28 June 2021

A safeguard for franchisees

With a dedicated team and access to insurance wording designed specifically for franchise holders, it’s no wonder the Franchise Association of New Zealand (FANZ) has been working with Crombie Lockwood for over seven years.

Crombie Lockwood Business Development Manager, Paul Kuhn, says that Crombie Lockwood has stood the test of time for franchise holders operating in a variety of industries.

“We really pride ourselves on our flexibility; we have the ability to modify our covers to suit the best interests of the specific franchisee,” he says.

“When you think about it, a large component of what anyone investing in a franchised business is buying are proven systems and processes. And from the insurance side of things, that’s what we offer as well.”

As the only insurance partner for the Franchise Association of New Zealand (FANZ), Paul says Crombie Lockwood is able to provide very specific support. As an extension of its SMARTpak product, Crombie Lockwood offers unique insurance called ‘Loss of Attraction & Loss of Fees’.

“It is designed to help protect your business interests when an insured loss causes access issues and steers your customer base away. It applies even in cases where an anchor tenant which attracts large numbers of customers is forced to close, meaning there are potentially fewer people passing your premises, having knock-on effects on your turnover.”

Paul cites an example of this policy at work in the wake of a strong earthquake in the Wellington region in 2016.

“We negotiated ‘Loss of Attraction’ for a café franchisee in a shopping mall in Lower Hutt. Following the earthquake, the mall owner had to close down the movie theatre attached to the mall, which was very much an anchor tenant on that site.

“The café itself was unaffected by the earthquake, but we were able to prove a decrease in turnover as a result of the movie theatre closing; hence a ‘Loss of Attraction’ for that client.”

Paul says that while shopping malls present obvious benefits to retail franchise holders, sometimes there are occurrences in mall environments where the individual franchisee has no control over the situation, such as a fire in a supermarket.

“The supermarket is the clear drawcard for the bulk of shoppers visiting the mall, but if that establishment is no longer available to the public, it affects everyone.”

“There are risks and rewards in becoming a franchise holder. Our products are designed by experts who’ve been working alongside franchisees for many years to provide coverage that is best suited to this unique business scenario.”