It’s not just TAB: The Reason Why Franchises Work


TAB: A History

The Alternative Board was founded in Missouri in 1990. As with so many successful businesses, the rationale behind it was the answer to a simple question.

Why can’t owners of a small business benefit from the same advice that’s available to big businesses?

TAB founder Allen Fishman knew how much he’d gained from the advice of a board of directors throughout his business career. But where did the owner of a small business go for that advice?

The traditional answer was his bank manager, his accountant or his solicitor – but, however well meaning, they all had their own axe to grind. And what did the bank manager really know about the pressures of running a business? Secure in his job and with a comfortable pension to look forward to, could he ever know what it felt like to tell your wife that the house was on the line…

The all too apparent answer was ‘no.’ The only people who really understood what it was like to run a small business were the owners of other small businesses. They were the ones who understood what it was to put your family’s security at risk, to realise you needed to fire someone whose mortgage depended on you – and to face the loneliness that being an entrepreneur can bring.

And so The Alternative Board was born. From the very beginning it operated on a franchise model, although – in relative terms – it was very late to the party.

Why are Franchises Successful?

According to Wiki the word ‘franchise’ comes from the French franc, meaning to be free. Well, if you’ve been trapped in the corporate world, that will seem entirely appropriate. While the boom in franchising started after the Second World War, its history goes right back to the middle ages, when landowners created what might be termed ‘franchise arrangements’ with tax collectors, allowing them to keep a percentage of the taxes they collected. There’s an idea for Philip Hammond to consider as he mulls over his Spring Statement…

Why has the idea of the franchise proved such an enduring success? For me, the biggest factor is that you know the idea works. Yes, you’re spending some money to buy into the franchise, but you’re buying an idea that has been proven to work. It’s no surprise that the percentage of successful franchise start-ups far exceeds that of the go-it-alone start-ups, by a ratio of about 9:1.

We all know the names of the most successful franchise operations: McDonald’s, Starbucks, Dunkin’ Donuts and Subway, by location now the biggest franchise in the world. In business terms the biggest company is a name you might not have heard of: H&R Block, a tax preparation company operating in the US, Australia and India which has around 12,000 offices.

But in terms of business coaching there is one clear world leader, and that leader is The Alternative Board which, 29 years after Allen Fishman founded the company, now operates in 20 countries with more than 400 franchisees. Between them those franchisees have experience of more than 300 industries and have helped more than 15,000 businesses with a combined turnover of more than $11bn.

But the most telling stat for me is that the average member of a TAB board has been a member for more than 4½ years.

I think that is a remarkable figure. Simply put, it demonstrates that TAB delivers results. Owners of SMEs are not known for placidly tolerating ideas that are not working: you simply don’t stick with something for 4½ years if it isn’t delivering results.

And the key reason why TAB works so well in 2019 is exactly the reason why it worked so well in 1990. The owner of a small business still cannot access the advice, experience and expertise that is open to someone running a larger business – unless he surrounds himself with his peers.

Looking Forward

That is why I am so excited about the future – not just in the UK, but for my TAB colleagues around the world. But obviously my focus is on TAB UK: as I wrote at the end of last year, ‘my vision is to see us helping 1,000 business owners – and thereby benefiting around 25,000 employees and roughly 100,000 people in their families.’

And there’s even more good news. Despite the current uncertainty in the UK, the entrepreneurial spirit is alive and well. In fact, it’s alive and well everywhere. Generation Z is apparently going to be the most entrepreneurial generation ever. I cannot wait…


Read more of my blogs here:

The Importance of Cyber Security for Your Business

Leadership: The Key to Prosperity

What Can Businesses Learn from the Vegan Sausage Roll?

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