Dobra Franczyza #4: Rozmowa z Adamem Manikowskim, Dyrektorem Zarządzającym Żabka Polska

Hi, good morning, welcome everyone.

Yes, yes. The pillars are connected by a centric approach, and indeed they are the source of our competitive advantage. Thanks to them, we are able to develop so dynamically. But we also develop dynamically thanks to our entrepreneurs. Our model allows franchisees to effectively run their businesses. How does this happen? How do these three pillars influence it? First of all, when talking about Żabka, we think of a store, but Żabka is something more. We managed to achieve this because we transformed the format. Żabka may be 23 years old, but in the last few years we have changed a lot. Now Żabka is a place where you can not only shop, but also drink, eat, send a package, deposit or withdraw money, top up a city card. It is a kind of center where our customers can quickly and conveniently fulfill more than one need. We achieve this because every year we get closer and closer to customers. We develop by adding over 1,000 stores annually. This happens because our format, when speaking of transformation, is very flexible. Practically in places or towns where a few years ago we could not operate, now our franchisees successfully run their businesses. This is because we can tailor our offer to local needs. Let me give just a few examples of several formats we have successfully introduced recently. Among them, the store format we opened at a gas station, or the format called 'Mogli Żabka', which is opened at large events, concerts, fairs – we can be close to our customers there. Also, as an example, not long ago we created a completely unmanned store, Żabka Store. I will add that in the network we manage almost two and a half thousand planograms, which shows that our format is very flexible. When we talk about digital transformation, it is the main trigger, the main thing that allows us to implement and transform the format. And we will talk about the many tools that help the entrepreneur in daily store operations. These tools, which we have invested heavily in, are the result of the work of all technology teams – 15% of our employees work on technological solutions. And of course, the last pillar is very important: transformation of social responsibility. Looking from the perspective of our franchisees, we aim to build a transparent and responsible business, guided by franchise centricity.

First of all, we must keep in mind, when we talk about broadly understood ESG, about what you mentioned, we look through the prism of the franchisee. We pay great attention to building transparent relationships based on partnership. We do this through periodic satisfaction surveys of franchisees, but what is very important, with their participation. You mentioned the scale of our network, which is indeed large – we already have over 6,000 franchisees. The way we function, for some time we have had a Franchisee Council, elected by the franchisees. This is a group of people with whom managers and directors work directly on a daily basis on all franchise-centric solutions to build franchisee satisfaction with cooperation with us, but also to create the most transparent and friendly partner relations regarding cooperation. To build awareness of these behaviors related to ESG, they have checklists on this topic to raise awareness. And this awareness is so high that they adopt certain operational behaviors on their own. How does it look? Please remember that the closest to the customer is our franchisee. Our franchisees, local entrepreneurs, see that customers are now making very responsible choices. They more willingly choose brands and products that are health-promoting or place a strong emphasis on environmental aspects. So our franchisees see that, for example, we replace all plastic bags, that we develop the health-promoting meal category, that we invest in technological solutions that bring us closer to zero emissions. They become ambassadors of these solutions for us.

This is truly a challenge to take franchisees on this journey so that they can benefit from the network's potential to improve their financial results. You mentioned several important aspects, because it is both a communication and educational element, and an element related to the solutions we are working on. It is extremely important that all technological solutions we work on are exactly the solutions that the franchisee needs to run their business in a more competitive, easier, and simpler way. And by working with the Franchisee Council, we know that these are the solutions that franchisees need and expect. We don't have a big problem with franchisees becoming users or even ambassadors of these solutions, because we know they directly translate into benefits for franchisees. Let me give just one example: our biggest innovation, which we announced a few days ago at our annual meeting with franchisees, is the entire OptiPlant program. We are the only retail chain in Europe that has a device we provided to franchisees that allows them to easily plan all tasks in the store. This indirectly translates into the fact that to manage their business, the franchisee needs fewer hours, which also affects their well-being. In other words, franchisees can do it because there is technology, and basically they follow the guidance of what this technology tells them, but also how it improves productivity and competitiveness. And this is important because remember that around many thousands of small unaffiliated stores simply go bankrupt. In the case of Żabka, it's not one in ten stores that doesn't achieve the intended turnover.

Because our franchise offer is unique, unique on a market scale. There is no other network that on one hand democratizes franchising so much, and on the other hand provides such advanced solutions for running a business with a high guarantee of success. Rarity is a synonym for uniqueness. That's why we talk about rarity; it's hard to compare Żabka to another retail chain. We create a dimension specific only to Żabka, and that is one of our main competitive advantages and one of the main reasons why our franchisees, even those who start without prior experience, can successfully run and scale their business.

Thank you for the invitation, for the conversation. Thank you, thank you very much.