The Real Origin of the Franchise - Sir Harold Evans

Uploaded by TEDEducation on 26.03.2012

Quick! What's common between
beef burgers, baseball training
and auto mufflers?
Tough question. Let's ask it another way.
What's the common factor between McDonald's,
D-Bat and Meineke?
You may know the answer if, along with a Big Mac,
you've absorbed a fragment of the romantic story of Ray Kroc.
He's the salesman that created what became
the world's biggest fast food chain.
He did it by making a deal
with a couple of men called the McDonalds.
Brothers they were, owners of a small restaurant chain,
and the deal was, he could use their brand name and their methods.
Then he invited small entrepreneurs
to open McDonald's, that they'd run as operators,
with an ownership state.
Very different than the business model where Mom and Pop stores
have full ownership, but no similar support.
All the examples
in my opening question are a franchise operation.
Kroc is sometimes credited
with inventing franchising,
and so is Isaac Singer, the sewing machine magnate.
Not so. The real genesis of franchising
was not in stitches or beef,
it was in beauty.
Martha Matilda Harper
was a Canadian-born maid.
She made the beds, cleaned house, did the shopping.
In the employment of a doctor's family in Ontario,
she acquired a secret formula for shampoo,
one more scientifically based
than the quackeries advertized every day in the newspapers.
The kindly doctor also taught the maturing young woman
the elements of physiology.
Martha had a secret ambition
to go along with the secret formula:
a determination to run her own business.
By 1888, serving as a maid in Rochester, New York,
she saved enough money --
360 dollars -- to think of opening
a public hairdressing salon.
But before she could realize her dream,
two blows fell. She became sick,
and collapsed from exhaustion.
Mrs. Helen Smith, a healing practitioner
of the Christian Science faith, was summoned to her bedside.
The two women prayed, and Martha recovered.
No sooner was she better then she was told,
"Oh no, you can't rent the place you've eyed."
You see, her venture was to be the first public hairdressing salon.
A woman in business was shocking enough then.
Only 17 percent of the workforce in 1890 was female,
but a woman carrying out hairdressing
and skincare in a public place?
Why, it was sure to invite a scandal.
Martha spent some of her savings on a lawyer, and won her case.
She proudly displayed on the door
of her new her salon a photograph
of the barely five-foot Martha as Rapunzel,
with hair down to her feet, but glowing with good health.
Her sickness, too, had proved a boon.
Her ambition was now propelled
by Christian Science values.
The Harper Method, as she came to call her services,
was as much about servicing the soul
as it was about cutting hair.
In the therapeutic serenity of her salon,
she taught that every person could glow
with the kind of beauty she had,
if spiritually whole and physically obedient to what she called
"the laws of cleanliness, nourishment,
exercise and breathing."
She was very practical about it.
She even designed the first reclining shampoo chair,
though she neglected to patent the invention.
Martha's salon was a huge success.
Celebrities came from out of town
to experience the Harper Method.
They enjoyed the service so much
that they urged her to set up a salon in their cities.
And this is where Martha's ethical sense
inspired her crowning innovation.
Instead of commissioning agents, as other innovators had done,
from 1891, she installed
working-class women just like herself
in salons exactly like hers,
dedicated to her philosophy and her products.
But these new employees
were not provided a salary by Martha.
The women in what became a satellite network of 500 salons
in America, and then Europe and Central America
and Asia, actually owned the Harper's Salons.
What was good enough in the nineteenth century
for suffragette campaigners like Susan B. Anthony
and was good enough in the twentieth century
for Woodrow Wilson, Calvin and Grace Coolidge, Jacqueline Kennedy,
Helen Hayes and Ladybird Johnson
must be good enough for the rest of the world.
Today, only the Harper Method Founder's Shop
remains in Rochester, New York, but Martha's legacy is manifold.
Her health and beauty treatments have been copied,
and her business model is dominant.
In fact, half of retail sales in America
are through Martha Harper's franchising idea.
So the next time you enjoy a McDonald's hamburger
or a good night's rest at a Days Inn,
think of Martha.
Because these franchises might not be the same
without her inventing the model, over a century ago.