Distributor aiming to leverage brand and target customers prefering direct relationships; rules to avoid ‘cannibalising’ existing independent dealer channel
Carphone Warehouse Business (CPWB) has begun trialling a new franchise programme as it looks to add new customers and penetrate new markets.
The trial began in April, with two unnamed, self-employed partners each trading as CPWB as part of a new ‘direct’ channel.
CPWB head of partners Bob Sweetlove (pictured) will be responsible for both the direct and indirect channels. He said the programme is designed to “leverage” the Carphone brand and capture business customers who prefer to connect their phones directly, such as operators or major retailers.
“Our franchisees will operate as sole traders then grow organically as demand increases within their region,” Sweetlove said. “We would want a franchisee to be 100 per cent behind selling our brand values and proposition.”
Rules of engagement
The franchise programme will not be available to existing independent dealer partners – CPWB is aiming to keep both channels separate, it said.
Each franchisee partner will be required to sign a legal ‘partner protection clause’ agreement, meaning they cannot attempt to win business connected through an existing CPWB dealer.
Sweetlove said the project is not designed to “cannibalise” the firm’s existing dealer channel and franchise partners will not be “stepping on anyone’s shoes”.
“We guarantee not to approach existing indirect customers,” he said.
“We want to grow our base size and while we welcome any additional growth from indirect partners, we also realise that our existing partner business isn’t growing and there are customer segments we cannot reach with our indirect partner model.
“The CPWB brand gives us a presence to get in front of customers which we never had when we were HSC.
“There is currently no national brand in the market that can offer business customers the choice of all the networks under one roof.”
The trial runs until September, at which point a final decision on the model will be confirmed.
Sweetlove said if the scheme is a success, he plans to add at least 10 more franchise partners covering around 40 regions.
Franchise partners must buy all stock and process all airtime connections through CPWB as part of the deal.
Airtime includes EE, O2, Orange, T-Mobile and significantly Vodafone, which is not currently available to the indirect dealer channel.
Franchise partners will receive 50 per cent of the net margin for each successful connection.
Sweetlove said CPWB will manage “90 per cent” of the connection process, including performing the credit vet and dispatching stock and SIMs direct to the customer.
“We see it as an opportunity to find quality business individuals with a skill for networking and forging relationships in their local area,” Sweetlove said.
“If the pilot proves successful there will be a rigorous selection process for interested applicants.”
Meanwhile, CPWB launched a three-week ‘BlackBerry Summer Shopping Sensation’ incentive for dealers on June 10.
Each day, £250 worth of shopping vouchers are being given away to the dealer buying the most BlackBerry handsets online.
There is a different offer each day. On the opening day, the smartphone involved was the Q10. The black variant cost £375, while the white model cost £415.