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The Finn Review - Issue 11

Interview with Healthy Habits Founder, Katherine Sampson

Healthy Habits is the new kid on the block in Australia's booming retail health market.

With exceptional branding and a phenomenal amount of hard work and belief, Katherine Sampson has built a system that is on the verge of something big.

New franchisors should take a leaf out of her book - she recruits franchisees carefully, has professional and consistent branding, and her PR machine is well-oiled. Result - Healthy Habits open a new store every few weeks and get up to 50 prospective franchisees enquiring every week.

Len Ferguson spoke to Katherine recently.

LF: Hi Katherine. When did you begin franchising and how many stores do you have now?
KS: I started the business 13 years ago and rebranded the concept with a 'new look' in mid-2004 - being Healthy Habits. This new concept was launched as a franchise model in October 2004 and since then we have approved 15 franchisees and have more than 20 stores open.

LF: It looks like the business is growing really quickly - what challenges have emerged and how are you managing this growth?
KS: The only problem is the physical demands and workload of the team. We have all worked so hard over the past 16 months and we had a really well-earned rest over Christmas. Other than that it's really just the financial strain of growing a company so quickly.

LF: Now that you have your feet well and truly wet, is there anything that you would have done differently along the way?
KS: There's the old cliche "Had I known then what I know now I wouldn't have done it' however having said that I am absolutely thrilled I did do it. I have loved the journey and I wouldn't change anything. Things are going really well.

LF: Many franchisors are saying they are finding it hard to find suitable franchisees - what are you doing to keep the enquiry up to enable you to meet your expansion plans?
KS: We have been very lucky to have an exceptional calibre of applicants for Healthy Habits franchises. We get around 30-50 enquiries per week - I think it must be something to do with our branding, having a sure-fire product, and a good company ethos. We have approved 15 franchisees and we have another 5 moving through the documentation stage. Now all we need to do is find more sites for our new franchise partners!

LF: What about multi-store ownership or Master Franchisees - is this on your agenda??
KS: Absolutely. We encourage all franchise partners to consider multi-sites, however not all will be capable of running more than one store efficiently. We are always extremely up-front and open with our franchisees - we want them to succeed so this is critical. The multi-store policy is a great option for some, but it's certainly not for everyone. So we work with each franchisee to maximise their individual potential from the business.

LF: Your branding is first class and I think your website is great - how important is your brand and general image to your success?
KS: Very important. Healthy Habits was totally rebranded a little over a year ago and the new 'look and feel' has allowed us to be more recognised in a very competitive industry, and it also provides us with another competitive edge - on top of that lent by our product and business systems.

LF: Retail Leasing has had it's fair share of headlines recently. How are you finding this side of the business considering you are chasing mainly foodcourt locations?
KS: It is difficult to find locations at reasonable rentals when you want them. Patience is a virtue. We know the good sites will become available eventually, we just have to wait.

LF: How does your business model ensure your franchisees make a good return on their investment considering that leases are generally only made available for 5 or 6 years and often have a re-fit clause?
KS: Firstly we always negotiate for at least a 6 year term. As all our stores are brand new, it's highly likely that only a minor re-fit will be required after the lease is up. Healthy Habits stores generally have quite a high turnover - - we expect to exceed $17m this year.

LF: We always like to finish with the question - Who do you admire in franchising and why?.
KS: I would have to say Janine Allis from Boost Juice. She made franchising sexy for younger people. Franchising traditionally has been something that older people got into, often after receiving payouts from long term employment. The average age of our franchise partners is mid-30's