Franchising Fred Heritage · 10 June 2016
Second Cup: The 40 year-old franchise honing in on the UK high street
From humble beginnings in a Toronto shopping centre in 1975, Canadian coffee chain Second Cup has expanded to 30 regions and come to operate more than 160 cafes worldwide in its 40-year history, serving premium fair trade tea and coffee alongside a wide range of food and drink. In 2016 the franchise set its sights on the UK and so far five new locations have opened across the country so far, whilst another six are planned before the end of the year. Business Advice caught up with Second Cup’s European franchise director Jon Cullen, to find out the secret to the long-term success of the firm’s franchising model. (1) HI Jon, how’s it going? Things are going really well. Second Cup is expanding across the UK at a steady pace after nearly two years of planning. We currently have five new locations up and running, and will have six opened by the end of the year. And were covering the UK. By the end of 2016 well be in Manchester, Birmingham, Cardiff, Leicester and Norwich, as well as have locations in Putney, Harrow and Kensington amongst others. (2) What’s your background in franchising? Ive been working in UK franchising for 25 years in various roles covering operations, sales and logistics. Ive worked at a senior level for a lot of my career, and have learnt how to understand markets, source products, develop relationships with banks and property owners, as well as leasing companies, designers and fitters (3) What’s been the driving force behind setting up Second Cup in the UK? The coffee industry in the UK is growing by between nine and 11 per cent a year in the UK. By 2021, the sector is expected to be worth around 22bn representing huge growth. Although there are many established coffee chains on the high street, people still want greater choice. As people’s taste buds change, weve developed subtler blends of tea and coffee which we feel therell be a demand for. Lots of people travel internationally, and many will recognise the Second Cup brand after spending time in Canada or the Middle East it’s a brand that people trust. (4) What made you decide that franchising was the best model for growth? Second Cup is a 40 year-old franchise, so it’s grown through franchising since day one. Weve found that franchising provides greater access to new markets and offers investors something different. it’s a clinical, sensible way to develop a brand. (5) How do you go about choosing your franchisees? What criteria do they have top meet? The brand only partners with franchisees that are willing to invest in multiple stores, rather than individuals that take over just one location. We have 12 UK franchise partners so far, all of whom have agreed to operate between five to ten stores at different locations. While there arent strict criteria, all of our partners have backgrounds in either food and beverages or retail, with the experience of developing a business and the infrastructure needed for growth already in place. Our franchisees are management companies that buy up clusters of stores as an investment that develop a team to operate them. In the future, as we look to more provincial parts of the UK, Im sure we will be changing our policy to bring individuals into our franchising model.
ABOUT THE EXPERTFred Heritage
Fred Heritage was previously deputy editor at Business Advice. He has a BA in politics and international relations from the University of Kent and an MA in international conflict from Kings College London.