Tips for licensing your product or service outlets (Article)

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Derek Stockley is a training and performance management consultant based in Melbourne, Australia. He conducts in-house and public training courses.(Google+).

This free article examines the growing practice of licensing independent companies to market your products and services.

Ensure that the organisation behind the brand name is invisible

On the same day recently, I had two negative experiences with large Australian organisations. Both had outsourced part of their operations to independent companies.

The first situation was relatively straight forward. I went to my local Australia Post office to pick up a passport application form as Australia Post handles most passport applications. The post office is where you go to have your passport applications verified and processed. I had been to other Australia Post offices with the same enquiry. However, this particular office did not process applications. I could accept that. A larger office may have been more appropriate. However, as the official agent, I believe every post office should stock the forms. To my mind, it is a basic service for every post office. Apparently the independent operators can choose whether or not they offer this service. In this particular case, because they did not process the applications, they did not carry the forms.

The second situation concerned Telstra, Australia's largest telephone company. I had bought a mobile phone from a Telstra employee over the telephone. Part of it did not work, so I went down to my local Telstra Shop to exchange the faulty part. I had to argue the case for them to exchange it. Manager approval had to be granted (it was). The problem of course was that the Telstra Shop was an independent company, completely separate from Telstra itself. This is not apparent when you walk into the shop. Telstra signage is everywhere. The shop staff were able to access my Telstra account details. Yet they tried to argue replacing the part was not their responsibility as they were a 'separate company'.

In both of these cases, the organisations have outsourced key parts of their operations. Outsourcing can be a legitimate business approach, but it has to be done well.

In the Australia Post case, there should be minimum service level expectations of companies who operate retail outlets. To my mind, passport services are an essential service and they should be included. It may not be necessary to process applications, as this does take up resources and requires particular skills. However, every post office should be able to provide the basic information to start the process i.e. the forms that explain the specific steps required, the information needed and the support documentation to be gathered.

The Telstra case is more complex. If you present yourself as one organisation, then your internal operations should also be transparent. What Telstra needed was an internal system that handled inter-company transfers. If someone buys from one arm and returns it to another, the system should allow the necessary financial adjustment between the different companies. They should not be any discussion with the customer. It should be just done. The customer does not even need to know.


The growing practice of licensing independent companies to operate retail outlets does not have to have negative consequences for the customer. Clearly there can be operational and financial benefits for the organisation, but these should be achieved without diminishing the service levels to customers. It is just a case of ensuring the right systems are in place to allow the different parts to operate seamlessly.

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Hidden problems with outsourcing - if you think outsourcing will cure all your problems, then this free article about the hidden problems of outsourcing might save you some anguish and unanticipated costs.

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Derek Stockley conducts in-house customer service training and consulting, see customer service training and consulting.

Derek Stockley and his senior consultants conduct public training courses in both Melbourne and Sydney, Australia.

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