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| Social Franchising.. |
Into Africa
"Franchising can do more to save the world than anything (else) invented by man." –Scott Hillstrom, founder of the HealthStore Foundation
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Michael Seid was walking down a hall at the International Franchise Association convention a couple of years ago when a colleague stopped to introduce him to Scott Hillstrom—or as Seid put it: “to pass him off.” Seid intended to listen to Hillstrom’s pitch about saving lives in Africa via franchising just long enough to find another unsuspecting consultant to pass Hillstrom onto.
“Three hours later I was still standing in that alcove,” Seid says.
That chance meeting led to Seid, managing director of Michael H. Seid & Associates (MSA), catching a flight to Africa in April and spending almost two weeks observing the programs Hillstrom’s nonprofit, HealthStore Foundation, has set up in Africa to tackle the problems of malaria and other diseases—30,000 children die each day before their fifth birthday, many of whom could be saved by treatment that costs between 10 cents and $5.
During the information-gathering stage, Seid traversed roads that weren’t really roads to reach villages where the homes were a collection of shacks with dirt floors, no running water and often lit by a single 120-watt light bulb. He witnessed the residential spraying program in Uganda, where DDT is sprayed on the interior walls of homes to kill the mosquitoes that carry the virus, and watched nurses who were franchisees of the CFWshops (Child and Family Wellness) in Kenya talk to students about AIDS and other health issues.
The entire time his mind was racing with the details of how business-format franchising could not only save lives, but create a replicable model that could provide jobs, guarantee consistency in health care delivery and develop local resources.
“Half the drugs in Africa are bogus,” Seid says. So a mother who has walked miles to a government clinic to receive the drugs to save her child’s life has a 50-50 chance of the drugs being real—or on the shelves. The CFWshops have quality drugs, but here’s their challenge: What do you do if the mother doesn’t have the money to pay for the drugs?
The trip, and the moral dilemmas it presented, was life-altering—for Seid and, perhaps for the program as well.
 To reach the rural sites meant Michael Seid had to fly in a two-engine prop plane landing on a dirt runway with no tower to guide them in. |
“My life revolves around making people lots of money—gobs of money—and along the way I’ve done well, too,” he says, “but no one’s ever said to me that I could save millions of lives….He (Hillstrom) didn’t sell it on guilt, he sold it on ego.”
Ego—because Seid believes he has the solution. It’s what he does for a living. In the United States, a franchise measures its success in a variety of ways, including its P&L. For the HealthStore Foundation, success is measured in coffins. If a typical U.S. franchise doesn’t make its numbers, the shareholders get cranky...maybe leadership changes. In Africa, “mistakes equal a coffin,” Seid points out.
By the end of the trip, Seid agreed to join Hillstrom’s board, and devoted his firm’s extensive resources to the project. In turn, Hillstrom hired MSA to develop the franchise programs for both Uganda and Kenya, as well as other franchise systems that may be developed for other areas. “We will also be developing the tactical components, including operating manuals, training programs, field service manuals and all of the necessary elements to ensure standards are in place,” Seid says. “This is not a social franchise, but commercial business-format franchising applied to the human condition.”
When first approached, Seid intended to do the work pro bono.
“Michael volunteered to help us,” Hillstrom says, “but we told him, ‘We expect a lot more from your firm than we could get from a volunteer.’”
The program got off to a rocky start a couple of years ago—because “I don’t have enough knowledge (of franchising) and the people I hired knew less than I did,” Hillstrom confesses—and bringing Seid aboard now is an attempt to get it back on track.
“Michael Seid is the most competent consultant I’ve ever seen in any field,” says Hillstrom, an attorney who owned a company of multi-state rehab medical practices before selling it. “His knowledge of franchising is breathtaking.”
At first, watching him work, Hillstrom admits he was concerned: “Michael doesn’t take a lot of notes,” he says. But at the end of the day, when they sat down to process what they’d seen, “he could download a lot of information” and details of what he had seen that day. “He has a tremendous capacity to retain information.”
Part of the information processing involved trying to get a handle on how this client differs from the ones he deals with from his office in New Haven, Conn.
“With Michael’s background, this is as much like going to Mars as you can get,” Hillstrom admits.
 There are already 65 CFWshops serving families in Kenya |
No one is prepared for the poverty. “The only word to describe it is squalor,” Hillstrom says. “Michael was worried about the floor getting residue from the (DDT) spraying, but there’s no floors, just dirt.” And there are no mattresses, either. Families sleep on those dirt floors.
But there’s also hope. There are already 65 CFWshops, two-thirds of which are medical clinics run by nurses, and one-third shops that sell medicine and other personal hygiene items. The residential spraying program is an attempt to eradicate the cause of malaria.
Seid marveled at the care the team of sprayers took with the job itself and cleaning the equipment afterward. In order for the chemical to not seep into the ground and contaminate the water—which is dirty enough on its own—the workers had to wash out the canisters without a drop of water touching the ground.
The 24 workers, dressed in jumpsuits and masks, arrived at the job site in the back of a pick-up truck that sped along at under 2 miles an hour due to the bad roads. “Sprayers work 9 to 4 for $3.50 a day, with no lunch, and they’re happy (to have the work),” Seid says. Because they can’t work during the wet season, Seid says they’re looking into alternative work so they can be employed year round.
Back in the USA
In early May, Seid and three more members from franchising’s elite—two former International Franchise Association chairmen and one upcoming one: Jim Amos of Tasti D-Lites, Sid Feltenstein, chairman of Sagittarius Brands (parent company of Captain D’s Seafood); and Steve Greenbaum, 2008 IFA chair and CEO of PostNet—will meet with Hillstrom at the foundation’s headquarters in Minneapolis to set the plan in motion.
“In 2000 when we launched the first outlet, I made the mistake of thinking I only needed to learn about public health,” Hillstrom says. But, it’s the franchising piece he believes will make it work. “Franchising can do more to save the world than anything (else) invented by man,” he says.
Why franchising works is because it sets standards, it generates economies of scale, it can be replicated rather quickly and the people running the units have an economic reason to ensure it’s successful, he points out. And, it’s all about the power of branding.
The locals Seid talked to in Africa may not have known they were discussing branding, but they understood that when customers saw the CFWshops signs, they knew the outlet could be trusted to have real medicines. They understood the value of being a brand.
And, even though the per capita income in Kenya is $30 a month, Hillstrom says people can find the money for the medicine their child needs. The problem is finding a nearby, reputable place to buy it. And, if they don’t have the money, Hillstrom and his board are looking into a third-party payer system similar to our health insurance, but funded by donations. “There’s plenty of money flowing through the system there in grants and charitable giving,” he says. The key is finding a way to channel it into growing the economy.
Hillstrom wants to get more people from franchising involved. “Let’s say we get 100 serious franchise professional involved—people like Mary Ellen Sheets (who franchised Two Men and a Truck and donated to the HealthStore Foundation after running across it on the Web)—they can really make a difference,” he says. A difference because they have the experience to mentor the people who run the HealthStore Foundation franchise programs. Part of the beauty of franchising is that it keeps people from continually reinventing the wheel.
What’s a difficult concept to grasp is that 30,000 people die a day from something that’s preventable. “You see people drinking muddy water,” Hillstrom says. “You see it and it changes you. You go away as different people. Michael has. This started out as pro bono and by the end of our time together (in Africa), he felt a personal commitment.”
Steve Greenbaum, who understands the challenges of Africa through locating franchises for PostNet in South Africa, joined the board several years ago. He was attracted by the premise: “What if the franchise model could be used to solve some of society’s problems? Not just creating money, but impacting people’s lives.”
He was in touch with Seid while he was in Africa via e-mail. “I was one of the first people he called (when he returned),” he says. And, when he saw Seid at the International Franchise Expo the next week, “I told him he looked like Moses when he came down from the mountain.”
The true impact comes with the discovery that you have the ability to do something. Perhaps, in some cases, a bit of an ego’s not a bad thing.
