EE Franchise - Is It Really a Franchise?

26/10/2018 18:00 | Start a business

ee franchise

If you’ve spent any time on UK high streets, you’ll have noticed the rapid growth of a relatively new player in the mobile telecoms industry. With its distinctive branding, well-advertised offers on the latest mobile phones, and national TV campaigns, EE has worked hard to establish itself as the country’s go-to mobile provider.

In part, this rapid growth has been facilitated by the franchising model. However, the vast majority of EE stores are still owned by the business itself. Here, we take an in-depth look at the company and attempt to establish whether it should be considered a franchise or not.

Who is EE?

EE – formerly known as Everything Everywhere – is a UK-based mobile network operator and internet service provider. Founded in 2010, the business was acquired by BT in 2016 and is now one of the country's most popular mobile networks. It also boasts some of the most comprehensive network coverage of any provider, with its 4G and 2G networks reaching approximately 99% of the UK population.

EE operates around 700 retail stores around the UK and aims to develop an extensive network of brick and mortar locations that ensure that 95% of the UK population is within a 20-minutes drive of one of their stores. The business has also pursued a "white-spot" expansion policy, by which they focus on expanding into areas that previously had little or no access to their products. EE has a historical association with Orange and T-Mobile and has continued to stock their products in EE stores.

EE? T-Mobile? Orange?

The EE brand emerged out of a joint venture between Deutsche Telekom and France Télécom, who merged the UK arms of their T-Mobile and Orange operations. This gave it unprecedented control of the UK market and made it the biggest 4G provider in Europe. In the UK domestic market, it boasts approximately 30 million customers and has established a widespread presence on the high street.

The business' origins mean that EE can stock a wide selection of goods, under different brands. In-store, EE retail Orange, T-Mobile and EE branded products, ensuring that customers are afforded a healthy choice.

Is EE a franchise?

Though the business owns the vast majority of EE stores and managed by those within the company's internal hierarchy, it has opened several franchise stores. Currently, there are more than 100 franchise stores in the UK. The business has favoured a multi-unit approach, encouraging their franchisees to open, own and manage several units. Consequently, the entire range of franchised stores is owned by just 25 franchisees.

The company's large marketing budget and great brand reach make it an enticing prospect for many would-be franchisees and ensure it's a popular choice amongst those researching franchise opportunities. Though the vast majority of EE stores are managed “in-house,” the company is still able to offer an extensive and comprehensive franchise package that helps franchisees build their business as quickly and healthily as possible.

EE franchise for sale

At this moment in time, EE isn't taking on any new franchisees – primarily due to the remarkable success of their franchise recruitment programme. Despite this, the business has assured interested individuals that franchising plays a significant role in its plans for future expansion.

The company's merger with BT in 2016 resulted in considerable delays to franchise rollout, as the business paused intake to assess whether franchising was still a suitable way to achieve higher growth. Despite there being doubts as to whether the franchise programme would ever re-open, EE has been unequivocal in their support of future franchising. In 2017, they were quoted as saying,

“Franchise remains a key part of our strategy... We have temporarily paused the expansion of new franchise stores while we’re planning for the next year and beyond, but we are planning to reopen our programme.”

EE franchise stores

EE typically has a great deal of input on where franchised stores are located. This means that they often scout locations and offer them to franchisees, rather than allowing franchisees to dictate the location themselves. In the past, EE has also prioritised multi-unit ownership over and above finding new franchisees. Consequently, those looking to acquire a new franchise will have to make a significant impact if they're to be granted the licence.

When EE re-open their franchise programme, prospective franchisees will need to be well prepared and capable of completing a high-quality application. Due to demand, it’s likely that you’ll only get one shot at EE franchise ownership, so it’s imperative that everything meets the necessary standards and you’re able to paint as positive a picture of yourself as possible.

EE franchise cost

As the franchise programme is currently closed, there are no accurate investment figures for an EE franchise. However, due to the size of the parent company, prospective franchisees can expect considerable financial help (if required), when establishing their franchise. Most major banks will be willing to lend to a franchisee based on the fact that EE is a reputable business with a great deal of experience in the industry and considerable financial clout.

The brand reach that EE have managed to develop over the years means that franchisees can expect to pay a premium for the right to own a store. However, the high price tag is likely to be more than justified by the excellent support franchisees receive and the ample opportunities there are to grow your business beyond a single franchise store.

Existing EE franchises

Though many of EE's current franchisees are individuals who have worked hard to establish their franchised business, the company's franchisees also include management groups. For instance, Chrome PSG operates nine stores in the north-east of England. Founded in 2014, the retail management group aim to provide a specialised sales and management platform for businesses in the retail sector. This has allowed them to become one of EE's key franchising partners and an example of just how successful the franchising model can be.

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