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Franchisee Advice

Be the Leader Your Business or Franchise Requires

For a first-time business owner there are many challenges you will need to overcome.

Chana Boucher

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Harry Welby-Cooke, leading business coach, master licensee for ActionCOACH South Africa and President of Coaches and Mentors of South Africa, offers key business advice.

What would you say a major challenge is for those who have always been in the corporate world when they suddenly become their own boss?

Generally speaking most people leaving corporate and purchasing a franchise have left a reasonably senior position. They are accustomed to managing teams of people, have worked hard and are now ‘tired’.

However, when buying or starting a business, whether a franchise or not, they almost have to start again.

There is no established well-oiled team to manage and drive results. The efforts and performance of the owner now have a direct impact on the results and more often than not, long hard hours are required.

When a person has been used to delegating tasks, it is often daunting to have to relearn a number of old skills while taking on the steep learning curve of new skills. Business ownership has almost a fantasy about it and new business owners come to the quick realisation that they were not prepared for their new venture and the fantasy is quickly broken.

What skills/knowledge do you think a first time business owner needs?

An inquisitive mind is essential. Revert to the days of being a child where you ask ‘why’ about everything. This will ensure that you open yourself up to learn the lessons you need to learn quickly and that you’re continually sharpening the saw.

An inquisitive mind will save you a lot of time and money. The roller coaster of business requires you to be able to bounce back fast and develop the ability to take things in your stride. Once you become comfortable with the ups and downs and see them as part of the course of business, rather than life threatening events, you become a more accomplished business person.

How can a potential franchisee determine whether or not the business will be worth their while financially?

First, assess the new business and make sure it’s in line with your personal goals. The bulk of our time is taken up at work so it might as well allow us the benefit of providing for us personally. Regardless of whether you have a job or choose to go into business for yourself, these are merely vehicles to allow you to achieve your life’s goals.

If the franchise business doesn’t or can’t match your personal goals then stay away. A good example of this would be a retiring, overworked and tired executive who wants to spend time with their grandchildren. But instead they buy into an 18 hour, 24 day retail business. It is flawed to start off with. Make sure the business you choose is aligned to your personal goals and has the potential to be the vehicle to achieve them.

The next step is to decide what your financial expectations are. Many new business owners take the wait and see approach where they will sacrifice personal income in the beginning and hope that it will improve later. This is very noble indeed and not necessarily incorrect to sacrifice upfront.

However, there needs to be a financial target that you’re aiming for. This target should also include a remuneration amount for the actual time and work you’ll be putting in (ie your salary) as well as a reasonable return on investment for the business based on your contribution and risk. You could take your savings and put it into other investments. So if you decide to invest in a business it needs to provide a financial return to you, in addition to your salary.

If a franchise is not achieving the results a franchisee had hoped for, what can they do to improve business?

In these situations there are three very important things to do: Talk, listen and review.

If you’re having difficulties, speak up. Speak up to the franchisor, your fellow franchisees and then seek any outside assistance you may need. Too often we struggle on our own and protect our egos instead of asking for help. Franchises are built for this so make sure you speak up. The franchisor and fellow franchisees all have a vested interest in your success, whether directly or indirectly.

The next step of listening is the most important. Often when we do eventually ask for help we don’t listen to the response. You’re not expected to know everything, no-one does and any assistance may be valuable. Listen to the input you’re receiving and see where this may be able to assist you in correcting what’s wrong and strengthening what’s right. Make sure you focus on both – improving the weaknesses and maximising the strengths.

Lastly, review everything.

Start by working through the operations manual of the franchise and then move onto all areas of the business. There are always areas that we neglect and don’t notice and small tweaks here are often all that is required to make a big impact.

How important is it for the franchise owner to be able to manage other people?

Managing people often starts with managing oneself. Herein lies the root of a number of problems. Often business owners fall into the trap of either not leading by example or not holding staff accountable because they themselves aren’t accountable to a higher level of commitment.

Staff will require management as well as leadership and this cannot be avoided. If you yourself are not the best manager or leader you will need to hone these skills. You can also buffer your inexperience or inabilities by hiring someone who is a natural manager, and delegating the management and leadership, together with sound reporting systems. The reality is, however, that you would still need to manage and lead the senior staff you’ve hired in these roles so it never escapes you.

How much of the franchise owner’s time should be dedicated to working ‘on the business’ as opposed to ‘in the business’?

In the beginning almost everything seems new and therefore it’s quite easy to get overwhelmed and default to 110% ‘in’ the business. However, one should aim for a minimum of 20% (or one day of a five day working week) to work ‘on’ the business. This could be split over the course of the week and will allow you to set a foundation of quality time leading and managing the business. In the medium term the target should be a 50/50 split between direct involvement and taking the business forward to ultimately reaching a point of 80% of one’s time being used working ‘on’ the business.

What are some of the ways franchise owners can overcome the challenge of rising costs and business expenses to remain profitable?

Play the game. Business is a game and although it is a relatively simple one it is not always easy. The rules change and there are a number of factors that influence your performance and success. Part of playing the game is first understanding it and then testing where the limits may be. Always keep a close eye on the financial numbers and review these constantly. Renegotiate consistently with suppliers to ensure you’re getting the best deal and shop around. I don’t recommend jumping around from supplier to supplier but keep up-to-date with what’s happening in the market.

Don’t hire more people to fix performance issues. Rather focus on ensuring performance first from those you have. More staff come with more management, more time and more money requirements and the problem normally lies with the effectiveness and quality of staff and not the quantity. Benchmark your numbers with other franchisees in your franchise as well as industry norms to assess where you may be overspending or where better and more effective ways of doings things already exist.

Business is not about reinventing the wheel. The principles are the same and the more you keep focused on the basics, the better. You never graduate in business beyond the need for a focus on the basics.

What are some of the most important considerations that should get the business owner’s attention on a daily basis?

Testing and measuring as much as possible. Business owners often lack the decisiveness to make informed and quick decisions mostly due to the lack of accurate information about the current state of their business. Reviewing numbers and statistics across all aspects of the business on a regular basis is imperative to its success. The more you know about your business, your clients, your staff, your suppliers, your marketing, your finances etc, the better and faster decisions you can make to take your business forward.

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Franchisee Advice

Develop Digital Marketing Competency In 3 Simple Steps

Conquering the digital revolution needn’t be daunting. Polish up your tech skills and watch your digital marketing prowess increase throughout your franchise.

Diana Albertyn

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As a franchisor, digital marketing may be proving to be a challenge due to the unique structuring of the business.

“The very nature of franchises is ‘structured’, however, when it comes to marketing, that structure often lacks,” says Marcela De Vivo, Founder and CEO of Gryffin Media.

Franchisors and franchisees often struggle to reach common ground when looking to achieve different marketing goals. While the franchisor needs to control the brand in its entirety, the franchisee wants to market their business using particular strategies suited to their location.

Research has found that smartphones are the biggest influencers of 82% of users when they make their in-store purchase decisions while. It’s for this reason that the importance of digital marketing for franchises has increased.

Here’s how to harness its power of influence, amplify foot traffic and solidify brand loyalty:

1. Recruit digital natives and early adopters

As much as you’re the leader of your franchise network, there are franchisees in your chain you could learn from. The global increase in millennial franchise owners means it is highly likely that you’ll be able to identify early digital adopters within your franchise network.

“The best people to learn from are those who have been in your shoes before,” says Matt Forman of the Franchise Centre at Griffith University.

“Encourage and support their efforts and use them as case studies to demonstrate to the rest of your franchisees the value of digital marketing, and how to do it right.”

2. Invest in training your team

“Each digital competency level requires more education and resources in order to integrate digital marketing with your physical stores,” says Forman. For this reason, regularly investing in continuous training for your team so as to ensure they keep abreast of any new and emerging trends.

Proactivity and adapting to the constantly evolving digital landscape led KFC to open a LinkedIn account for its founder and mascot Colonel Sanders. KFC’s out of the box tactic is a fresh approach to what has long been considered a B2B platform, under-utilised as a B2C platform.

3. Apply custom targeting techniques

The discovery of new and small businesses is being fuelled by Google searches, social media and online reviews, making these platforms a goldmine of invaluable tools.

Leveraging certain custom targeting techniques like easily searchable keywords and exposure on other reputable and high-traffic websites, gives your franchise’s digital marketing efforts a boost. This results in an effective campaign, favourable reviews and meaningful and lasting interactions with consumers “whether it’s a reply to a Facebook comment or a retweet,” says Entrepreneur’s Emily Conklin.

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Franchisee Advice

How To Hire Skilled Workers For Your Franchise

Your staff run your business – you just have to show them how. This is why employing the best people for the job is essential.

Diana Albertyn

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According to the Franchise Association of South Africa (FASA) 2017 Franchisor Survey, one of the main challenges facing franchisees is finding the right staff.

“Staffing your franchise can be one of the most challenging parts of running a successful business. Without a great team of employees, you cannot run your business effectively,” says Saxon Marsden-Huggins, founder of WebRover.

These three tips could help you find the best employees for your franchise outlet:

1. Don’t hire in haste

While you may be rearing to go and keen to fill gaps to speed up profitability, research your candidates thoroughly.

Related: Insights On Recruitment That Could Affect Franchise Performance

As the job applications keep flowing into your inbox, keep in mind that not all of them qualify for the positions available – it may even be a small percent who are actually viable candidates. This is why your hiring process should include:

  • Taking the time to thoroughly screen CVs to develop a short list
  • Creating a carefully crafted list of interview questions
  • Setting aside adequate time for thorough interviews
  • Getting to know the candidates through a second round of interviews to confirm your choice.

Giving the hiring process dedication and attention will ensure you get the cream of the crop, contributing to the long-term success of your franchise.

2. Demonstrate support in the workplace

While you can instil the necessary skills into new recruits, it’s difficult to train for culture. This is why choosing the right employees from the beginning will make the rest of your franchise management system will run more smoothly.

“The manner by which you run the franchise will influence employee perceptions of the brand as well,” says Hireology’s Erin Borgerson. “Your staff must become ambassadors of your franchise system to attract the target consumer market.”

The best way to do this is encouraging staff to give you their honest feedback. Your commitment to creating and upholding a positive culture will result in increased loyalty from your current staff and a superior pool of applicants.

Related: 3 Things You Should Consider Before Buying Your First Franchise

3. Offer appealing incentives

When advancement opportunities are clearly communicated, staff is keen to hear how they can get there, as they have career goals of their own. Encouraging this ambition will draw good employees to your franchise.

“Helping employees understand the steps to advancement helps them to view their current job as an important part of a career with an upward path, not just a pay cheque for this week,” say financial reporting technology experts at Qvinci.

Performance bonuses and employee benefits incentivise staff’s efforts, therefore increasing their income alongside the profit of the business. “This serves to make employees a part of the business and not merely people ‘who work there’,” they explain.

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Franchisee Advice

3 Ways Communication Helps You Run Your Franchise Better

Managing your business as an independent owner may have been challenging at the beginning, but – as you’ve come to realise – the successful operation of a franchise network requires an extended set of skills.

Diana Albertyn

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“When it comes to a multi-location business such as a franchise, effective communication is vital,” says Dani Peleva, Managing Director at online marketing agency Local Fame. “So what happens when you’re struggling to connect with the franchise network you have in place?”

It may be time to upgrade your franchise management skills, because the success of your franchise network has a direct correlation to how you integrate feedback systems into your management processes.

Have a clear comprehension of the challenges your franchise encounters, keep an open chain of communication between yourself, franchisees and managers, and maintain regular interactions between everyone in the network. These are some of the most crucial aspects of successful franchise management:

1. Understand the challenges you face

A thorough understanding of your business requires dedication to regular and consistent groundwork for first-hand experience on how the day-to-day operations of the business are conducted.

Related: 3 Core Strategies For Building Successful Franchise Organisations

“Seeing and talking to the people that make your business will help you understand the challenges that franchisees face and the systems they need to drive higher profitability and growth,” says Rosie Niblock, Marketing and Communications Manager at Proactive Marketing.

“That way you can work more effectively to make improvements to franchise management systems logically and within the financial grasp of all franchisees.”

2. Get personal through regular visits

You never want your franchises to feel neglected. It’ll demoralise them and possibly drop sales, profits and their ability to keep the business running as you intended. Maintaining regular contact and sharing as much information as possible – when you can – fosters strong relations with your franchisees.

Empowerment through information and communication makes a difference in the business and helps franchisees make decisions in favour of the business and to make sure that they all pull in the same direction in terms of customer satisfaction, says Alan van der Westhuizen, executive manager of new business sales at Fournews, a 20-year-old franchise holding company for News Café, Krispy Kreme, Moyo, Brooklyn Brothers, Smooch, Cafe Fino and Go! outlets.

Ensure your response to these concerns is swift. “If not discussed they could fester ad create undesirable rumours,” says Niblock.

Related: How To Write An Operations Manual For Your Franchise

3. Create events for network collaboration

One of the most important aspects of managing your franchise is meeting with all your franchisees, at least annually. “Franchise conventions are almost certainly the biggest tool when it comes to building profitable engagement,” says Peleva. “They’re one of the most important things to focus on when you’re considering how to lead your franchise network.” According to her, a successfully attended and executed convention will let you:

  • Boost your network-wide productivity
  • Hugely increase your profitability
  • Drive passion for your brand

Communicating with your franchisees is the best way to identify problems, work towards solving them, and building a pleasant and fruitful relationship with your owners.

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