Franchise Brands plc Annual Report and Accounts 2018 17 Financial Statements Strategic Report Governance Franchise Brands plc acquired Metro Rod in April 2017. How would you describe the journey so far? The pace of change has been phenomenal and the business is already transformed from two years ago, with so much more to come. I’ve been with Metro Rod since 2003 as Commercial Director before being asked by Franchise Brands to take over as MD. It was a frustrating time as Metro Rod was run by previous owners as a drainage, rather than a franchise business, and the franchisees were treated as sub-contractors rather than our business partners. This created friction between the franchisee and the franchisor and certainly stalled the growth. All that has completely changed under Franchise Brands' ownership. The experience the Franchise Brands leadership team has in growing franchise businesses has been instrumental in transforming the relationship we have with our franchisees. Fundamental to that is if you treat franchisees as mature, intelligent business people who are taking responsibility for their business, and then set out what you expect from them, they respond positively. My proudest achievement since I became MD has been the change in the relationship between the franchisees and the Support Centre which is far stronger, more respectful and collaborative than it has ever been. The result of that has been increased ambition, investment and sales. What was the initial reaction of the franchisees to Vision 2023? The initial reaction was one of apprehension and scepticism. They couldn’t see how such an ambitious goal could be achieved. However, through illustrating the market size and potential in their own territories and through our commitment to invest and develop key areas of the business such as IT, marketing and sales, the apprehension soon turned to enthusiasm. We now have a high-powered support package to give franchisees everything they need to grow their businesses, including for example, new training initiatives in marketing, technical, and more recently sales. Importantly we are sharing the success with franchisees through a number of schemes and incentives to encourage and reward growth. What are the key success factors to achieving the Vision 2023 strategy? Vision 2023 is really ambitious and targets a business with system sales several multiples of today’s level. But it's not unrealistic given the £1bn market size, the small 4% share we have currently and the very fragmented nature of the market which lends itself to consolidation. We are in the unique position of having of 40 depots nationwide which are close to our customers. More importantly, Metro Rod is now a nimble, fast-paced business, not encumbered by tedious corporate decision-making processes, and this allows us to react quickly to both market and customer demands and take advantage of the sales opportunities. The key to achieving Vision 2023 is to have everyone in the business, from engineers to contact centre staff, focused on delivering exceptional customer experience. I want all our people to feel part of the business and valued. We have a real focus on elevating the status of our engineers, or as we like to call them "our Heroes". For example, we have increased and improved the level of training, we have introduced newly designed uniforms and, being a 24/7/365 business, we are working hard to facilitate a better work-life balance. Equally the Support Centre teams need to feel that they are part of the journey towards Vision 2023. I was very pleased to issue share options to the majority of the staff at the end of 2018 which will see them rewarded for their efforts in helping us grow the business. What factors do you see potentially impacting progress? The market opportunity is sizeable and we’ve certainly got the capability to take advantage of it. However, a key challenge will be having the right people, not just in terms of their technical expertise, but more importantly their culture, so we can deliver industry-leading customer service. We want to be the employer of choice and attract and retain the best people we possibly can. In addition, we have recently launched an apprenticeship scheme. We will take unskilled youngsters, and put them through a two-year accredited programme, after which they will be fully qualified and have had some fantastic work, as well as life, experience. Finally, what are the prospects for the newer Metro Plumb business? Metro Plumb is really exciting. It is still a relatively embryonic business but with huge potential. One of the priorities for 2019 is to develop the equivalent Vision 2023 strategy for Metro Plumb. The market opportunity we have in plumbing is five times larger than in drainage and we’ve established the platform to market this business actively and attract new customers and franchisees. Metro Rod’s Vision 2023 strategy sets out how we can build a significantly larger business.