The aim of this High-Level Capacity Building Seminar is have an international exchange of information on inclusive entrepreneurship actions across the European Union and on how the European Union Structural Funds can be used to support actions that combine entrepreneurship promotion and social inclusion.
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An innovative tool to facilitate entrepreneurship : Adie’s social microfranchise
1. An innovative tool to
facilitate
entrepreneurship :
Adie’s social
microfranchise
2014
2. 2
Adie has launched an innovative business
approach, Social microfranchising, aiming at
creating between 3,000 & 5,000 self-employment
opportunities
ORIGINS
Since 1989, Adie has granted over 130,000 loans in France (>14,000 in 2013)
In 2009, Adie launched an innovative business approach in order to meet the needs of
individuals who lack a viable business project idea and/or do not want to start their
business alone : Adie Social Microfranchising
GOAL
Overall, Adie aims at creating between 3,000 and 5,000 independent jobs by 2020
IMPACT
Over 120 jobs have been created withing the two first microfranchise networks, whose
cumulated job creation potential exceeds 1,000. Five other microfranchise projects are
currently under study or at a pilot phase
3. 3
Our mission is to offer unskilled people a turnkey
business activity to be developed within a
franchise network for a small initial investment
• Trademark
• Shared services
• Know-how
Micro-
franchisee
Micro-
franchisee
Micro-
franchisee
Micro-
franchisor
Microfranchising is a development
tool that seeks to apply the
proven marketing and
operational concepts of
traditional franchising to very
small businesses.
Microfranchisees are members of a
franchise network and have
therefore access to a trademark,
shared services, and the
franchisor’s know-how.
4. 4
How Adie create a microfranchise?
Dedicated
investment fund
(AMSI)
Invest
Adie’s branch
network
Business partner:
large company or
social
entrepreneur
Micro-
franchisee
Micro-
franchisee
Micro-
franchisee
Micro-
Franchisor
Dedicated incubator:
Adie’s Social
Microfranchise (AMS)
5. 5
Two different types of social microfranchise
Chauffeur&Go
• Chauffeurs without
vehicles
• Launched in 2010
• 2013 : 90 chauffeurs in the network
• Objective 2014 : + 40 chauffeurs
Other projects under study (ex : cyclotaxis)
La MicroFranchise O2 Adie
• Gardeners
• Launched in 2011
• 2013 : 30 gardeners
• Objective 2014 : + 50 microfranchisees
Other projects under study (ex : street food,
ironing…)
MICROFRANCHISE IN
PARTNERSHIP WITH LARGE
COMPANIES
Large job creation potential
(minimum 200 microfranchisees per
network)
MICROFRANCHISE IN
PARTNERSHIP WITH
ENTREPRENEURS
Medium job creation potentiel
(around 50 microfranchisees per
network)
1
2
6. 6
Adie Social Microfranchising : an innovative
initiative to address unemployment
• An innovative answer to unemployment
• More and more low-income entrepreneurs
• AMS offers turnkey business concepts to be developed in microfranchise networks
• An innovative solution against start-up obstacles
• Strengthening small businesses sustainability
• High replicability and scalability
7. 7
We have identified key success factors to develop
microfranchises, but still face challenges
• Microfranchise key success factors
• Size, accessibility and sustainability of the market
• Solidity of the business model at both franchisor and franchisee levels
• Expertise and mindset of our business partner
• Transparency and balance in our partnership with large firms or entrepreneurs
• Main challenges to be faced :
• French complex legislation which can sometimes appear as a real constraint for
social innovation and the development of simple concepts, scalable and easy to
duplicate (e.g. education requirements to become a bicycle repairmen or a home
delivery driver in France)
• Development of sustainable business model at both franchisor’s and franchisees’
levels which can be challenging when we talk about small businesses
• Project development path which is often slowed down by operational issues
• Internal processes, training and communication have to be adapted and are key to
secure the appropriation of the project by local teams
8. 8
Summary
• Adie launched an innovative business approach in order to meet the need of individuals
with no business projects or not ready to launch their own business alone
• By developing social microfranchises, Adie aims at offering unskilled people a turnkey
business activity to be developed within a franchise network for a small initial investment
• So far, Adie succeeded in launching two microfranchises creating 120 independent jobs
and has five other projects under study. Overall, Adie aims at creating between 3,000 and
5,000 independent jobs over 10 years
• Even if the potential of social microfranchise in
job creation is huge, the sustainability of each
franchise is secured when economic
break even is reached both at franchisees and
franchisor levels. At franchisor level, it can
happen three years after project launch for
instance.
Frank, microfranchisee in gardening
Editor's Notes
Projetcts / pilote
Independent micro-entrepreneurs, members of a network :
Accessible business activity, no particular skills or degrees required
Limited initial investment which can be financed through microcredit (<10, 000 €)
Microfranchisees pay limited royalties to cover microfranchisor’s costs
Adie mobilizes ressources at 3 levels in order to enable the development of social microfranchises:
1) Dedicate investment funds: Supports the development of social microfranchises by participating in the microfranchisor’s capital
Business partner Invests in microfranchisor’s capital and brings Know-how, trademark & shared services
2) Dedicates incubator: AMS
Identifies and develops viable business concepts that are suitable to microfranchise models,
Sets up pilots to develop and refine models, tools, systems and processes,
Turns the resulting product into a microfranchise (training, financing, marketing and support)
Convinces partners to develop and invest in a social microfranchise with Adie
3) Adie’s branch:
Grants loans and financial services
Delivers business development services
Animation
La microfranchise solidaire focalise son action sur TROIS TYPES DE MICROFRANCHISES pour agir à différentes échelles
Adie develops two different types of social microfranchise and has two networks rolling out in France
An innovative answer to unemployment
More and more low-income entrepreneurs:
Have trouble developing their business activity
Do not want to start their business on their own
Want to create their own small business but have no viable business idea
AMS offers turnkey business concepts to be developed in microfranchise networks: Adie’s Social Microfranchising enhances micro-entrepreneurs’ revenue and profit and boosts their development path (exemple of gardener)
An innovative solution against start-up obstacles
Business services and support from the microfranchisor at each step of the microfranchisees’ business development
Strengthening small businesses sustainability: a profitable business model for both microfranchisor and microfranchisees
The microfranchisor’s experience, proven operational and marketing concepts and continuous support secures the success of the business model
Microfranchisees have higher revenues than stand-alone independent microentrepreneurs and benefit from a faster business development path
This two-level profitability secures long-term sustainability of each network
High replicability and scalability
Microfranchising is a means of duplicating success, for very small businesses, at a large scale
A relevant business development methodology: AMS has a 5-year experience in developing social microfranchises
A dedicated social investment fund (AMSI): Providing financial support to generate social impact alongside a financial return