The business model of franchising is phenomenal. Although franchise ownership is not for everyone, for those that align their skill sets with the right franchise offering, being the owner of the most profitable franchise usually beats working for someone else. Here are five things that make franchising fantastic.
1. Proven Model
When you purchase a franchise, the thing that you are really purchasing is a business model. You are purchasing the rights to use someone else’s idea. This someone (the franchisor) has put their idea into an organized, easy to follow operations manual. In other words, you are replicating the franchisor’s business. The obvious advantage is that you don’t have to “invent” anything of your own to start a business. It’s already been invented.
2. Formal Training
Once you have written a check for the Franchise Fee, and signed the franchise agreement, you are officially a franchisee. It is now on the franchisor to teach you their system, in a formal fashion. Training can last from three days all the way up to two weeks. It depends on how complex the franchise concept is.
You’ll be trained on the use of their computers and software, their operational procedures, marketing and advertising, human resources, and sales. Some franchisors even have online training modules set up, so that you actually can start training from home, a few weeks before you head to their corporate headquarters.
3. Marketing systems
Marketing techniques employed by franchisors, are usually top notch. That is because part of the franchise development process includes testing. Some franchise offerings end up using direct mail marketing to get customers, while some may find that radio advertising proves to be the most effective way to find and retain customers.
The point is this: You are not the one who has to try out nine or ten different marketing ideas in order to find the one that works the best. It has been done for you already. In most cases, the franchisor knows what works. They just have to show you how to implement it.
The franchisor needs to have great technology. Twice. First of all, the franchisor must make things as efficient as possible for it’s franchisees, so they can concentrate on business growth and development, not payroll, and scheduling. Most franchisors have software programs of their own for their franchisees, who pay for them as part of their initial investment.
The franchisor must also have top notch software for their own internal operations. Things like franchisee sales figures, royalty payments, email marketing metrics and website statistics are all measured, so that management can stay on top of things, and keep the system growing.
5. The Franchisee Network
This may be the best part of the franchise business model. As you learn more and more about the franchise offering that you are interested in, you will find that the franchise director or salesperson can only go so far in dispensing pertinent information about the franchise opportunity. It will be time for you to reach out and talk to the network of franchise owners who are in the business that you may want to get into yourself.
You should call 10-15 franchisees of the franchise concept you are interested in. You will be able to get a lot of your questions answered, but it gets better. Undoubtedly, you will find some commonality with a couple of them. These are the franchisees that have given you permission to call them back if you happen to have more questions before you make your decision. Hold on to these names and numbers. These will be the folks you call after you become a franchisee. You could be calling them to get some much needed advice during those challenging start-up months.
These people will usually go out of their way to help you. They probably had similar help during their own start-up phase, and are more than willing to give it back. Sometimes, close friendships even emerge. After all, they probably went into a business of their own for some of the same reasons that you are thinking of doing so. Talk about a natural bond.
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About the Author: Joel Libava is President and Life Changer of Franchise Selection Specialists. He blogs at The Franchise King Blog.