Disrupting the status quo
Friday, October 28, 2011/
Launching a new concept in an unfamiliar industry often requires a thick skin, particularly if you plan on franchising your business from the get-go.
When 28-year-old Nathan Cuneen started his latest venture, Blow Dry Bar, doubts were raised not only about his idea but his knowledge of hairdressing.
Blow Dry Bar is a chain of express beauty salons offering a single service – blow drying – served with a glass of complimentary champagne.
There are currently 10 Blow Dry Bar salons operating in Sydney, Melbourne and Brisbane, eight of which are franchisee-owned, with another one on the way in Perth.
Employing around 90 staff, with an average of eight employees per franchise, Cuneen says revenue has “virtually doubled” in the last two and a half years.
But before Cuneen carved a lucrative niche for himself, he had to deal with unfavourable market conditions, cynical industry veterans and hostile building managers.
“I started in 2008 as soon as the global financial crisis hit. When we were negotiating the lease, Macquarie Bank said, are you sure you want to sign this lease?”
“It was a new concept – it had never been tried or tested in the southern hemisphere. They were quite reluctant.”
“I got knocked back a number of times, and so-called industry experts didn’t give me a chance at all, because I didn’t come from a hairdressing background.”
Nevertheless, Cuneen proceeded with his plan and opened his first store in Sydney’s CBD. It wasn’t long before he began building the business into a franchise.
“From the day you open your doors, you need to have in your mind that you are running a multimillion company,” he says.
“Coming from a franchise previously, I knew what it was all about being a franchisee. It was easier to move into the franchisor space because I could understand franchisee’s needs.”
While Cuneen felt comfortable moving from the role of franchisee to franchisor, he then had to deal with the many challenges associated with real estate.
“When I was dealing with landlords for franchises in CBD locations, they were quite taken aback with regard to how young I was. I had to work that little bit extra to gain their trust,” he says.
“But it was more building managers than landlords [who presented challenges]. Sometimes, I come across building managers that like to assert their authority.”
“Although we’re bound by fit-out guidelines in most premises, sometimes you feel like banging you head against a brick wall, trying to get building managers to understand what you require.”
Cuneen says conflict can occur when he’s attempting to fit out a store as quickly as possible, but there are strict rules to adhere to.
“I’m the type of manager who, when we secure a site, wants the store built tomorrow,” he says.
“At the end of the day, it costs more money if your fitters need to work overtime during the night [to avoid making noise during the day].”
“We’ve been quite lucky. With the growth of our company, a lot of contractors are wanting to get on board. It’s more about volume rather than a quick profit per site.”
Based on his own experience as a young entrepreneur in the franchising sector, Cuneen says it’s all about having confidence in your brand and educating yourself as much as possible.
“I absorbed as much as I could – I attended seminars and learned from the best. Franchising is changing all the time and you must keep on top it,” he says.