Franchisers Look To Urban Areas

Why Put a Lawyer In the Crow’s Nest?

Corrections or additions?

These articles by Kathleen McGinn Spring and Bart Jackson were

prepared for the May 15, 2002 edition of U.S. 1 Newspaper. All rights

reserved.

Linking Business with Community

In an iffy economy every business has to make the most

of what is has. And for many businesses, a key strength is community.

"Since 9/11, people are staying in the community more," says

Marsha Stoltman, owner of the Stoltman Group, an event planning

company. "We’re teaching businesses how to capitalize on the

community."

Stoltman is organizing "Making Magic Happen. . . Connecting

Business

Success with the Community" on Friday, May 17, at 8 a.m. at

Scoozi’s

restaurant in Hamilton for the Hamilton business community. Presenting

a workshop is Allen Zingg, owner of Magic of the Imagination,

a consulting business specializing in non-traditional communication.

The event is sponsored by the Hopewell Community Bank. Cost: $25.

Call 609-588-8703.

Stoltman and Zingg are both Hamilton residents, and until fairly

recently,

New York commuters. Stoltman was the event planner for Editor &

Publisher

magazine and Zingg was working in human resources for the Children’s

Television Workshop. Stoltman, who started her company just one year

ago, admits that her timing could have been better.

"This is a terrible time to start a business," she says, and

her type of business, drawing as it does on discretionary corporate

dollars, is particularly hard hit. "As soon as the economy goes

south, the first thing they cut is entertainment and travel."

Nevertheless, with Editor & Publisher as an anchor client, she is

forging ahead.

Zingg has been in business for himself for three years, and is unfazed

by the economy. His business specializes in inculcating uplift, and

he says the smart company will realize it needs its troops to be

energized

and upbeat now more than ever.

Zingg has been a magician and mentalist — basically a mind reader

— since he was a small child, and he includes those elements in

his presentations. A specialty, he says, is "creating engagements

that deliver a key message in a memorable way."

As an example, he recently was called in by a company to see if he

could get two contentious departments to work well together. His

engagement

consisted of sitting everyone together in a room and having them pass

a balloon around. The balloon obviously contained something, but it

was not clear what that something was. As each person caught the

balloon,

Zingg asked for a number or a color or the name of an animal. Every

person had to call out an answer. Then, the balloon toss over, it

was popped and there inside was a piece of paper — and on the

paper were all the random words the audience had called out.

Zingg declined to say how he had pulled off that magic trick, and

in fact seems a little uncomfortable with the notion of tricks. There

is magic all around us, he says. We ourselves are magic. That, and

not a mere trick, is his over-riding point. In the case of the feuding

departments, the specific point was that co-operation could be

effortless,

and fun. He says that his way of teaching — of engagement —

drives the lesson home in a way that team building and lectures do

not.

He will use engagement to illustrate all of his points during his

upcoming presentation to Hamilton businesses on the value of

community.

Here are a couple of those points:

Don’t just brand your toaster. Companies used to focus

mightily on branding what they do or what they produce. "`We have

the best toaster,’" Zingg gives as an example. There is a new

paradigm, he says. "The smart money understands we have to brand

who we are."

This is especially important for a community business. People trade

with people they like and trust. The toaster may be more expensive.

There may be a longer wait for a table. The selection of pick-up

trucks

may be less extensive. None of that will matter much to the consumer

if he is greeted by name by a smiling proprietor he has come to like.

Think further out. Bottom-line-driven companies have been

giving short shrift to cultivating long-term relationships — with

customers and with employees. "`There will always be another

employee.

There will always be another customer,’" is how Zingg

characterizes

this way of thinking.

There is tremendous value, though, in working to create loyalty.

Customers

like to recognize their tellers, know their waitresses by name, and

give their copy orders to the young man who graduated from high school

in their son’s class. Employers who value their employees enough to

hang on to them create these bonds, and enrich their businesses along

the way.

Capitalizing on the importance of community is not only a boon

for companies that serve consumers, but is also a tool for the service

businesses that vie for those consumer companies’ dollars. Knowing

what customers want now, says Zingg, puts marketers and similar

companies

in a position to win new clients. No obvious magic there; just common

sense.

Top Of Page
Franchisers Look To Urban Areas

Franchisers have saturated much of suburban America,

planting McDonalds, Chick-Fil-A, Jiffy Lube, and Starbucks in or near

most every mall and highway. Now, says Gina Galli, project

manager

with the New Jersey Economic Development Authority, "international

franchisers are vying to encourage franchises in urban areas."

On Tuesday, May 21, at 8:30 a.m., the EDA holds a workshop,

"Franchise

Opportunities: Entrepreneurial and Business Development" at the

Lafayette Yard Marriott in Trenton. Cost: $35. Call 609-341-2065.

"Franchising is a great way to go into business for yourself,

but not by yourself," says Galli. Her agency held a similar

franchise

opportunities workshop in northern New Jersey in January, and she

says six to eight participants are now in active discussions with

franchisers.

When people think of franchises, Galli says, they think of food —

the Popeye’s Chickens and Burger Kings and Dunkin’ Donuts outlets

are the first things that spring to mind. But this is just one

franchise

niche. There are automotive franchises, tax preparation franchises,

dry cleaning and home cleaning franchises, and many other categories.

Many companies owning these outlets are just now recognizing, Galli

says, that "urban areas are very much an untapped arena."

This opens a window of opportunity for those interested in becoming

business owners.

Requirements for receiving a franchise license vary widely, says

Galli.

In some cases, background in the business is required, in other cases,

she says, franchisers prefer their franchisees to learn from them,

and may even see a background in the business as a liability. Some

franchise licenses run into the millions, as would be the case for

obtaining the rights to run a large hotel. In other cases, the

financial

investment is modest.

"There are a lot of resources out there for financing a

franchise,"

says Galli. "There is equity financing and financing from the

franchiser is sometimes a possibility." In addition, the EDA

offers

loans to new and existing businesses. "We do half-a-billion in

financing each year," Galli says. "We have well over 20

programs."

Banks are another source of start-up capital for a franchise.

"There

are banks out there that are very interested," says Galli. In

fact, she adds, PNC is the sponsor of the May 21 event.

Franchisees may have to come up with collateral for a loan, and good

credit is a plus, but, says Galli, less than perfect credit is

"not

necessarily a deal stopper.

There is lots of help available for new franchisees. Organizations

like Downtown New Jersey might help with finding a location, for

example.

And the EDA, through its entrepreneurism workshops, prepares those

thinking of striking out on their own, with or without the help of

a franchise license.

For a franchisee, just as for the owner of a stand-alone business,

the most important factor — by far — is "sound business

planning," says Galli. "You need a solid business plan, the

ability to stick to it, and the ability to understand the

business,"

she says.

Insight will be available on May 21 as representatives from

franchises,

including Dunkin’ Donuts and Ramada address attendees. Also speaking

are business owners who have chosen the franchise route. They will

share their experiences and give those who are thinking of taking

the same route to independence an inside look into the challenges

and rewards of operating a franchise.

Top Of Page
Why Put a Lawyer In the Crow’s Nest?

Gingerly your vice president places the threatening

document on your desk. Five million in damages is demanded from your

competitor claiming that you pirated his employee who had been

shackled

by a non-compete agreement. Swiftly you swing into action and heap

all the blame on your in-house lawyer. But alas, it is too late and

the wrong target. You might as well blame your personal trainer for

your obesity-engendered heart attack.

Those seeking a more judicious path toward business health might want

to heed the advice of attorney Alina Denis Jarjour, who speaks

on "Uncovering Discrimination: A Self-Audit," on Thursday,

May 23, at 7:30 a.m. at a meeting of the Employers Association of

New Jersey at Fairleigh Dickinson University. Also speaking are

John

Sarno and Robin Ross of EANJ and Diana Krajewski,

founder

of Luminara, a human resources consulting firm. Cost: $55. Call

609-393-7100.

Born and raised in a Miami business family, Jarjour earned a B.A.

at Florida International University and a J.D. from the University

of Pennsylvania. She founded her solo practice in Florida, but for

the past 12 years has been based in Parsippany, where her specialties

include telecommunications, professional services, healthcare, arts

and entertainment, and retail. She has also served as Verizon’s

in-house

counsel, guiding the telecommunications giant through many contractual

mazes.

Jarjour sees a corporate attorney as someone who advises the captain

to put a man in the crow’s nest because there might just be an iceberg

out there. The captain grumbles about wasting an able bodied man.

"But however remote the possibility," says Jarjour, "you’d

better have someone to warn you and help plant some safeguards."

Currently, most larger firms willingly invest in ample in-house staff

and available outsources to establish a preemptive legal fortress

surrounding all their activities. However, small and medium

businesses,

Jarjour points out, frequently and wrongfully regard preventative

legal care as beyond their means.

Visions of a trusted legal retainer being cashed in for a battery

of high-priced specialists make most owners (and their accountants)

blanch. But full legal foresight is less a matter of quantity, says

Jarjour, than of proper initial selection. "There is still a role

for the lone general business counsel," she insists. "The

goal is to select an attorney who has primary expertise in two or

three of your highest use areas and enough ready contacts to outsource

the rest."

As international and high tech trading link onto traditional business

modes, our law’s specialties and specialists explode. Jarjour actually

sees this specialization as a benefit to the client. "Somewhere

nearby awaits an absolute expert in the field you need," she says,

"who constantly keeps abreast of that body of law."

Once an owner has selected counsel, the first joint task must be a

full legal audit of the entire breadth of the company’s transactions.

Red flags will doubtless pop up in areas the firm probably never even

considered.

Intellectual property. "Digitalization has made this

whole topic an incredible mine field," says Jarjour. Website

ownership

frequently bounces about like a baseball batted into the stands. The

culprit? Imprecise contractual terms. A site that the business owner

commissioned for his company can default to the employee or the worker

for hire who designed it if the terms do not otherwise specify.

Equally common is the problem of slander. If an employee sends a

slanderous

E-mail on his employer’s computer, is he assumed to be speaking for

the company? Is the company as liable as the employee for the damaging

accusation? Several corporations that have not spelled out exact

computer

use rules have been named in similar suits.

Consultant vs. employee. Many an owner who has brought

in a consultant and listed her compensation on a 1099 form has found

himself in tax trouble when the IRS judges this worker to be an

employee.

"If your behavior toward this consultant is reflective of an

employer

towards an employee, regardless of intent," warns Jarjour,

"you

might be crossing the legal line." This is a combined tax,

accounting,

and management issue with nuances that must be understood in detail.

Employee rights. Severance packages, hiring terms,

promises

of promotion, illegal demands, or allowances are contractual items

that tend to be left alone to grow rigid and inoperable. Under certain

circumstances, you may not, for discrimination reasons, be able to

demand a high school degree for all your line workers. Jarjour

invariably

asks her clients if there is an employee manual that covers fully

and specifically the situations owners often lay at her door.

Restricting contractual employees. Are you able to lock

a valued employee into an agreement forbidding him to work for a

competitor

for six months? Longer? And even more insidious, how far do you have

to go in checking on new employees to make sure they are not

concealing

such agreements?

A full legal audit and establishment of a preventive checklist

may seem a bothersome and expensive investment for your company.

However,

it usually takes just a twitch of a contract or small addition to

the employees’ manual to eliminate the risk of massive damages to

your firm from some blind side. After all, you never know when an

$5 million iceberg may be looming just beyond the horizon.

— Bart Jackson


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