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March 2008
Vol. 10, Issue 3, Part 2, March 2008

Publisher: Mary E. Tomzack
Editor: Lynie Arden
Assistant Editor: Vanessa Goldschneider
Design: Halit Rugova


March:
The ChangeOver Month

In this issue...

Video :
Illusions: How Do They Do It?
Click Here

Street Smarts:
Surefire Tips For Improving Your Next Franchise Convention
Industry Focus:

Annual Franchise Conventions- A Waste of Money?
Guest Column:

Best Practices in Protecting and Enforcing Trademarks, Copyrights and other Intellectual Property Interests.


Surefire Tips For Improving Your Next Franchise Convention

Want to stop wasting money and start producing results from your franchise conventions? You can avoid making costly mistakes with these tips from Rick Cornish of Flying Colors:

1. Set objectives. Use your objectives in your planning, stay focused, and always control the message.

2. Ask questions. What do I want attendees to do? What do I want my staff to do? What do I want vendors to do?

3. Follow a disciplined creative development process. Keep an open mind to new or non-traditional ideas. Bring in fresh ideas, but use a structure when brainstorming. Match the medium to the message and remember: good graphic design matters.

4. Promote early and often. Nothing else matters if they don’t come. Give them good (business) reasons to show up. Videotape your convention and start promoting next year’s convention immediately post-show.

5. Presentation matters. Learn proper mic techniques and rehearse, rehearse, rehearse. Remember, brevity is a blessing—don’t recap. Choose the right guest speaker. And please—don’t read your PowerPoint.

6. Go with the flow. Plan the rhythm of your show. Start with a strong first impression, choose the right breakout format, and build to a climax.

7. Have fun with a purpose. This isn’t a pricey party. Choose appropriate entertainment that will support your convention’s business objectives. Don’t let them forget the experience.

8. Get it right the first time. In live production, there is no second take. Every presenter should have a tech rehearsal and the tools they need.

9. Don’t skimp. Avoid the hotel A/V department. Go for quality sound, projection, and lighting. It doesn’t have to be extravagant; it does have to work.

10. Manage your budget. Look for hidden costs in hotel, speaker, and entertainment contracts. Urge all your top suppliers to sponsor meals and other needs.

Industry Focus

Annual Franchise Conventions- A Waste of Money?

The typical franchise convention is an expensive shindig, with a price tag that can easily run into six figures. So what are you getting for that money? An expensive theme party or a stronger organization? A convention is an opportunity to improve your business-something most franchise organizations fail to do according to Rick Cornish of Flying Colors, a premiere convention production company. "A franchise business needs to do two things: sell more units and make franchisees more successful. The average annual convention does neither," says Cornish.

A convention should be the centerpiece of franchisee communications, says Cornish. "You have to realize that franchisees are thinking, 'what have you done for me lately?' They feel they're out on the Russian front while the franchisor is back in the ivory tower with no clue about what's happening out in the real world. A well-planned convention can promote a greater emotional connection and turn a lot of those 'have-to's' of franchising into 'want-to's' for the franchisee."

A good place to start is to structure the convention around a specific objective that will help grow business. "For example, let's say there's a product that's being introduced and a significant percentage of the network has been slow to adopt it. First, create the message around the benefits of introducing this product and how easy it is operationally to add to existing store operations. Then make the franchisee the hero. You might say, 'meet three franchisees who have increased their same store sales by 5% by promoting this product.' A really brilliant CMO or CEO can get up on stage and talk about how great it is. But when peers gets up there and talk about how it worked in their stores, the reaction is 'gee, those guys aren't any smarter than me, they're just making more money.' Now the attending franchisees have a reason to do what they can relate to."

One reason many conventions fail is because they don't meet franchisees' expectations. "Franchisors often think it's ok to do a homemade kind of convention, but that projects an unprofessional image. An increasing number of franchisees are coming out of corporate America; they know what a good meeting looks like. When they see something that's been done on the cheap, it undermines the franchisor's credibility. The mistake is in not taking it seriously enough."

All that planning and money-how do you know if it's worth it? Find a way to measure the effect your convention has on attendees such as a survey. "We have an instrument called eMotivate, a 5-minute web-based tool that measures how franchisees are feeling on a quantitative basis. We run it prior to the convention and then again to conduct a post-convention 'post-mortem' to see where we've moved the needles. Invariably, the franchisor is surprised at some of the findings."

Contact Info:
Rick Cornish, President & Creative Director
Flying Colors
612-752-0222; rcornish@flyingcolors.biz
www.flyingcolors.biz


Best Practices in Protecting and Enforcing Trademarks, Copyrights and other Intellectual Property Interests.

By: James A. Wahl

Trademarks, copyrighted works, trade secrets and proprietary business information form the core of any franchise system, and are frequently a company’s most valuable assets. Trademarks, including service marks, logos, slogans and trade dress, define the brand identity as presented to the public. The “behind the scenes” business know-how on which the system is built and implemented by franchisees is embodied in a variety of copyrighted and proprietary works – operations manuals, proprietary processes, recipes and formulas, custom software, advertising copy to name a few.

Obtaining, maintaining and enforcing legal protections for these intellectual property interests is of critical importance to all franchise operations. Following are some best practices to maximize your legal protection.

• Register all trademarks with the US Patent and Trademark Office for all goods and services your business offers.

• Monitor your trademarks as used on the Internet, in competitors’ advertisements, in publications and other media, and take prompt enforcement action against unauthorized users.

• Register domain names for all of your trademarks, including common misspellings and variations, and register domain names if available for names describing the products and services your business offers.

• Place copyright notices on manuals, customized software and other proprietary business materials.

• File copyright registrations with the U.S. Copyright Office for important works that are likely to be copied by competitors.

• Place prominent confidentiality notices on important internal business documents, operations manuals, and other proprietary information.

• Have your key officers and employees, as well as franchisees and their managers, sign confidentiality and non-compete agreements.

• Obtain written work for hire / copyright assignment agreements from all outside firms such as software developers, consultants, advertising agencies and design firms that produce any creative works for your business.

The last point is commonly overlooked, but it is a practice that every business must take. If you adopt only one practice as a result of reading this article, it should be this. Without written work for hire / copyright assignment agreements, your business will not have ownership of the copyrights to creative works your company has hired outside firms to produce. You will instead have only limited rights to use the works, and the outside firm will retain rights to use the works for others, including your competitors.

While this is not an exhaustive list, it is a good starting point to evaluate your current procedures. Franchisors that follow these practices will have taken the basic steps needed to secure legal protection for key intellectual property assets.

Jim Wahl is the Co-Chair of the Intellectual Property and Franchise Departments at Krass Monroe, P.A., Minneapolis, Minnesota Jim represents clients in all aspects of franchise, trademark, copyright and trade secret law, including trademark evaluation and clearance, branding issues, registration of trademarks and copyrights, franchising, licensing, technology, computer software, and enforcement of trademark, copyright, trade secret and related intellectual property rights. He has been recognized as a “Minnesota Super Lawyer” by Minnesota Law & Politics and a “Legal Eagle” by Franchise Times. He can be reached at 952-885-5991 or jwahl@krassmonroe.com.

Popeyes Founder Al Copeland Passes Away

Al Copeland, founder of the Popeyes Chicken & Biscuits and Copeland's of New Orleans chains, died this month at the age of 64 at a clinic in Germany, where he was being treated for cancer of the salivary gland. A flamboyant figure who also supplied spice mixes to the restaurant industry through his Diversified Foods & Seasoning company, Copeland established the spicy, Cajun-style chicken of Popeyes as a local favorite before turning it into a sizeable franchise chain with national ambitions.

Copeland eventually lost ownership of the brand after buying a rival operation, Church's Chicken. A successor company, now known as AFC Enterprises, eventually sold Church's. AFC still operates and franchises Popeyes which has grown to 1,905 restaurants. Copeland later shifted his attention to his dinnerhouse operations, including Copeland's of New Orleans. He also experimented with a full-service concept called Straya, a local favorite in New Orleans for a number of years. (Nation's Restaurant News, 3/24/08)

Franchises Show Resiliency in Slowing Economy

Despite a rocky market, franchise businesses continue to perform well, according to a recent Pricewaterhouse-Coopers study on growth of such businesses nationwide. The study researched 5,940 franchise businesses in operation, generating revenue of $5.3 billion and employing 79,800. Owners and industry experts expect growth this year for the franchise industry even as the economy slows. In past recessions, the franchise industry has seen an uptick in franchise sales. During these periods, franchises survive mainly on brand recognition, reliable systems, and growth. The report concluded that the franchise industry, valued at $880 billion, had annual revenue increases of 9 percent from 2001 to 2005. (Toledoblade.com, 3/20/08)

KFC Eyes Name Change to Include 'Grilled'

In a potential departure from its long heritage, KFC Corp. will give franchisees the option of rebranding their stores "Kentucky Fried & Grilled Chicken" as part of the scheduled rollout of a nonfried product now in widespread tests. The revised moniker already is being used on store facades during tests at what is believed to be hundreds of units in Colorado Springs, Colo.; San Diego; Oklahoma City; Jacksonville, Fla.; and Austin, Texas.

After failing repeatedly for more than a decade to find a following for nonfried chicken offerings, the struggling division of Yum! Brands Inc. is pinning its hopes for success this time in part on high-volume cooking gear that would be deployed to all domestic stores by next spring. KFC is marketing the new product as grilled, but the chicken is actually roasted in an automated, high-temperature convection oven. The cooking process is designed to yield tastier, juicier chicken. The Kentucky Grilled Chicken product, depending on the part of chicken, has as much as 50 percent fewer calories and half the sodium, and up to two-thirds less fat than KFC's fried chicken. (Nation's Restaurant News, 3/21/08)

Motel 6 Unveils New "Phoenix" Prototype

Motel 6, known for offering a clean, comfortable room for a low price, is reinventing the economy lodging experience with the announcement of its first new prototype in 12 years. Accor North America, one of the nation's largest hotel owner/operators and the parent company of Motel 6, will unveil the Motel 6 "Phoenix" prototype this month. Major features of the Phoenix prototype include a new building exterior, a spacious lobby with a new 24-hour food and beverage vending market place, and a modern guestroom design that features bright accent colors. The room includes ambient lighting, wood-effect flooring rather than carpet, a 32-inch flat-screen TV and a pedestal bed with a new taupe-colored coverlet and pillow-top platform mattress.

The first Phoenix prototype will be a corporate-owned location and construction will begin in the latter half of 2008. The new prototype will be available to franchisees in the summer of 2009. Future plans call for many current Motel 6 corporate properties to be retrofitted with elements of the new prototype. (Hotels Magazine, 3/11/08)

Mama Fu's Bought by Franchisee

The top franchisee of Mama Fu's Asian House has bought the Pan-Asian fast-casual restaurant brand in the United States and Mexico markets for an undisclosed sum from Atlanta-based Mama Fu's Noodle House. Austin, Texas based Murphy Adams Restaurant Group, the largest franchisee of Mama Fu's, now has 17 Mama Fu's restaurants in the United States. Adams already owned five and had a sixth in development before the deal. And now, the company also has the rights to future Mama Fu's restaurants in Mexico.

Mama Fu's was started in 2003 by Atlanta-based Raving Brands Inc. In 2006, 40 Mama Fu's Asian House franchisees and investors sued the fast-casual franchising company and its founder, Martin Sprock, alleging fraud and breach of contract. According to a spokesperson for Mama Fu's, Murphy Adams Restaurants Group would not inherit any liabilities from the suits. (Atlanta Business Chronicle, 3/12/08)

Pizza Hut to Start Delivering Pasta

Pizza Hut said it would start delivering family-sized servings of pasta entrees systemwide on April 6. Two delivery pasta choices will be offered: creamy chicken alfredo and meat marinara. Each is priced at $11.95, which is the same price of a large pizza with one topping. Delivered in pans, each order feeds six people and comes with five breadsticks. Franchisor Pizza Hut Inc. said the new delivery options would not require more equipment for stores or delivery people. The pasta will be supplied to locations frozen and baked in the units' pizza ovens. The delivery pouches used for pizzas will also be used for the trays of pasta, and the aluminum pans can be reheated. Pizza Hut consists of 6,200 restaurants in the United States, with 4,000 more operating in 100 other nations. (Nation's Restaurant News, 3/25/08)








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