Ed Murphy hit success with Snap Printing and Home Instead.
Ed Murphy of GreenTechHQ talks to Francise Matters with Alison Crowzer, author of The Currency He has led franchise businesses that have created more than 6,000 jobs. The Wexford native talks about the key to selecting the right franchise, how to tweak it for the Ireland market, and explains how even a good franchise idea can fail.
Ed Murphy made his name, and his money, in franchising.
Having returned to Ireland in 1992 following stints in the UK, Australia and the US, the Wexford native teamed up with the businessman Michael Kearney.
Kearney, who would later become the manager for the Irish rugby team, had established Snap Printing a few years earlier, and Murphy joined as an equity partner and chief executive. In the years that followed, it became the most successful print franchise company in any country, giving birth to a host of millionaire franchisees.
In 2005, the two men later brought the franchise for Home Instead Senior Care to Ireland. When Murphy sold out of Home Instead Senior Care in 2018, it was the largest home care provider in Ireland, delivering more than three million hours of specialist home care each year from 24 offices throughout Ireland.
In between, they have held the master franchise for the video game retailer CeX and Contours Express, a female-focused gym brand. The former succeeded, while the latter struggled.
All told, the businesses he previously led have created more than 6,000 jobs.
More recently, having spent his career navigating the world of franchises, he has started to build a business from scratch.
GreenTech HQ is an innovation hub located just outside Enniscorthy, a town blighted by a massive long-term unemployment rate.
Murphy launched the incubation centre last year, securing partnerships with the likes of DogPatch Labs, Impact Hub, AIB, Trinity College Dublin, the UN, Skillnet Ireland and Cool Planet, the carbon reduction business led by Norman Crowley. His ambition is that the hub will help create 500 greentech jobs in the region. Given his background, it would be hard to bet against him.
But, developing a business away from the franchise model has been an eye-opener for Murphy, something he readily acknowledges in the latest episode of the Franchise Matters podcast series.
Building a business from the ground floor, he says, is a “much harder road”.
With Green Tech HQ, he says he has “modelled and remodelled and pivoted and re-pivoted and pivoted again to just get the model right”.
“I wouldn’t have had to do that in a franchise. I’d have just taken it and implemented it. I love what I’m doing at the moment but it’s much different to a franchise. And I suppose in general when we would have started franchises, not only are you buying a business in a box, but it’s a great way to go into business if you want to move fast.”
Given a choice between trying to make a million from a great new idea or an existing franchise, Murphy would opt for the franchise every time.
“You’ll make a million quicker because the model is already done, and the risks are far less,” he says.
A life through franchise
Ed Murphy got his first taste of the franchise model in the US with he worked with Gorsevnor Building Services. It was a contract catering and security company, a market segment he accepts few in Ireland would have dreamed of turning into a franchise.
In the US, however, he says the mentality was different.
If someone created a successful business in the US, they immediately tried to “turn it into a franchise model”, according to Murphy. “Everyone wants to build a franchise there,” he says.
Having decided to move home, he entered business with Kearney with Snap Printing. He joined the business in 1992, before selling out in 2004.
During those 12 years, Snap grew exponentially. “We grew the number of outlets from four to 24 throughout Ireland and all very successful,” Murphy says. “I think at one time we figured that from the investment of about 70 grand, I think 70 or 80 per cent of the franchisees became millionaires within five years.”
Part of the success came from being the right business at the right time. “Sometimes timing is not talked about so much in terms of business success, but timing can be very, very important so, it was the right timing at that stage,” he says.
Contours Express and CEX came next. CEX now has 42 outlets around the country, but they sold out after a few years — “Genuinely, we didn’t overly enjoy the business,” he says, adding that it was successful.
Contours Express, however, was a mistake.
“We went to America, we saw it, we loved it,” he says, adding that female-focused fitness gyms were growing strongly at the time.
However, no matter how successful each gym was, Murphy says they could not “grow the chain big enough to create enough revenues in Ireland to effectively create a head office to be able to support those franchisees”.
“You have to be really careful in Ireland, because it’s a small country, and no matter how good you are running the franchise chain, it has to be capable of having enough franchisees. Remember you’re only charging a royalty of maybe 6 per cent to those franchisees, so if you do 20 million, that’s still only 1.2 million. You’ve got to run a head office out of that and give the support.”
He adds: “Some good franchises in other countries haven’t succeeded in Ireland because Ireland is actually too small to create a franchise chain.”
By the time they exited, however, they were also working on Home Intsead. Both Kearney and Murphy had parents who needed caste at home. The only options were the HSE or a private arrangement with an individual. Neither appeared to the pair, so they went to the US to look for a model that could help them — and others.
“We found this company, Home Instead Senior Care in Omaha, Nebraska in the States and we went, and we checked it out. We really liked the people, really liked the culture, really liked the organisation,” Murphy says.
At the time, it had 550 franchisees, a number that Murtpy showed that the model worked. “If you have 550 franchises, you’ve had loads of little failures, whether that’s the IT system you used, the training you used, et cetera, and they will get dynamically better all the time,” he says.
“So, by the time we bought into it, they’d already been way down the road in terms of getting the model right.”
Before recruiting other franchisees, Murphy operated the franchise in Dublin himself. Within two years, the office had become the best-performing division out of 800 Home Instead offices around the world.
“We decided that for the first year, we’d work our ass off in creating one successful centre and even though people came to us after a month to say can we buy a franchise, we said no,” according to Murphy.
As they bedded into the concept, they had to tweak the model to ensure it suited the Irish system — both from a cultural and a regulatory perspective.
Murphy puts the success of the model down to the people who took on the franchise around the country.
“We gave them the training. We gave them the systems. We gave them the structures. We gave them everything, but they had to do it; they had to implement it on the ground. And if, if there was an issue that had to be resolved on a Saturday night at nine o’clock, I wasn’t capable of sorting it out here from my home in Stillorgan in Dublin. They had to do it and sort it out themselves,” he says.
The individuals might have managed operations locally, but Murphy and his head office team essentially had to create the market from scratch.
“We were the first private company that set up in homecare in Ireland. The only people who had done it prior to that were the HSE themselves. And so we had to create a market, and we had to kick and scream and push it out and offer it privately for a number of years before the HSE took us on and subcontracted to us. But that didn’t happen easily,” he says.
Murphy has long exited Home Instead, but he is still involved in the sector. In addition to working on his innovation hub, Murphy has been working with Dermot Bolger and Charlotte Reilly on another venture called Platinum Home Care. Murphy is the chairman of the business, which aims to fundamentally change the home care model here. The company has already secured a national contract with the HSE.
What to avoid, and what to watch
Given his experience in sourcing franchises from other countries and successfully rolling them out in Ireland, I was keen to get his views on what makes a good franchisee and how he decided on which franchise to acquire.
In the interview, Murphy was honest and upfront on both of those key issues.
“People who become very good business franchise owners obviously tend to be a little more risk averse than someone who is an entrepreneur who just gives it a go and hopes for the best,” he says.
“But, in terms of why a franchise works, it is a business in a box. It is a model that has been created and every element of that business has been investigated, whether it’s the customer service, whether it’s the IT system, whether it’s the marketing, whether it’s the branding, whether it’s the operational, whether it’s the pricing. Everything has been checked and rechecked and tested and retested.”
When looking at different international concepts, he said you needed to be supplied with as much information as possible. There is no reason for a company not to be transparent, he says. Adding he would “run a mile” if he was not provided with full details.
“If they’re running a good franchise, you should be able to get all the information, the financial information, whatever, plus they should give you the names of all the franchisees that have currently have,” he says.
A key part of holding a master franchise is deciding who to make your franchisee. In his experience, the best people were not specialists, but generalists with a good understanding of business.
When we were in printing, we didn’t go looking for printers. McDonald’s doesn’t go looking for restaurant owners or restaurant managers. We look for someone who’s a businessperson who can understand a P&L, who can do sales and understands marketing, who can understand a good operational system and is system-organised and whatever. What we don’t like are technicians,” he says.
In the case of Home Instead, they opted against bringing in medical professionals because they had a tendency to tweak the model.
“We had something that worked, and we didn’t want anyone to mess with it because we knew it worked. And so, therefore, we want a business owner. And we can teach them all they need to know, and we can actually… we can hire the nurses or the doctors and whatever. We hire the specialists, but we want business owners,” he says.
Printing. Home care. Computer retail. Gyms. I asked Murphy what he would like to franchise if he was starting again. He points to the obvious examples of food and healthcare, but also refers to new emerging industries.
“In terms of franchising, what’s emerging a lot more now is franchising in the education sector, with different education, private education. There is lots in the whole area of coaching, training and consultancy in different sectors,” he says.
He also says there is room for the franchise model in digital transformation and AI and augmented reality.
“There’s a lot of technology franchises hitting the ground at the moment,” he says. “There’s also in the whole area of cleantech and sustainability and climate change and energy, there’s a number of franchises emerging in that area.”
He says: “I wish I was twenty or thirty again because there’s plenty of opportunity.”
