In many ways, a franchise gives you the best of all worlds. You’ve got amazing potential for expansion and profit on one hand, and the ability to create a wholly ethical series of working relationships on the other.
But when you’re figuring out how to start your own franchise business you’ll have a whole new set of challenges to overcome too. Luckily, there are a few ways you can hack the process to make it easier for yourself in the future…
1) Work hard and be resilient – because it’s not going to be easy
This is perhaps the most difficult thing for many entrepreneurs to get their heads around when starting their own franchise business. If you were a layman listening to a lazy description of the franchise business model you might end up with the idea that all you need to do as the franchisor is sit back and let the money roll in. The people you’ve employed are going to be doing all of the hard work. You’re in charge of counting the dough.
Companies started by entrepreneurs who have this attitude will not succeed.
It’s going to take a whole lot of hard work to make it happen, and you’re not going to become the next McDonald’s overnight. Even McDonald’s didn’t become McDonald’s overnight. It took them many, many years of iterations, trials, errors, tests and tests more tests until they reached their current size and format.
Likewise, your company is not going to instantly be its best possible self as soon as you start trading. You’re going to be working very hard and for incredibly long hours and in many (hopefully small) ways you are going to fail. Most likely, you’re going to fail often.
These failures aren’t going to be death blows to your company. But they are going to be problems you need to surmount. This means you need to cultivate a resilient attitude.
The old adage “fall seven times and stand up eight” is going to be one you’ll live by.
2) Hire the right people – support them and they’ll make you happy
As in any business, hiring the right people is the difference between success and failure. When starting your own franchise this is truer than ever.
However, even though it might sound like the opposite of hard-and-fast business advice, there’s a certain goal that it can help you to consider when hiring your team:
Your happiness. Your team’s happiness. Your franchisees’. Your business partner’s. This flies in the face of lots of old-school ways of thinking about the employer-employee relationship, but the benefits are there to be seen. Hiring hard-working, dedicated people who will do their jobs willingly and do them right is going to:
- Give you a smart, lean company that has the ability and drive to grow and adapt
- From a purely selfish perspective, make things a whole lot easier for you! Your team is on the same page as you are, working towards the same goal
And the secret behind building a team of hard-working, dedicated and willing people?
Making sure that they’re happy. In general, this means that they’re treated as professionals no matter what their job role, that they get what they need from their job and that you provide as much support as you can to make that job as efficient and easy as possible.
3) Let everyone do the thing they’re the expert in
One of the keys to building an efficient franchise is making sure that each member of your team is doing the thing that they’re the expert in. This means that task, whatever it is, gets done as well and as quickly as it can be.
The most obvious example would be that your frontline cleaner, chef or driver’s time is best spent doing the cleaning, cooking or driving that they are most experienced and skilled in. Any time they spend, for example, learning how to build a website or market their own ability to clean, cook or drive is time they’re not spending effectively. A person who’s an expert in marketing should be doing the marketing.
It sounds all too obvious when laid out with such a simple example, but this is one of the key strengths of the franchise business model. Consider the franchisor-franchisee relationship in this light:
In any franchise network, the effectiveness of these relationships is a critical indicator of how likely a business is to succeed. Your franchisees’ contribution of expertise here are the skills, dedication, hard-working attitude and motivation required to make their franchise a success. But you’re going to need to provide the expertise in other areas to help them do it.
Because make no mistake, this is a two-way street. As the franchisor you need to bring to the table:
- The business concept and Unique Selling Points
- The processes which you’ve developed which make your franchise the best in its field
- An established brand name and reputation
- All of the trademarks
- Financial planning or accounting support
- Centralised customer support and communication handling
Perhaps most importantly, you’re also going to provide two further things:
- Training – so that everyone knows how to deliver your high-quality services
- Marketing – so that they have customers to deliver those services to
This means you need to…
4) Figure out how to market your franchise
This is one of the two big areas of support that you’re going to need to provide for your franchisees in order that they can keep on delivering the best services. Returning once again to our theme of everyone being free to do the thing that they’re the expert at, don’t allow your individual franchisees to control their own marketing. Even if they do have the training and years of experience in marketing which could qualify them as an “expert”, any time they spend selling is still time taken away from concentrating on delivering their services.
You, the franchisor, are going to be handling your franchise marketing. You’re going to be responsible for finding customers for your franchisees – whether this is drawing foot traffic to their store or setting up appointments for in-home service delivery – so they don’t have to.
To do this, you’ll need to identify the marketing channels which are most effective for your industry:
- Social media
- SEO and local search
- Pay Per Click advertising
- PR and media advertising
- Email advertising
- Trade shows
Then you need to set your marketing spend and spend it wisely on carefully targeted and powerful use of the channels your data tells you are the best for your specific services or products. This is going to help you grow your business through the acquisition of both more customers and the most talented new franchisees.
5) Ensure you’re delivering quality across your network (through training)
Of course, all of this marketing isn’t going to do you much good if your brand gets a reputation for poor service or low-quality products. One of the advantages of a franchise – that through hard work your entire company has the ability to rise very quickly – can also be a disadvantage:
Roughly put, that one rotten apple – one franchisee who fails to deliver the standard your customers expect – can quickly spoil the cart.
You need to make sure that all of your franchisees can and are delivering quality at all times. In the beginning, perhaps it might seem like you can monitor things personally, but not only is this an inefficient use of your time, it’s also going to become impossible as your company grows to the heady heights of a Subway or a Hilton Hotels & Resorts.
The key to ensuring you’re delivering quality is proper training for all of your franchisees. This training should be:
- Centralised – so you know it’s of a consistent quality itself
- Ongoing – so that your franchisees continue to improve and can stay on top of innovations in terms of technology that affects your industry, for example
- Properly assessed and tested – so you know it’s getting the message across
Don’t simply take a new franchisee’s word or trust that because of their experience they know how to meet your exacting standards. Train them and test them on that training so that you’re sure they will.
Franchisees who are properly trained and who understand the value, function and responsibilities they hold as part of the franchisor-franchisee dynamic are going to help you with one final vital part of hacking the start of your own franchise company…
6) Make sure your franchisees are compliant with your franchise agreement terms
Writing a franchise agreement is one of the most critical legal steps you need to take when starting your company. Without a firm written description of the responsibilities that you and your franchisees have towards each other, you risk the relationship becoming muddied or simply not working at all.
However, the most well-laid-out agreement in the world means nothing without the ability to enforce it. There are many systems you can use to do this, though in general carrot rather than stick should be your mantra (after all you’ve chosen the best and brightest to be your franchisees for a reason). But there’s one really difficult line to walk in the enforcement process:
How do you make sure that your franchisees are using your industry-leading processes and systems without killing the possibility of individual innovation which is another powerful advantage that the franchise model has to offer?
The key is to get all of your franchisees to come to terms with the fact that they need to accept certain things. These will include complying with your quality standards, trusting someone else with the marketing and sales, and agreeing with you on their growth and development plans, not going off in their own direction. There are a few tried and tested methods to do this:
- Group learning sessions for all of your franchisees
- Letting franchisees from different parts of your network interact with one another
- Careful selection of franchisee candidates in the first place!
Conclusion: The Advantages of the Franchise Business Model
The franchise business model offers fantastic opportunities for growth while letting you build a network of business relationships more beneficial and ethical than those offered by alternative gig economy models. A franchise business can also be self-funded right from the start.
But without hard work and the institution of the right processes from the very beginning, problems like one poorly performing franchisee or ineffective training or support provision can undermine the hard work of your entire network. This can quickly destroy the ability to work together to reach goals which couldn’t be reached alone, which is the major advantage that a franchise business model has to offer you.