Kall Kwik has been a feature on the UK high street since 1979, when it was founded by Moshe Gerstenhaber after he secured the master franchise from US franchise network Kwik Kopy (he called it Kall Kwik because someone was already using the Kwik Kopy name in the UK). In 1999, Kall Kwik approached Prontaprint owner Adare to buy its arch-rival, but the offer was rejected. Instead Adare decided to buy Kall Kwik and Toplis became managing director of On Demand Communications (ODC), the umbrella company Adare set up to oversee the two franchises.

However, after Adare sold ODC to Boundary Capital in 2007, within a few short years, the former super brand was rapidly becoming a thoroughly disenfranchised franchise network – resulting in a flurry of threatened court cases and breach of contract claims and a mass exodus of franchisees. And then, in 2011, the brand suffered the ignominy of On Demand Communications being placed into administration, leaving its franchisees in limbo.

So it’s safe to say that when it emerged that Toplis, by then managing director and majority shareholder of multi-brand franchise group, The Bardon Group, was to take on the master Kall Kwik franchise – almost a decade after he left on a high – then the remaining, embattled franchisees probably breathed a sigh of relief.

But for Toplis it was just the beginning of a process to try to help the centre owners, as they’re now known, to rebuild the brand, reshape the franchise model and create a network that can embrace the future with confidence rather than simply reminisce about past glories.

Darryl Danielli Why did you leave Kall Kwik in the first place back in 2002?

Nigel Toplis Things got a bit hairy with Adare. They owned a lot of different print businesses and they seemed to want every business to look the same. I felt that they were trying to run the business as a conglomerate and didn’t recognise the nuances of running a franchise.

How do you mean?

I don’t think that they realised that every franchise owner – whether Kall Kwik or Prontaprint, whether they turned over a £100,000 or £1m – is the managing director of their own company and they need the respect of that position and need to be treated as owners, not employees. So we had a bit of an impasse towards the end of 2002.

Is that when you left?

The chairman of Recognition Express, a business that had been running a similar amount of time in a similar market, approached me. The owner and managing director had been diagnosed with terminal cancer and he had asked the chairman to find someone to take over the business. So everything sort of fell into place. I was fed up dealing with an overseas corporate mentality, who I felt didn’t understand the business and I had been offered the chance to run a business that was similar to Kall Kwik, but needed some re-engineering work – a bit like Kall Kwik did when I joined.

And that became the Bardon Group?

Basically, yes. So today the group is the 100% owner of Kall Kwik UK master licence and Recognition Express. We own 75% of school education franchise ComputerXplorers, and 50% of clothing alterations franchise The Zip Yard. And then on top of that we have a 50% stake in a badges and sign manufacturing business, Retrade, which produces products for the likes of McDonalds and British Airways as well as being a bit of a hub facility for Recognition Express franchisees.

And who owns Bardon?

I have a majority stake and my finance director Laurence Bagley owns the rest.

So jumping back a decade or so, were you disappointed that rather than acquiring your biggest rival, they effectively acquired you?

Yes and no. Moshe Gerstenhaber owned the Kall Kwik business, but we ran it – he was a catalyst of ideas, but unfortunately he used to catalyse about 36 times a day – which could be a nightmare. He was a great guy and I love him dearly, but I think he just got to the point where he felt he had done all he could with the business – and, I think, deep down he did not want to be associated with Prontaprint. As far as he was concerned they were the enemy, they always had been and always would be. Troels [Henriksen, Toplis’s joint managing director prior to Adare acquiring it] and I, though, had no qualms about it at the time: they were a good brand – we wanted to buy them after all. But Moshe decided to sell, and it was his decision to make.

You left Kall Kwik in 2002; did you still follow the business through its subsequent troubles?

The business was bought and sold many times after I left. But I stayed in touch with my friends who were in the business and I looked on aghast at how a fantastic, iconic brand was having its legs cut off.

I think it’s safe to say that by 2010 the relationship between Kall Kwik and Prontaprint, and ODC was pretty terminal.

You could say that, I think some people likened it to corporate rape. It’s difficult for me because a lot of what I heard was secondhand.

Like what?

That it was all about the bottom line, stripping our costs wherever possible, not having business development executives, not doing any marketing, whatever it took to save and make money – eventually they started losing centres.

How many Kall Kwik centres were there at its peak?

I think when I left there were around 170 shops, give or take, and we had several that were turning over more than a £1m.

So how did you get involved again?

I got a call from the Americans [Kwik Kopy Worldwide] around 2008 or 2009 to meet with one of the guys that was running ODC here at the time to try and help, but it was clear that they didn’t understand the business. The problem was that they saw it as a printing business that had a number of outlets. They didn’t see it as a franchise and there were horrible stories flying around about rebate schemes with suppliers. Hand on heart, I never did that. I didn’t want a cut of what the suppliers were getting. Yes, I wanted them to sponsor our annual conference, but we took no rebates from the kit and consumable suppliers. But afterwards there were rebates all over the place.

Are rebates common practice in franchising?

The franchise model is very simple: you pay me a percentage of turnover and for that I supply a range of services. Part of that might be that I negotiate a preferential price with suppliers. It may or may not be the best rate, and you might be able to do better – but it’s a line in the sand. For example, if the franchisee is smart then they won’t invest in kit in June, they’ll wait until the vendor’s year-end – because then the vendors are desperate to hit their targets. But the guide price the franchisor negotiates on behalf of its franchisees is just that, a guide. Nothing more, nothing less.

On the subject of equipment and suppliers, is it true that as part of the new Kall Kwik model you would discourage new owners from having any printing kit and that you suggest they shouldn’t print anything, but rather act as more of a mini print manager?

That’s not quite right. I would tell them to have virtually no equipment. I would recommend that a new owner takes a 65m² high-street unit, with some, what I would call, short-run, on demand, high-margin production equipment. Say a wide-format printer, around the 1m wide mark, a digital press, some finishing equipment and a web-to-print platform and then a network of two or three good litho printers and higher volume digital printers – and ideally a couple of those would be other Kall Kwiks.

So basically a hub and spoke model?

Yes, not every centre needs a five-colour Speedmaster or an iGen3. Some have that sort of set-up and do very well, but a new centre just doesn’t need it anymore.

Are there any Kall Kwik centres that have no equipment at all then?

No. It’s very difficult to remove something you already have, and if you’ve finished paying for it then why not keep it. Also you need something for the urgent jobs when people need something straight away. But you don’t need much. People talk about having an 80% gross margin on work they print themselves; net margin is what you need to focus on. If you have more machines, you have more space, more rates, more power and more people. All of a sudden you have 15% net margin at best, but if you can outsource it then while your gross margin is lower, your net margin, the important one, can be significantly higher.

And if you get to the point where you’re outsourcing a lot of a certain type of work…

Then you buy in the best kit you can afford to produce it and you’re rocking and rolling.

Do you think the industry changed much in the decade you were away?

Nothing had changed, to my mind at least.

So why come back?

I had a call from the Americans in late 2011 saying that the administrators were on the verge of being appointed to ODC. They asked if I would pop along to a meeting and represent them and find out what was going on. So I went along to the meeting with Delight, Shyster and Rip-off or whatever they were called and the ODC management team and we talked about the business. 

Were they trying to sell the business as a solvent sale at this stage?

Yes. Although God knows how solvent they were – the banks were in for millions. I said the Americans might be interested in buying, but we looked at the cost base and I quickly realised that with all the corporate staff, it just wouldn’t have worked. I suggested that we might be able to do a deal with some of the franchisees, but they said I couldn’t talk to them. Long story short: I went back to the Americans and said that they have two options: It was clear that the bad feeling from the Kall Kwik franchisees ran so deep, from feeling that they hadn’t been supported by ODC and had been screwed again and again that they could either sell the brand to each individual owner for a one-off fee or go in and offer a licence model rather than franchise.

What’s the difference?

You have the licence to use the brand and we would do a select number of things to support the licensee. The easiest way to explain it is that the franchise model is á la carte and the licence model is table d’hôte.

So you bought the Kall Kwik business out of administration?

Not exactly, because the other important thing is that the administrator didn’t realise that it couldn’t actually sell the Kall Kwik brand, because they didn’t own the brand – the Americans owned it. So when I told them this there was a lot of scurrying around. And by this stage I was three days away from going to South Africa for a month, so the deal was that I would put it the Kall Kwik centre owners to see if they wanted to go with the licence model – because I wasn’t going to take on anything until I talked to the centre owners.

But did you have to buy anything anyway, could you not just do a deal with the American owners?

That’s what I had to do, I bought it from the US not the administrator. So I called a meeting of the centre owners.

Were you not interested in Prontaprint too?

Not in the slightest. We could have done it – but just didn’t want to. If you cut me in half it would say Kall Kwik right though the middle.

How many Kall Kwik centres were there at this point?

I think almost 60. And virtually all of them turned up to the Hilton in Derby to meet with me, Sandra Fitzgerald [Bardon’s development director] who left Kall Kwik about a year after me, Jim Crichton, who was still with Kall Kwik then, and my finance director [and business partner] Laurence. We had lots of reminiscing about the old days, which was great, but I explained that if we were going to run the business there would need to be a new proposition. So I explained the licence proposition and told them that I couldn’t do it unless they wanted me to do it. I said they could have as much time as they needed to decide and they came back after 15 minutes and said yes, which I have to say was very emotional.

Presumably you didn’t tell the Americans that the support was that unequivocal – if you were still negotiating a deal?

They were absolutely fine. I’ve known them for 20 years and all they wanted was for the brand to survive and for them to be paid their outstanding debt, because they had been screwed royally too. It worked for everyone: it worked for the US, it worked for the franchisees and it worked for us too – although we probably pay the US too much, but then I would say that. Of course, the table d’hôte has been extended so we deliver far more now than we said we would, but that’s what we do.

So is it almost a franchise model again?

In all bar the fee, it probably is.

Is the term ‘franchisee’ now almost toxic for the centre owners?

The emotional distress that was caused in the previous eight to 10 years before we got involved meant that they probably don’t want to consider encouraging that term again. They’re all called ‘centre owners’ now, but in effect we do provide a level of support that is probably equivalent to a franchise, but for a smaller fee. I have to say, though, and this proves that out of adversity comes real gain, the cooperation between centre owners is the best it has ever been.

Is that because they all had a common hate figure, ODC, and that galvanised them?

Forget about the hate figures of the past, I’m talking about now. Because even in the darkest days they didn’t really work together, they just hated together. Now we have centre owners that are prepared to do things on behalf of the network as whole and not get paid for it. 

Perhaps that’s also the benefit of a smaller network?

I think there are combinations of factors that have created this cooperative soup: the shared history, the new start, the lower licence fee and also the acknowledgement that together we are stronger.

Did you lose any centres immediately after taking on the network?

Two or three were on the edge of bankruptcy, so they went, and then we lost another two or three who basically just didn’t like me – I can’t believe it myself [laughs], but there you go. But we haven’t lost a single centre out of those that signed up three years ago.

Have you added any centres?

Not yet. We’ve had one resale and we’ll probably have a couple more. But we’re in a Catch-22 when it comes to signing up new licencees: because the fee is much lower we don’t have the cash to recruit people. You have to be spending a £100,000 a year to recruit people and we don’t have that – so it’s very difficult. That’s not to say we don’t want to recruit, in the old days it was £180,000 to become a franchisee, the deal today is £55,000 and a shop fit – so it’s very attractive.

But it’s more of a passive sell now?

It is. We were very clear from day one that what we wanted to do was stabilise the network and then after that start to achieve organic growth, because we want the brand to be number one in the market. We want the business to get back to the era when it was dynamic and prepared to take on new ideas, and if we can take on more licencees, then all the better. But we have to sensible and work within our budgets, because we have a duty of care to our current centre owners.

You have 50 centres now, but when you took on the business you mentioned you were targeting to grow 100 centres?

Yes, but well do it organically – there’s no rush.

Do you think that part of the problem is that in its darkest days the Kall Kwik brand had become tainted?

Throughout all of even the darkest days, before I came back, I think the one thing that remained constant was the strength of the brand in the eyes of its customers, and that was due to all of the hard work that everyone put in – especially the centre owners, in the previous years. Even in the ‘toxic’ years, it was only ever toxic internally. Yes, a lot of centres left, but the brand remained powerful. It’s still a brand that a lot of people have heard of, even if they have no interest in printing.

You mentioned earlier that the industry didn’t change much in the decade you were away, have the centres changed much in that time?

There’s no doubt that the centres have and are changing more than the general market. A number have made significant strategic changes, some have moved out of ‘wet’ print completely, one has replaced it with wide-format for example, others have invested in web design, email marketing as well or other new revenue streams – they’re all looking at adding new revenue streams. I would love for all of our centres to have multiple revenue streams beyond their traditional print.

What sort of areas?

We’ve identified four, well three, but I’ll move on to the fourth. The first is wide-format: the market is huge and still untapped to a degree. Second, email marketing, where a centre designs, manages the data and then sends the messaging and then does something else, perhaps a follow-up print mailing. The third area is web design, there more than 4m small firms in the UK, that’s our market, and a lot of them have websites that just aren’t fit for purpose. Our centre owners don’t just understand print, they understand branding and how our customers can best market and communicate their brands – we’re in the perfect position to help them do that in print, online and via email.

What’s the fourth thing?

Web-to-print (W2P). I read something recently that said that over 70% of printers do not offer W2P. So we certainly want that and we’ve worked with Infigo Catfish to offer that to the Kall Kwik network.

So it’s an option for the owners?

Exactly that. We’ve been working with Infigo for almost a year to develop a product that is cost beneficial to owners. We presented it to our centre owners last month and of those there, 90% signed up on the day. That’s the perfect example of centre owners being willing to embrace change.

But if the centres are offering W2P, do they really need to be on the expensive high street anymore?

The value of being on the high street is visibility.

Even nowadays, when the centres’ customers are largely B2B and things like parking are a nightmare?

Doesn’t matter – it’s about visibility, not accessibility. When someone rings you up from Kall Kwik you know who they are, you know it’s fellow local business. It is a point of debate though, I don’t deny it – there are people who say they can save thousands by moving to an industrial estate.

How many are on an industrial estate?

Very few.

Does it tend to be the biggest ones?

Not necessarily, our biggest centre is still St James on Pall Mall – the highest of high streets.

Presumably it’s not just location, location, location though - what makes a good centre owner?

They have to be a people person, so probably not an accountant, but probably not a salesperson other. It needs to someone who is organised, disciplined and focused. I’m not saying obsequious, but someone who can follow a system and understand its value. They need to be active.

How do you mean?

The more actively you promote your business, the more people you see. The more people you see, the more business you’re going to get. It’s fairly straightforward.

What are the biggest challenges and opportunities facing the centres?

The centres are by and large at their fighting weight, so it’s very difficult for them to cut costs. So growth has got to be organic, and that has to come from investing intellectually in additional revenue streams, wide-format, web design, W2P or email marketing. So the challenge is how to make that intellectual investment – the financial investment is relatively small, but the cultural shift required can be significant.

Any other challenges?

Developing key accounts is another, and I have written a book on this topic. In order to develop your key accounts you have to spend a lot of time looking at what your customers do, when they do it, what they buy from you, what do they buy from other people and what their challenges are. You need to spend a lot of time understanding your customers, and time, of course, time is the scarcest resource in any business. If you do not seek to build relationships with your customers, then you’re vulnerable. So your time needs to be spent at the top of the pyramid, but you can’t ignore the bottom of the pyramid – because it’s quite big, funnily enough.

So if you’ve written a book on the subject, what’s the best way to develop accounts?

A prospect is someone who has never ordered from you before, if they order from you once then they’re a customer, but they have no loyalty to you. So what you want is that customer to order two or three times from you, and they turn into client. That client then becomes a ‘labrador’, and you keep tickling them to make them happy, then that labrador becomes ‘friend’ – and when they become a friend, things like price are less important. But what you really want is to turn that friend into a ‘lover’, because then they’re for life. It’s clichéd, but it works for me.

Final question, what’s been your proudest Kall Kwik achievement?

It’s probably the fact that despite all the trials and tribulations we’ve had, three centres have celebrated their 30th anniversaries, one its 25th and there’s another coming up. I feel very privileged to be running a brand that generates that kind of loyalty.