Choose Wisely When Exploring International Opportunities
For any successful business, the discussion around growing never ends, especially for those based in the U.S. and seeking to expand beyond its borders.
And while the opportunity to dip your business toes into international waters is a thrilling one, there are numerous factors to consider when thinking about international expansion. This is especially true for franchise-based businesses like ours here at Massage Envy.
For 14 years, Massage Envy has been the go-to brand here in the U.S. for affordable massage and skincare services, thanks to an industry-leading membership business model. To date, we have grown to over 1,145 franchise locations and delivered more than 100 million massages and facials. So after more than a decade of success here, we felt it was time to expand Massage Envy’s belief in total body care internationally and become a global brand. After all, massage and facial therapy are internationally understood and accepted as a way towards better body maintenance.
This May, we opened our first international location in Sydney, Australia, the first in a 100-unit, 15-year deal between Massage Envy and Australian-based Collective Wellness Group, which will manage our Australian operations.
Where and Why
Expanding on a global stage is a major step and franchise leaders should put serious thought into where they should venture. In looking at the top 50 countries around the world, we first ranked them using 14 different metrics including, GDP, Economy, Political Environment and awareness of our industry to name a few. This ranking generated a “Top 10” list with Australia landing in the top three.
Australia was an amazing fit for us, given the country’s strong belief in health and wellness and its focus on well-being techniques – like regular massages – to better its citizens’ quality of life. Though considered a complementary and alternative medicine form in Australian healthcare, massage services are part of a $3.5 billion industry in the country. And that number is steadily growing. We were fortunate to leverage some earlier relationships already established and we agreed to a master franchise agreement in a relatively short time.
The Perfect Partner
Choosing the perfect partner for any venture in life is not a knee-jerk decision and we have very specific attributes we are looking for that are a fit with our brand, such as passion for overall health and wellness. But an optimal partner for us is also one with meaningful presence or an established network in the restaurant, retail or entertainment categories and who has the infrastructure to support either company owned stores or franchised stores like our model in the U.S.
We chose the Collective Wellness Group as our Australian partner because they already have an experienced, on-the-ground team in all the key areas: real estate, operations, training and marketing. They have an incredible reputation and currently have the master franchise agreements for two other wellness-focused businesses totaling over 450 stores. Working with them, we’ve seen how aligned they are with our core values and enthusiastic belief in our brand promise to help you take care of you.
Working Out the Kinks
Opening in a new country is always an exciting venture – but there can be challenges. With the help of our Australian partners, we have overcome them, demonstrating why having an experienced “on-the-ground” partner is so crucial for the success of any international expansion.
For example, due to an internet latency issue from Australia to the U.S., we had to establish a technology hub in Sydney to better support our franchise partners. We’ve also had the opportunity to proactively train the Collective Wellness Group team on our industry-leading policies and procedures and established a dedicated international department with its own operations and training team that will closely oversee the Australian expansion.
There have been some considerations and adjustments we’ve had to make. While flexibility is a must when you explore ventures of this sort, keep in mind you don’t need to change your core offerings or beliefs too much. In terms of services, Massage Envy members and guests in both the U.S. and Australia will enjoy the same high-quality customer experience and service offerings. However, due to a separate technology hub and the management of the current exchange system in Australia, U.S. Massage Envy memberships cannot be used in Australia.
Another caveat to consider is the business “win-win” international expansion should create, especially for future franchisees. Because of our success in the U.S., Collective Wellness Group leaders are eager to introduce the membership model to Australia and potential franchisees there. There is great opportunity for franchise growth when new markets are opened and in our case, we’re partnering with a management company with a stellar reputation and who already support two other wellness-focused businesses.
We have an ambitious outlook for international growth in countries where wellness is highly touted, with master franchise partners that provide the right business and operations support. We’ve had exceptional success here in the U.S. providing members and guests the access to incorporate massage and facial services into their total body care routine and now is a perfect time to share this with the world.
By Lee Knowlton, SVP of Global Sales & International, Massage Envy