The low-risk nature of the franchising model is what gives many new entrepreneurs the push to get started. However, we know that some franchise locations will flourish while others quickly wind up closed for business. While the market a franchisee is entering, as well as the effectiveness of a franchisor’s training, will have an effect on success, the main factor in a franchise location’s viability is the franchisee.
Franchises come with a set of rules and standards, but there are plenty of decisions that you, as a franchisee, must make yourself. The choices you make will mean the difference between a thriving business and a premature closing. Here are a few actions you can take to increase your chances of building a prosperous enterprise.
1. Pick a Franchise That Is Right for You
Choosing a franchise that is a good match will increase your odds of success as a franchisee. But how do you know if a franchise is right for you? Consider your existing skill set, experience, and interests. Having a background in a certain field, and investing in a franchise that supports that background, means you aren’t entering into the investment totally blind.
Franchisees typically perform better when there is less of a learning curve. Also, being passionate about the field you are working in means you are more motivated to do good work. For example, if you have years under your belt as a general contractor, then you may want to consider investing in a home improvement franchise as opposed to looking into veterinary franchise opportunities.
Be sure to think about more than the big picture, however. Keep in mind the day-to-day tasks that you would need to perform. You may love painting homes, but that does not mean that you will enjoy the management work associated with owning a painting franchise. Ask yourself if you are prepared to tackle the training, managing, hiring, and firing of employees. Reaching out to other franchisees should offer some insight into your potential day-to-day enjoyment.
2. Reach Out to Other Franchisees
Investing in franchise opportunities can be daunting for franchise newbies and veterans alike, but you don’t have to go it alone. Along with the support provided by your franchisor, you will have the chance to connect with franchisees who have been exactly where you are now. Business owners starting their organizations from the ground up are not always gifted this opportunity.
Make the most of this discussion and go deep into your experiences, your worries, and your hopes for the future with your peers. They will likely empathize with your position and detail their own history with the franchise you are entering, offering advice that will prevent you from repeating any mistakes they may have made.
If your franchisor does not help you network with other franchisees, don’t be afraid to ask them to! Attending franchisee conferences is another great way of getting in touch with like-minded individuals. When you meet with other franchisees, ask questions such as:
- How has your experience with this franchisor been?
- What roadblocks have you encountered?
- What support were you given when you hit those roadblocks?
- What does a regular day look like for you?
- Have you recovered your initial investment?
- How much control do you have over the business?
3. Know Your Limits as a Franchisee
Being a franchisee means being your own boss — to an extent. Don’t make the mistake of entering into franchise opportunities with the idea that you can do absolutely anything with the business under a franchisor’s name. Building a franchise means making smart decisions under an established brand. This means that there are previously-set regulations in place to ensure that you don’t wander too far away from the business plan that made a franchise successful in the first place.
Have confidence in the lessons learned by your franchisor. They invested hours and resources into building a reputable brand that you can now benefit from. It is your job to preserve brand consistency in order to maintain recognition and trust from clients or customers. Understand what you can and cannot control before entering into a franchise agreement.
Much of the time, you have to purchase stock from a specified supplier. Your franchise agreement will likely outline what stock must be purchased from certain suppliers. This is because the franchisor wants to be sure that the quality of the products being offered doesn’t waver from one location to another. The name and logo of the brand will also remain unchanged. The amount of control a franchisor has over marketing will, however, differ from one business to another.
4. Keep Marketing in Mind
According to Statista, in 2020, it was estimated that there were 753,770 franchise establishments in the United States. The competition is stiff, and the way to set yourself apart is to have an effective marketing plan. Your franchisor may have the marketing essentials laid out for you, such as signs, designated fonts, local advertising materials, and more. The rest will be up to you, the franchisee.
Conduct research about your target demographic and how you can best advertise yourself to them. Ask yourself what makes your franchise unique and capitalize on that. Hire a small marketing team to assist you if you feel like you want professional input. Additionally, you want to figure out how to make your business stand out in your community. If you aren’t investing in a franchise that everyone already knows the name of, then you may need to gain the trust of your consumer base.
According to Statista, in 2020, McDonald’s was both the most famous and most lucrative franchised based in the United States. The business brought in over $93 billion in sales. Profitability follows name recognition. Show your community both who you are as a business and that you are invested in your area! Consider participating in charity events, festivals, seminars, and sponsoring local sports teams.
5. Prioritize Culture
Businesses run more efficiently when employees feel satisfaction in their jobs. Job satisfaction is largely born out of having a positive work culture. It is your job, as a franchisee, to create a professional atmosphere that people feel comfortable in and happy to return to every day. Ideally, your franchise should be a fun, encouraging, and relaxed environment. Employees will appreciate and respect you when they see that you are making an effort to create such an environment. In turn, they will be more productive.
Having a positive workplace culture often begins with the hiring process. To bypass hiring mistakes, you want to hire workers who understand your core values and are willing to operate with them in mind. Be clear about company values and goals when interviewing candidates. You can ask what they interpret them to mean and how they could fit into the equation.
When it comes time to reward employees for a job well done, you should contemplate ways to show that you appreciate them. You don’t have to give prizes or awards to recognize and incentivize good work — you simply need to consistently acknowledge that you see the effort being made.
You should also, when possible, attempt to personalize positive feedback. Not all employees will enjoy receiving public praise. Some of them simply need small comments made here and there during a one-on-one conversation to feel valued. The way that you critique your employees will also impact workplace culture. Employees who receive too much or too little criticism will ultimately feel unmotivated. Phrase critiques in an honest and respectful manner.
6. Ask for Criticism
Though giving criticism is an essential part of being a successful franchisee, you also have to be ready and eager to accept criticism. If your employees aren’t giving you feedback on your performance as a supervisor, ask for it. Let them know that you want to be the best boss possible.
After hearing any complaints or suggestions that they present, it’s important to consider which aspects of their critiques are valid, and then take action. The feeling of being ignored is what drives away hardworking staff members. Seeing you implement changes based on their feedback will signal to employees that you care about their opinions and work experience.
It’s also crucial that you ask for feedback from your franchisor. Your franchisor should give you specific insights into how your location is performing compared to other franchises under the same brand. They may be able to offer guidance to increase profitability.
Don’t forget the worth of customer criticisms, as well. Though you may have to take some with a grain of salt, customers and clients can give you an in-depth understanding of their perspectives that you may not gain elsewhere. Read online reviews and reply to them to let customers know that they have been heard.
7. Create a Work-Life Balance
All franchise opportunities are different, so there isn’t a standard for how many hours a franchisee should be dedicating to their business. Franchisees often feel guilty if they don’t think they’re devoting enough time to their investment, however, working more doesn’t always equate to being more productive.
To avoid overworking yourself, designate a specific amount of hours in your day to spend at work. Perhaps you could schedule 40 hours out of your week in order to have sufficient time for non-work-related activities. Spending time away from work not only keeps you happier and healthier but actually heightens productivity.
In today’s society, it can be tough to separate your work from the rest of your life. With so many people now working from home, this is the case more than ever before. Smartphones don’t help with the work-life separation, as everyone is easily reachable. Being a franchise owner, you can sometimes feel like you are on-call 24/7. However, the importance of your title means it’s all the more important for you to keep a clear and happy mindset — something aided with enjoyment outside of the office. When you’ve gone home for the day, try not to:
- Be on your work computer or phone
- Reply to unessential work emails
- Carry on with work projects
Make spending time with family and friends a priority. Forgetting to budget time for those you feel closest to will leave you feeling like you don’t have enough support.
8. Communicate Openly With Your Franchisor
Fruitful relationships between franchisors and franchisees are born out of open and honest communication. Regular and authentic discussions serve to improve your business in both the short and long term. Both the franchisee and franchisor benefit from this relationship being built and maintained, so don’t hesitate to get in touch with your franchisor about any questions that you have or for guidance.
If your franchisor doesn’t schedule regular meetings, feel free to continue to check in with them via phone or email. If they are local, then face-to-face meetings can build a strong bond between you and your franchisor. If you feel like your franchisor isn’t offering sufficient or frequent support, you can try communicating that to them. Speak with other franchisees to understand the level of support they are receiving.
While contemplating franchise business opportunities, ask yourself what amount of guidance you want to receive. Then, ask potential franchisors how hands-on they generally are. This way, you have a realistic expectation when going into the experience and you don’t feel surprised or let down to later learn that your franchisor doesn’t plan to meet often.
If you would prefer to be more of an entrepreneurial lone wolf, then pick franchise opportunities that leave most of the decision-making up to you. If you are investing in a franchise for the very first time, choosing an involved franchisor is probably for the best.
9. Keep an Eye on the Future
No franchise owner sees success overnight. Normally, there’s a ramp-up period within the first few months of opening your franchise where your business starts to find its legs. Don’t be discouraged by a lack of immediate attention.
Some franchisees anticipate herds of customers, simply because their business is new to the area. However, as previously discussed, you have to earn the trust of your community. By prioritizing customer service and by dedicating your time and heart to your business, you will see an increase in profits. Speaking to other franchisees prior to opening up your location can provide you with managed expectations in terms of business milestones.
When you need inspiration, find a biography of somebody that you admire. You should note not only their successes but the moments in their lives where they counted themselves as down and out. They, like you, were once at a point where they felt disheartened in their endeavors. That is the nature of humanity and that is the nature of running a business.
When you feel like you aren’t seeing big-picture progress, celebrate small victories. It can be tempting to review the last week or month and ask yourself what progress has been made only to feel defeated with the answer. But measure daily successes in a way that feels natural and genuine and you will soon find your spirits lifted. Creating a daily to-do list is a great method of keeping yourself accountable and keeping track of the progress you’ve made.
Any business needs some TLC to reach its full potential. Luckily, when you invest in a franchise, someone else has already drawn you a roadmap to success. Any gaps that they left will come with experience. To choose a franchise that will get you where you want to be, take advantage of the services offered by Franchise Recovery.
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