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19 December 2003
Edinburgh Evening News
Sir Tom in drive to help put others on the road to success
FOR a self-confessed workaholic, it's surprising to hear Sir Tom Farmer say people 'should work to live, not live to work'.

But it's not just a throwaway line from a multi-millionaire with enough money to need never work again.

Instead, it's part of the philosophy behind the latest venture from the Leith -born businessman, who over 30 years worked day and night to build Kwik-Fit into the biggest automotive repair business in the world, before selling it for GBP 1.2 billion to Ford Motors in 1999.

The latest enterprise - one of about 25 he's currently involved in - is, like his former baby, based on car repair centres, and in particular on tyres, wheels and exhausts.

After serving as a director with Ford for two years after selling Kwik-Fit, the final divorce from his creation came in August 2001 when Ford sold the chain on for just GBP 330 million.

For a man who confidently claims to have sold more exhausts than probably anyone else in the world, it's hardly surprising any new venture would involve motor repair.

Such is his association with the replacement parts business, he even has a lamp in his office crafted from an exhaust pipe.

Sir Tom is still driven by the commercial goal of profit and the buzz of involvement in an industry that's been the focal point of his business life. But if there's any place for a smidgen of benevolence in the cut-throat world of commerce, it might just be through Farmer Autocare.

'Everyday we hear about how we need more business start-ups,' Sir Tom says. 'But starting your own business is a big step. It takes a lot of courage, especially if you have a good job. And that's before making the financial commitment.'

Because of the support package on offer, Sir Tom feels what he's offering is possibly the next best thing to a one-horse race. He says: 'It's great to encourage people to start their own business but many are sent off to some business adviser who teaches them a lot of theory. Fine, but people need to know there's help and support available. They need to know practical things, like how to handle a guy in the team that lets you down.'

Farmer Autocare is essentially a business template that people can buy into and 'co-own.' Each individual repair centre business is formed with GBP 100,000 of share capital. The co-owner invests between GBP 25,000 and GBP 45,000 in the business and becomes the managing director, leasing a fully -equipped centre from Farmer Autocare. Profits are split according to equity share.

Co-owners can buy up to three such centres. The package of support investors receive includes training, advertising and merchandising support.

Significantly, and what sets co-ownership apart from franchising, is that Farmer Autocare, as the majority owner, takes care of all the admin, wages and accounts through a central support office.

In addition, there's a guaranteed exit after four years with Sir Tom buying the business back at a value worth about four times its profits.

'What I've learned is that no matter what type of advertising or marketing you use, the success of your business will depend on the self-motivation of the people in that business,' says Sir Tom.

'One of the things that helps motivation is if the people running the business have a stake in it and are in charge of it.'

The reason the decision was taken to deal centrally with admin was to remove the time-consuming demands of increasing business paperwork, allowing co -owners to concentrate on developing their business.

Sir Tom says: 'Being in business can be a nightmare at times. Administration is a major concern.'

Having been involved in a number of organisations geared towards business start-up, such as Scottish Business in the Community and the Entrepreneurial Exchange, Sir Tom was aware of the pressures that went with starting a business.

Figures indicate that Scotland saw about 18,000 businesses launch last year. However, many firms fail to last because many owners spend too much time on admin and don't have enough left to develop the business.

Just a few weeks into the Farmer Autocare project, there are already four co -owners running their own enterprises in Edinburgh, Bathgate, Dunfermline and Glasgow with Farmer Autocare in sole charge of two more - 'at least for the present', Sir Tom says.

The idea for the co-ownership plan came after a number of his former colleagues at Kwik-Fit approached him saying they were looking to set up on their own and would he be interested.

He says: 'I said I would, but that I was never going to put myself back in the position where I was responsible for the day-to-day running of things.'

Sir Tom says the reason for Farmer Autocare retaining majority ownership is because it means it can control the operational parameters better than if a bigger share was granted. Co-owners will also be limited to a maximum of three outlets. Sir Tom says: 'Our experience and knowledge of the business shows that if you go above that number it puts a lot more pressure on the running of the business and you need to bring in more people.'

Potential co-owners who just want to hand over the cash without the personal involvement investment will be rejected. Equally, Sir Tom's not after people who want to devote all their time to the business.

'I've got few regrets but one thing I think is that if I'd planned my time better instead of working all the time, I might have had time to stop and smell the flowers,' he says.

'I want people in this who want to build a good business but at the same time have a good quality of life. The reality is that people should work to live, not live to work.'

The creation of Farmer Autocare will pit the new centres up against Kwik-Fit and its ilk.

Targets for a specific number of outlets over a certain timespan have not been set, says Sir Tom.

'We don't want to create a massive group. If I'd wanted that there's a dozen companies out there that I could have bought. I simply wanted to do something with people running their own business,' he explains.

Each centre is seen as a place with a core team of about six or seven people where that team gets the chance to develop good interpersonal and on-going relationships with customers and suppliers.

Sir Tom says: 'It's like going to a pub. You don't necessarily go there because it serves the best beer. Much of the beer will be the same as you get in any pub. You go there because of the ambience, the atmosphere, and because you like the people who'll be there.

'Our tyres are the same as anyone else's, so the difference has to come from some other source.'

A further innovation Farmer Autocare has deployed is the inclusion as standard in each centre of a cafe area with computers and plug-ins for laptops, so customers can carry on working or enjoy surfing the net while their cars are repaired.

Sir Tom sees Farmer Autocare as an innovation in the car repair sector. But more importantly, he sees it as a major innovation in business start-up and sustainability.

JIM STANTON



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