Get Your Salon Found With a Compelling Web Presence

Get Your Salon Found With a Compelling Web PresenceIt’s 2015, and if your spa or salon doesn’t yet have a web presence, you’re missing out on a lot of business. For whatever reason, salon owners and hairstylists are some of the last holdouts when it comes to creating a website for their businesses. Perhaps the concept of connecting online feels a bit foreign to those used to getting up close and personal with their customers. Like it or not, however, the Internet is here to stay, and online is where your would-be clients are searching for you. To operate without a website is like not having a sign in front of your establishment.

Like a business card, your website is often the first impression your customers will have of your business, and first impressions are lasting ones. It’s also where your clients can turn for information, such as your name, address and phone number. A website goes much, much further, however, in that it can provide information about your products and services, hours of operation, staff, prices, specials and specialties, and can even be used to make appointments.

Can I Build My Own Website?

Yes you can! Building a website for your local business doesn’t have to be difficult or expensive. There are many DIY sites that feature easy to use, intuitive software that requires little to no tech-savvy on your part. If you start with a hosting service such as Bluehost or GoDaddy, the basic package includes a choice of several different software programs at no extra charge, or alternatively, you can start with a software program, such as Weebly, Wix, Google Sites, DoodleKit, WordPress or MoonFruit, and choose your hosting partner through them. Most include a free version that includes up to five pages, which can always be upgraded later.

WordPress offers a wide variety of themes, including some that are specifically designed for spas and salons, and there are even more (many, many more) WordPress themes available for free and for purchase from different sites all over the Internet. Browsing through some of them on a site like ATheme is a great way to find inspiration.

Salon Marketing Whitepaper

Considerations for a Well Designed Website

Your website should reflect your business. Think of it as your lobby, where visitors can wander in off the street and see what you’re all about. You want it to be warm and welcoming, and aesthetically pleasing. Just as you wouldn’t clutter your countertops and your waiting area with superfluous products and equipment, nor should you clutter your website with irrelevant information. Your name, logo, address and phone number should be prominently featured so your customers can easily find it. Use a balanced combination of graphics, images and text, and resist the temptation to include flashy animations that will make the site take longer to load.

Keep it Consistent

Consistency is key when building an Internet presence. Your name, address and phone number (NAP) should be written exactly the same way each and every time it’s posted, on each page of your site, in every directory where you list your business, on your blog, your social media pages, your newsletter. Keep your spellings, abbreviations, suite numbers, etc. consistent from site to site and Google’s web-bots will have a much easier time indexing and linking your sites.

Develop a theme for your business with consistent colors, fonts and images, so that your brand will be easily recognized. Get a professional photo taken of your storefront to use on your website as well as your Yelp page, Google Plus, Yahoo Local and other listings. This will help your customers to recognize your business when they arrive for their first appointment.

Use Pleasing Images

Many website themes and templates come with pre-placed images relating to spas and hair and nail salons, and there is also quite a lot of clip-art available from various sites on the Internet, many of which are free to use or may be purchased for a small fee. Your website, however, should reflect your business, so unique and attractive photos taken in your own establishment will help to make your customers feel at home while portraying your salon in a pleasing light. You may want to hire a professional if you’re not terribly proficient with a camera. Choose a time of day (or night) when the lighting is soft, and clear away any background clutter. And be sure to include lots of smiling faces in your photos, even if they’re only of your staff.

Consider posting some before and after makeovers of clientele on one of your pages, along with customer testimonials and reviews. Use photos to illustrate specialties, such as bobs, perms, highlights and hair straightening treatments. When it comes to salon marketing, photographs are a powerful tool.

Include a Blog Page

Too many local business owners build a website and then forget about it. Remember, search engines favor websites that are dynamic and frequently updated. The easiest way to keep your website fresh is to include a blog and post regularly. Use it to promote the latest specials, introduce new products and services and provide helpful home care and styling tips for your customers in order to build trust and goodwill. Link your blog to your social media pages by posting an update to Facebook and Twitter each time you create a new blog post.

Optimize Your Website for Mobile

Many (if not most) of your customers are finding you on smart phones and tablets these days, so make sure your site is optimized for those devices. Most of the DIY website software will do so automatically but it’s worth verifying before signing up. A website that’s not optimized for mobile will be difficult to read on a small screen like a smart phone and could even get penalized in mobile searches. To make sure your efforts have not been in vain, Google rolled out a new web tool that allows you to determine whether or not your website is “mobile friendly.”

With all of the directories, mapping programs and review sites on the Internet these days, it may be tempting to forego the effort and expense of building a dedicated website for your salon or spa, but don’t. Having a well-designed, professional-looking website not only validates your salon as a modern, professional operation, but it’s an important part of the overall picture. Your website provides the anchor for all of your directory listings, reviews and various citations throughout the World Wide Web that together establishes your Internet presence so that your customers can find you in 2015.

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Starting a Franchise: Are You Ready to Be a Franchise Owner?

Are You Ready to Be a Franchise Owner?Starting up a new business is always a risky proposition, but some of the risk can be mitigated by buying into a franchise. A franchisor is someone who has already taken the risk and put in the time and effort to build a wildly successful business, and is willing to let you capitalize off of that success — for a fee.

The main benefit of buying into a franchise is a ready-made game plan. You receive a name, logo, décor, products or menu, suppliers and promotional materials. Best of all, built-in customers that are already familiar with the business and ready to buy. There is little decision-making involved when it comes to setting up your business, and you can start raking in the profits much more quickly than you would when starting from scratch.

The down side is that you have little artistic freedom. Most franchises have a strict set of rules to be followed, governing everything from operating hours, employee uniforms and menu selections to product suppliers and contract service providers. You may be locked down to paying premium prices for these products and services rather than shopping around for a better deal. On top of that, there’s the initial franchise fee, plus regular royalties to be paid to the franchisor, which will certainly eat up some of your profit.

Are You Ready to be a Business Owner?

Although the risk is lower and the decisions fewer, owning a franchise is still tantamount to owning your own business. And while there are many rewards to being your own boss, there is also a lot of risk, hard work and responsibility involved. As a small business owner you have none of the security of being an employee; no steady paycheck, no guaranteed time off and benefits. You carry tremendous legal obligations and liabilities. As a business owner, setting your own hours may mean working many more hours than you did as an employee, especially in the early years of building the business. You need to be motivated, independent and ready to take on a lot of hard work, challenges and financial risk.

Do You Have the Financial Resources?

Depending on the franchise, the initial franchise fee can be anywhere from $20,000 to upwards of $100,000, and that’s just for the license. On top of that you’ll need start-up costs; everything from a lease, equipment and uniforms to security deposits and inventory. Your franchisor may be willing to finance the initial fee, and you may be able to get a small business loan to help with the start-up costs, but it’s important to do a realistic assessment of your net worth before you get started. Most franchises have a minimum net worth requirement – and you’ll need the information to apply for a small business loan. To determine your net worth, simply add up all of your assets and then subtract your liabilities. The remaining figure is your net worth.

Assets – Liabilities = Net Worth

Selecting a Franchise

You may already have a franchise in mind; perhaps that corner donut shop that always has a line down the street, or your favorite yoga studio or novelty store. It certainly helps if it’s a product or brand that you’re already familiar with and enthusiastic about but you need to make sure it will be as popular in the location that you’ve selected. The ice cream shop that’s wildly popular at the boardwalk in the summer time may not do as well in a less touristy location or a cooler climate. Remember, there are two factors to the success of a franchise; the product and the location.

Do Careful Research

No matter what franchise opportunity you plan on pursuing, it’s important to do careful research before shelling out your hard-earned money. Don’t fall for the glossy brochure, charts, and financial statements provided by the franchisor; figures can be manipulated in any number of ways. Your best bet is to talk with other franchisees. They’ll not only give you first-hand information on what kind of experience they’ve had, but can also help you avoid unforeseen pitfalls that they may have encountered.

Peruse (in case you didn’t know, means read carefully!) the franchise rules to find out how much creative control the franchisor will retain over your operation, and decide whether or not you can live with that amount of governance. Starting a franchise, you’re expecting to be in business for many years to come, so if you have particular ambitions and creative ideas you’re longing to explore, a franchise may not be for you.

Get Expert Legal Advice

This is not a decision to make without sound legal advice. Don’t sign any agreements without having them looked over by an attorney with franchise experience. Find out what your rights are with regard to contract terms and renewals. More than a few unlucky franchisees have put years of effort into building up their business only to have the franchisor decide not to renew their agreement in favor of a competing location, leaving them high and dry with a non-compete clause.

Operating a franchise can be a fast-track to independence and small business ownership. It can be exciting, rewarding, and highly profitable. It can also be terrifying, frustrating, and disappointing for those who are not up to the challenge, or who fail to put enough time and effort into selecting the best opportunity. Like everything else, you get out of it what you put into it.

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Signpost’s CEO on This Week in Startups with Jason Calacanis

Veteran tech industry titans and early stage entrepreneurs know to tune into This Week in Startups for smart advice and the latest bleeding edge news from Silicon Valley.

Signpost’s CEO Stuart Wall recently joined host Jason Calacanis to talk about our company’s growth and why he’s bullish on Main Street tech in 2015.

For more insight into Signpost’s breakout 2014, and why Jason is more excited than ever about being an investor watch the full episode now!

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The Joint Employer Fight Comes to the Massage Industry

The Joint Employer Fight Comes to the Massage IndustryThe battle continues to heat up between the National Labor Relations Board (NLRB) and the judicial system in the State of California, which recently ruled that the franchisor Massage Envy is not the employer of massage therapists in its independently-owned franchises. As a result of the ruling, only the franchisees could be held responsible for alleged wage violations in their establishments.

The ruling would appear to go against recent moves by the NLRB general counsel to broaden the definition of joint employer to include brand companies and their local franchise owners, specifically in the case of the McDonald’s Corporation. In a controversial ruling in July 2014, the NLRB deemed McDonald’s a joint employer in complaints lodged against franchisees. In December, the NLRB reinforced its decision by issuing complaints against McDonald’s corporate and McDonald’s franchisees as joint employers in 86 alleged labor violations.

Domino’s Pizza not Liable

The judicial system, however, continues to uphold a long standing opinion that franchisors cannot be held responsible for misconduct at franchised locations unless it can be proved that the franchisors were somehow involved in the employment practices. The California Supreme Court, in late August of 2014, declined to hold Domino’s Pizza, LLC jointly liable in a sexual harassment case brought against one of its franchisees.

The decision in the Domino’s case left a small amount of hedge room, stating, “[We do not] mean to imply that franchisors, including those of immense size, can never be held accountable for sexual harassment at a franchised location.”

IFA Speaks Out

The International Franchise Association (IFA) has come out squarely on the side of the judicial system, against the NLRB rulings, saying “Should brand companies and local franchise owners be considered joint employers, it will substantially impact growth and job creation in what promises to be the fastest growing business sector in the US economy.”

Despite IFA and franchise industry requests for the NLRB to provide further explanation of its joint employer decisions in the McDonald’s rulings, the Board has declined to do so. Therefore it’s difficult to ascertain whether more franchises could be affected by the decision, or whether it remains specific to the McDonald’s Corporation.

Although the battleground, so far, appears to be in California, we could soon see cases cropping up all over the nation, and no one is certain how those courts will respond. One thing is clear, however: the future of the franchise industry could rest squarely on the outcome of this deepening legal divide.

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5 Ways to Build Your Brand and Stand Out Among Local Businesses

5 Ways to Build Your Brand and Stand Out Among Local BusinessesYou may not have the powerhouse media department or the billion-dollar marketing budget of a major national brand, but even as a small local business, you can build your brand and have it stand out in your community without breaking the bank. It just takes a little effort, a little discipline, and 100 percent dedication to and enthusiasm for your business. With that in mind, here are five ways to help your local business stand out.

1. Select the perfect name and logo for your business.

It’s important that you get it right the first time because making changes down the road can cost you money and business. This is not a task you want to rush through. Your name and logo are the face of your business, and convey your values, your culture, and what you’re all about. The name should reflect the personality and overall tone of your business, and your logo should be distinctive and instantly recognizable.

In developing a logo, you’ll also want to further define your brand using typefaces, colors, imagery and design. Do you want your brand to have an avant garde, modern sort of feel, or do you want to appeal to your customers’ sense of nostalgia with more of a retro appearance? One of the most important things to do when getting ready to build your brand is to define it, based on the products and services you provide, what your values are and who you anticipate your customer base to be. The more clearly you can understand your brand, the more easily you can make it stand out.

Let this carry over to your website design as well. In a recent survey, 48 percent of people cited a website’s design as being the major factor in determining credibility, and 94 percent said it was a reason for them to mistrust or reject a site. Make sure your website is well designed and aesthetically pleasing, and reflects the character of your business.

2. Maintain a physical presence.

Ideally, you’d like for your business to be able to run itself, but let’s face it, it’s your business and you’re its most loyal and enthusiastic advocate. Let your customers get to know the face behind the business so that they get the full enjoyment of doing business with a local enterprise. Sure, you’ll want to get away once in a while, but enterprises with absentee business-owners often quickly fail, as employees lose motivation and customer service goes by the wayside.

3. Give away promotional products.

No one’s better at this than takeout restaurants, who give out refrigerator magnets with their phone number. You’re hungry, can’t find anything in the fridge — hey, how about a pizza or some Chinese food? Anything that serves a purpose can be imprinted with your name, logo and contact information so that your business is always top of mind, from pens and note pads to hats, clothing, keychains and beer koozies. In a recent study conducted by MarketingSherpa, 76 percent of participating consumers reported being able to remember the name of a business from which they had received a free promotional item in the past 12 months, while only 53 percent could recall a print or television ad from the past 30 days. In a similar study conducted by the Advertising Specialty Institute, 57 percent of people reported feeling more favorable about a business from which they had received a free tee-shirt. Keep in mind, however, that many customers won’t wear a hat or tee shirt unless it’s attractive, so either invest in quality clothing items or stick to the pens and key-chains.

4. Be a part of your local community.

As a local business, your customers are also your neighbors, and part of your local community. Build trust and respect for your business by establishing yourself as an active and engaged member of your community. You can do this by participating in local civic and volunteer organizations, hosting charity events and fundraisers, and even hosting workshops to share (and highlight) your expertise in your industry. And don’t forget about your online community, to which you can connect through social media, chat groups and forums. The more you establish yourself as a subject matter expert, the more recognition you will build for your brand.

5. Stand out and excel.  

First of all, if you don’t have a great product or service, no amount of advertising and brand building is going to keep customers coming back after a bad experience. The first step is to ensure that you’re offering real value, top quality products and reliable service. That said, the next step is to differentiate your business from the competition. To do this, you need to leverage any unique qualities that will appeal to your customers and distance you from the pack. Whether it’s:

  • Convenient hours
  • Competitive pricing
  • Reliability
  • Location
  • Enthusiasm

Or some kind of unusual product or service, you need to find a selling point or two to focus on and make it the center of your marketing campaign. Customers remember the business that stands out, whether it’s because they’re open 24 hours or the owner says he’ll “eat a bug” if they can’t give you the best deal. It works!

Remember, as a local business, you don’t have to compete against the national brands. There are plenty of customers out there who trust and rely on local business owners and prefer them to faceless corporations with automated call centers instead of genuine sales people. You only have to compete against the other local business owners in your field, and make sure that when it comes time to purchase, it’s your name, your logo and your business reputation that first comes to mind.

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13 Things that Inevitably Happen When You Start Working at Signpost

Working at a start-up is different than a traditional office atmosphere. Waay different. Suits & ties are exchanged for Bahama Tees and cargo shorts (but not really), earphones are replaced by communal music (DJ’s always welcome), and Mondays around the water cooler turn into hang-outs by the keg.

Signpost is no different – and after an extensive poll of our incredible office managers in Austin, Denver and New York, we’ve narrowed down 13 things that makes a Signposter, well a Signposter.

1. You use the word ‘Impact’ in every other sentence

what-did-you-say

We all have an impact every day and sometimes, you’ll find yourself using ‘Impact’ as a filler word like ‘uhm’ and ‘hmm.’

2. You tell your friends to choose small local businesses when they shop

Is this chicken local?

And lecture them about the reasons why they should if they don’t.

3. You are amazed by how much work you can do with music that belongs in a night club

Who knew ‘Animals’ (by Martin Garrix) was such a good song to make calls and write emails.

4. You always want to win even if there’s no competition

challenge accepted

You can make a competition out of anything and that crazy drive to win can spill into your interactions outside of the office.

5. You start the year without shaving

Manuary

Move over Movember, at Signpost we’re all about Manuary. Halfway through this year’s annual Manuary fundraiser and we’ve already passed the $6,000 mark in donations! That’s a lot of hair.

6. You have experienced different office space as the company grows quickly

Signpost Office

At least you’ll master the art of making new friends! Oh wait…still the same people.

7. Your favorite clothing brand is Max the Mole

maxmodel

Nordstrom super-saver deal going on? Kenneth Cole? No thanks, I got Max the Mole.

8. Your middle name is Coffee and Seltzer

You can call me Seltzer…Coffee Seltzer. And you know to grab extra packs of Hazelnut when re-stock day comes around.

9. You can help anybody to get found

haystack

You’ve spent so much time helping local businesses get found, you’ve mastered the art of finding the needle in the haystack – on multiple occasions.

10. You have preferred ping pong paddle and go-to partner for doubles

doubles

Doubles? Doubles.

11. You know new hires by their lack of a GIF game

Oh, no gif in your email reply? You must be new here.

12. You high-five so much your hands are numb

Whenever a sale is made, you tense in anticipation of the incoming high-fives – in the best way possible.

13. You love it here

Max

Cause at the end of the day, we’re all here for one reason – to empower local businesses to be the best they can be and have fun in the process.

 

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Don’t Count Out Yahoo Yet, Search Engine Takes Largest Share of Search Pie Since 2009

Yahoo Search Takes Largest Share of Search Pie Since 2009In an unprecedented shakeup in the search engine market long dominated by Google, rival Yahoo recently gained significant share in the U.S. search market, jumping from 8.6 percent in November to 10.4 percent in December. According to StatCounter, a large Web traffic analytics firm, this is the highest share Yahoo has seen since 2009.

The bite came directly out of Google’s market share, which dropped from 77.3 percent to 75.2 percent, its lowest since 2008, when StatCounter first started tracking global search statistics. Who or what is responsible for this slight but significant shift of power? The credit or the blame, depending on one’s perspective, rests squarely on the shoulders of Mozilla’s Firefox.

Killa Mozilla Comes Out Swinging

Headquartered in Mountain View, California, Mozilla Corporation launched its free, open source browser Firefox in 2002, and in 2004, signed a deal with Google to use the search engine as the default for searches on the browser. And now, in late November, Mozilla announced a five-year partnership with Yahoo as the new default search engine for the U.S. market.

Citing a new, more localized approach to search, Mozilla CEO Chris Beard said, “We are ending our practice of having a single global default search provider.” In the U.S., Yahoo has replaced Google as the new default search engine in Firefox, in Russia Yandex Search, and in China Baidu is the default option. “We are adopting a more local and flexible approach to increase choice and innovation on the Web, with new and expanded search partnerships by country,” explained Beard. Google and other search engines are still built in as options in these markets.

Firefox versus Google Chrome

Many in the industry are wondering whether the switch will help or hurt the Firefox browser, whose users represented just over 12 percent of U.S. Internet usage in December. Since its release in 2008, Google’s Chrome freeware web browser has taken off like wildfire, with an estimated 51% worldwide usage share of web browsers as of January of 2015. By all estimates it is the most widely used web browser in the world.

If Chrome continues to expand its market share and squeeze out Firefox, then Yahoo’s recent gains could fall by the wayside. A lot will depend on Mozilla’s revamp of Firefox, and whether or not users are happy with the Yahoo search engine.

“I doubt Google needs to worry,” said Danny Sullivan, founding editor of Marketing Land & Search Engine Land. “For one, that’s probably the high water mark. Unless Firefox suddenly grows share, everyone who likely could get switched has been now. And Google might claw back even the small share gone.”

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NY Letter Grades Not Just for Restaurants Anymore

NY Letter Grades Not Just for Restaurants AnymoreHair and nail salons in New York City may soon be posting more than just daily specials in their windows. As part of a newly proposed city ordinance, nail salons, beauty salons, and barber shops could receive letter grades based on the level of sanitation practiced in their establishments, similar to the letter grading system used at restaurants in NYC and other cities across the nation.

Citing a recent study that found customers and technicians are routinely exposed to severe toxins, bacteria, and nail lamps which can lead to numerous health problems including staph infection, skin cancer, respiratory issues, and hepatitis, Councilman Raphael Espinal and Bronx Borough President Ruben Diaz, Jr. introduced the legislation to allow the city to set up and enforce the grading system above and beyond existing state requirements.

Nail and hair salons in New York are currently required to be licensed and regulated by the state, which has just 27 inspectors. With New York City alone housing over 2,000 licensed nail care salons, and many more thousands of beauty salons and barber shops, it is an impossibility to regulate with the current number of inspectors.

Restaurant Ratings Reduce Emergency Room Visits

The proposed grading system will mirror the Health Department’s oversight of NYC eateries, which was first introduced in 2010, requiring restaurants to post their A, B or C grade prominently in their windows. It is not yet clear how much violations could cost salons; fines imposed for restaurant violations in the city range from $200 for minor offenses to $2,000 for severe infractions. According to city health officials, emergency room visits involving food poisoning dropped after the system was adopted.

Increased Scrutiny of Salons Nationwide

While assigning letter grades to hair and nail salons is a new concept in the nation, other cities have been working diligently to crack down on unsanitary salon practices, particularly in nail salons. In 2011, the San Francisco Board of Supervisors’ Public Safety Committee passed the Healthy Nail Salon Recognition ordinance, promoting not only stricter sanitation standards but also the use of environmentally friendly, non-toxic products. Earlier the same year, the Boston Public Health Commission enacted new regulations setting strict cleanliness and sanitation standards for nail salons within the city limits.

Customer Bill of Rights

With the advent of “nail art,” nail care has become a major industry in recent years. On average, women spent $204 for salon services in 2012, according to NPD Group, Inc. As the industry grows, so do the number of reports of unsanitary practices, often leading to the transmission of nail fungus and hepatitis. Without proper ventilation, toxic chemicals used in many salons can lead to respiratory issues and even cancer. The proposed NYC legislation would require periodic retraining of licensed practitioners and provide for more inspectors to monitor these businesses. Customers would be provided a “bill of rights,” entitling them to ask for better ventilation, tool sterilization and use of new files and buffers.

A survey of local business owners found that most did not object to the new proposed standards. In fact, establishments most likely to be affected by this legislation are the unlicensed salons operating under marginal conditions. By far the most common complaint received by the state’s licensing agency in recent years has been that of unlicensed operators. So if your establishment is licensed, sanitary, and environmentally-conscious, proudly display that A on your windows to let inquiring customers know your high health standards.

Interested in learning how to promote your salon? Check out our post on ‘12 Tips for Salon Marketing‘.

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Signpost on the 2015 Forbes America’s Most Promising Companies List

Screen shot 2014-01-24 at 3.15.17 PM

Forbes just published their list with America’s Most Promising Companies. We’re proud to say that Signpost has made the list once again at #94 after also being part of it in 2014.

As a recap, this annual list reviews and ranks high-growth, privately-held companies with under $250 million in annual revenue. The methodology according to Forbes:

Though we prize growth numbers on our Most Promising list, top line doesn’t say everything. We want sustainable growth, so we strive to take a holistic gauge of the companies that apply. Over the course of four months we reviewed hundreds of applications from businesses across the country. The final assessment is based on growth (both in sales and hiring), quality of management team and investors, margins, market size and key partnerships.

Joining the ranks of such high growth startups like Instacart, Slack and Box as well as close-to-our-heart local franchises such as Pizza Studio and 9Round, we are grateful and honored by this achievement.

Continuing the trend of accomplishments from last year, this marks the beginning of a great 2015 and we look forward to maintaining the trend in the year to come! #SignpostWins

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Minimum Wage, Obamacare and Franchises

Minimum Wage, Obamacare and Franchises

This is Part 3 of our three-part series around the future of the franchise industry in 2015. As previously stated and predicted in the International Franchise Association’s annual report, the future of franchising looks rosy for 2015, if you overlook a few key issues that could potentially turn the industry on its ear. Along with the NLRB’s recent decision to classify McDonald’s as a “joint employer” in a number of cases involving franchisees of the fast food giant, the franchise industry also faces serious issues involving employee minimum wages and the definition of a full time employee under the Affordable Care Act.

Raising the Minimum Wage Bar

Any proposals to raise the federal minimum wage are generally met with a great gnashing of teeth and tempestuous political firefights. Consequently, a number of states have elected to raise the minimum wage state-wide — 29 of them, to be precise, to something higher than the federally mandated hourly rate of $7.25, last set in 2009.

With many franchise operations depending on low-cost, entry-level labor, minimum wage rate increases can arguably put a strain on their margins, after paying hefty franchise fees in addition to general operating and overhead costs. One case in particular, though, has served to pit the IFA against the Service Employees International Union (SEIU) and certain civic leaders in the City of Seattle.

Seattle’s new minimum wage law requires small businesses to raise their minimum wage to $15 within the next seven years, and large businesses with 300 employees or more to do so within three. Although the legislation itself is not popular with Seattle’s franchise owners, the real slap in the face is that the law treats all franchise operations, regardless of the number of employees, as large businesses, giving them just three years to comply.

Economically Extractive, Civically Corrosive and Culturally Dilutive

The IFA claims that the new legislation is a blatant move on the part of anti-franchise members of the Mayor’s minimum wage committee to drive franchises out of town. In an injunction filed to block portions of the bill, the IFA argued that the legislation was part of a move by the SEIU and Seattle city leaders to “break the franchise model.” Billionaire venture capitalist and minimum wage committee member Nick Hanauer was quoted in an email as saying, “The truth is that franchises like subway [sic] and McDonalds really are not very good for our local economy. They are economically extractive, civically corrosive and culturally dilutive.”

IFA President Steve Caldeira, however, focuses blame on the SEIU, saying, “The SEIU’s concern is not for the employees working at franchise businesses, but the union’s real mission is to force these hard-working employees to join the SEIU’s dwindling membership ranks in order to get dues deducted from their paychecks.”

In any case, it appears that current and prospective franchise owners will have to budget for higher labor costs in 2015 and beyond.

Defining a Full Time Employee

Equally controversial as the issue of minimum wage is the definition of full time worker, especially when it comes to requiring employers to provide benefits like health care insurance to their workers. Thus when the Affordable Care Act (ACA) redefined the concept of full time from the industry standard of 40 hours per week to a lower standard of 30, it understandably caused quite a lot of consternation amongst employers, including those in the franchise industry.

The new definition appears to have hurt part-time employees, the most vulnerable Americans, many of whom have had their hours cut in order to avoid the 30-hour threshold. In response, the House recently passed the Save American Workers Act, to reform the definition of full time employee in the ACA to 40 hours per week. Companion legislation has also been introduced in the Senate with bipartisan support.

Calling it “one of the year’s key votes,” IFA President Steve Caldeira said, “We applaud the House for passing legislation that is a win-win for both employees and employers. Restoring the 40-hour work week definition is a common-sense legislative fix to the Affordable Care Act that will put more money in the pockets of hard-working Americans and allow small businesses the flexibility they need to manage their workforce.”

Whether the legislation will make it past a presidential veto, however, remains to be seen.

How these issues will affect anyone starting a franchise or owning a franchise in 2015 are anyone’s guess. They could result in anything from minor setbacks to serious repercussions. The variables are many and the arguments fierce on both sides of the coin. All we can do is wait and watch.

If you missed the overview, you can read part 1 here of the forecast of the franchise industry in 2015, and if you would like more in-depth information regarding the ‘Joint Employer’ ruling, you can read part 2 here.

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