From nothing to everything
Once in the UK, he started working for Domino’s as a delivery driver and quickly worked his way up the ladder, learning about franchising in the process.
Just over a year later he was able to open up his own Domino’s franchise, saving up money and taking over an available territory. From here, Racz’s career within franchising has flourished. He is now a franchisee for multiple businesses including Anytime Fitness, Costa Coffee and Veeno, as well as running a couple of his own, non-franchised ventures. To manage his thriving enterprise, he created The Racz Group Ltd., based in Durham, employing close to 1,000 people, and with an annual turnover in excess of £30 million.
Here, we speak to Mike, and explore how he became a successful multi-brand franchisee and whether he ever plans to slow down…
Tell us about your franchising beginnings…
“I opened my first Domino’s in 2006, and over the years continued to add Domino’s stores to my portfolio. About three years ago I walked into Costa and it was the same story.
How did you hear about franchising?
I learnt about franchising from the franchisee of the Domino’s store I worked for in Hartlepool. I had moved up very quickly to a manager position so I had been able to gain insight in terms of business and franchising and at the time
Domino’s were still recruiting franchisees.
Has it always been an ambition to invest in multiple industries and franchise systems?
I have always been keen to become a business owner. I scaled up as it can be easy to become bored and complacent.
When you own and operate one unit and you do it really well you think, ‘can I run two? How does five look? What about 10?’ It’s almost curiosity about how far you can go and what you are capable of.
You think, ‘what if you don’t stop? What is my limit?’ If you don’t believe you’ve got a limit then you have to test the theory. So I always think, if I operated a £100bn business, could I do it? I don’t know, but I would like to try.
Someone gave me an example a long time ago that there is only one CEO of Coca Cola – why one? Probably tons of people applied, so why did that one person manage to get the job? Because along the way, others had fallen and weren’t capable of doing such a role. That was their ceiling, their limit. So I just want to know what is mine.
How do you manage such a large scale enterprise?
I guess it’s two fold.
One is that I do have a brilliant team. My head office is very close to me, very much like family. It has passion and a lot of heart and a sense that we are in it together. The core values of the business are shared. Our vision and purpose are taken very seriously.
I also like to make sure we don’t ever waste time. For instance, I don’t stress because stress doesn’t move us forwards. So simply don’t do it. I also don’t moan – I try to lead by example and get my team to do exactly the same. Just ask yourself, ‘does it help?’ If the answer is no then stop what you’re doing and focus on the solution, whatever that might be.
What is the worst piece of advice you’ve received in your career?
Actually, another piece of terrible advice revolves around exit strategies. Business gurus who advise you to have an exit strategy are fools. I don’t understand how you can build up business and have an exit strategy in place from the beginning.
Why start it in the first place? That would imply that you don’t enjoy or have passion for what you have started.
How would you define success?
Success is when you find your ‘why’. When you can answer ‘why’ it is what you are doing. Once you find your why, you find your way and your passion.
If you can be happy in what you are doing then that is success, whatever that might be. Whether that is raising children or running a business, just try to find your talent and maximise it. Figure out what is your ceiling.
What are your plans for the future?
I have aspirations to grow my main three franchises. I am also hoping to break into international markets and looking to gain a master franchise with my main franchises. It’s going to be a difficult task as I need to scale them up on an exponential level.”