In over 30 years of franchise consultant experience, people frequently ask me, “Why does one franchise sales program flourish while another franchise sales program disappoints?”
There are many causes for succeeding or failing in your franchise sales program.
In this franchise consultant blog, I will address another Frequently Asked Question about franchise sales programs and franchise consultants:
Q. How do you sell franchises?
A. Usually, you have three choices for the party responsible for your franchise sales program:
- Designating one or more of the owners of the franchisor as the franchise sales team,
- Retaining an outside company or sales person to perform your franchise sales, or
- Appointing or hiring a staff person to perform inside franchise sales.
There are pluses and minuses to each of these alternatives for your franchise sales program. At the outset of your franchise sales program, if the owners of your business are willing and able to perform the franchise sales function, they are often the best solution for the following reasons.
- Being the people most knowledgeable about the franchise company may put them in the best position to sell it.
- In the beginning of franchise operations, the franchisor’s owners are essentially convincing others to invest in them. Personally filling the franchise sales role puts these owners in the best position to earn the prospective franchisees’ trust and respect.
- Unless its first few franchisees are successful, it is virtually impossible for a franchisor to sell more franchises. By allowing the franchisor’s owners to spend more time with prospective franchisees, they can better judge if these are top quality candidates.
- This option keeps your franchise sales costs lowest at the time when the company has little revenues.
- Unlike many outside brokers, the owners can concentrate on franchise sales for their company alone.
If the owners of the franchise company are unwilling or unable to perform the franchise sales function, the franchisor can always bring in an inside franchise sales person or outside franchise sales broker.
(More in my next blog)
In my over three decades as a franchise consultant, I am often asked “What makes one franchise program succeed while another franchise doesn’t?” Rarely is there a single reason for success or failure in a franchise program. In my franchise consultant blogs, I will examine some of the factors that can help you succeed in your franchise program.
In this month’s franchise consultant blog, I will continue tackling franchising FAQs:
Q. Why can’t I just get somebody else’s franchise legal documents and substitute my company name?
A. You certainly can do so. However, as most experienced franchise consultants will tell you, what works for one franchisor does not necessarily work for another. There are a number of business decisions (not necessarily legal issues) that must be addressed when developing a franchise program. Carefully working through these issues results in a franchise program that is both more lucrative and easier to attract qualified franchisees. The following are just a few of these issues:
- Size of the franchise territory
- Amount of the Initial Franchise Fee
- Amount, frequency and basis for determining the royalty or service fee
- Initial training program provided to franchisees
- Mandatory/optional purchases from the franchisor
- Franchise growth strategy
A seasoned franchise consultant can guide you in making the best possible decisions for your particular business and goals.
Remember, depending upon the specifics of your franchise program and the fees charged by the particular franchise consultant, you can easily recoup your investment in developing your franchise program with the Initial Franchise Fee and first year of royalties from the sale of only one franchise.
Q. How large is franchising?
A. Recent industry estimates are that franchising accounts for nearly 50% of the U.S. retail economy.
(More in my next blog)
In this blog, I will address more of the Frequently Asked Questions about franchise programs:
Q. What makes National Franchise Associates different from other franchise consulting firms?
A. At NFA, we approach franchise consulting by looking at developing a franchise program from both the franchisor’s and the franchisee’s point of view. This approach allows us to provide our clients with the best possible franchise consulting service through:
- Broad franchise consulting experience that results in workable franchise programs
- Over three decades of proven expertise in franchise consulting and the development of successful franchise programs
- Offering our franchise consulting clients substantially lower fees
- Developing franchise programs tailored to the specific franchisor’s strengths and market niche
- Creating franchise programs with built-in advantages over existing competitors
- Knowing what other franchise companies have found successful, saving you valuable time and eliminating many potentially serious mistakes
- An integrated approach that results in a franchise program that meets your goals and needs
- Offering on-going franchise consulting support to new franchisors
Q. How much time will it take to put together a franchise program?
A. Again, NFA offers you flexibility in this area, and the answer depends upon your needs and time frame. Developing a franchise program tailored to you and your company requires input from you. If you have more time to devote to the franchise consulting project each week, we can complete the work in a few months. We can also lengthen the target completion date if you have limited time available to work on it.