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Franchisee Advice

Secrets to Success

Yes, you can be a successful franchisee, here’s how.

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Unfortunately, there’s no magic potion you can create to guarantee the franchise you buy will be a big hit. But you can learn a few tricks of the trade and master the major elements that give a new franchise the strength it needs to thrive. Here are some of the bare essentials for being a successful franchisee in this unique economic climate.

Cash Is Still King

To make money, you need to spend money… or at least have a little. While purse strings are tightening, franchisees still need to find the funds to maintain and grow their businesses. You have to be funded in most cases. You can’t go into this on a shoestring; if you do, today’s economy will not allow you to succeed.

There are going to be peaks and valleys like we’ve never seen before. You can go for one week without any business and just get completely run over by customers the next. It’s that kind of economy, and without the cash to operate, you’re not going to be able to continue your system.

Franchisees with means will not only weather tough economic times, they may even come away with stronger businesses. They can survive recessions, creating more market share for themselves when the economy recovers. Many franchisees realise that if they get into the market right now and really slug it out, when the economy starts to grind out of this recession, they will have a bigger market share and a better future.

Get the Word Out

To put it bluntly, without customers you have no business. So making the right customer base aware of your business is key. But if they don’t have the resources for the traditional massive media campaigns, today’s franchisees have to find new creative, inexpensive methods to reach their markets.

Franchisees must understand exactly where their customers are coming from and aim their efforts toward those neighbourhoods, office buildings, hospitals or colleges. They need to be very efficient with their marketing spend. Right now, with things the way they are, it would be a sin to be inefficient with marketing spend and marketing effort.

To make sure the marketing and advertising programmes you put in place benefit your business, consider the pluses and minuses of each option. You have 50 different advertising media to choose from, and you have to decide ‘Where do I spend my money? What’s effective? What’s not effective?’ Advertising can get pretty expensive pretty quickly.

Best Supporting Role

One of the major benefits of joining a franchise is that the franchisor provides you with a tested and proven operating system. While it seems obvious, following the system the franchisor has put in place is essential for a franchisee’s success.

The more you fail to execute those key elements, the more adversely it affects your business. Because of the complexity of business today, you really have to be following the system. In the current environment, there’s no margin for error.

The franchisee has never had more of a responsibility to play his or her role. When times get more competitive, franchise concepts have to get stronger. They’ve got to perform better. Keeping these key elements in mind can benefit not only your franchise, but also the system as a whole. If you’re going to buy a franchise, you do what the franchise does.

You don’t try to stray from it and do your own thing. If you want to do that, you should be an independent business owner. Consistency is one of the most important parts of a franchise, and that applies to all aspects of your business.

Know Thyself

As important as maintaining the expectations of the franchisor is understanding exactly what you want from the franchise. This is a timeless truth, no matter what the state of the economy. To be a successful franchisee, you should always have very clearly defined personal goals. A business is simply a vehicle to help you achieve the quality of life you want, and that has to start with fully understanding what you really want.

Your personality can also influence whether you’re going to succeed at franchising. Franchisees have to look in the mirror and go through a certain amount of introspection. They have to ask themselves one question: Am I willing to be part of a team, or am I looking to create something? If they’re mavericks with a need to create, to re-engineer, to express their own creativity, they should not go into franchising. These individuals make the worst franchisees possible.

By being part of a franchise system, you not only have the support of the franchisor but also access to an entire network of other franchisees who may be experiencing the same challenges. Asking for their help and offering your own is good for everyone. Why else would you buy a franchise if you didn’t take advantage of that benefit? That’s what you’re paying for, and it’s one of the most crucial elements of success.

Tapping into this network can save time and headaches. If you’re buying a franchise, information is available from the franchisor and all the other franchisees, whether it’s about employees, marketing or technical issues.

What’s the one key ingredient of franchise success? Everyone has their own ideas, but franchisee strength seems to come from a combination of a few essentials.

Franchisee Advice

What To Know About Franchising Your Business

For many businesses, franchising is an excellent route to growth, opening up new opportunities and markets. Laurette Pienaar, National Franchise Manager at Nedbank, unpacks why it’s worth considering this route.

Nadine Todd

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Vital Stats

  • Player: Laurette Pienaar
  • Position: National Franchise Manager
  • Company: Nedbank Limited
  • Visit: nedbank.co.za

What type of business is ideally suited to the franchise model?

Franchising has been proven successful across all industries, including the automotive, food, entertainment and retail industries. However, several key qualities ultimately determine a concept’s ability to successfully become a franchise.

Firstly, the business model must be scalable and able to be repeated in several locations. Secondly, there must be demand for the products sold and, thirdly, the franchise model must be proven as profitable.

Related: (Infographic) 7 Digital Marketing Strategies For Franchises

Why is franchising a good growth option?

Franchising is often used as a cost-effective growth strategy for businesses. A key benefit of this strategy is that no capital layout is required for a new franchised store as opposed to corporate-owned stores.

Franchised stores are also proven to be more successful than corporate-owned stores. This is mainly due to the fact that the franchise owners have a vested interest in the store, whereas corporate stores are supervised by a manager. Franchising is therefore also a great way to build your brand.

What should business owners focus on?

Franchisors should set up good infrastructure to support their franchisees, including good upfront and ongoing training to both the franchisees and their staff, the correct legal advice and assistance, and a strong operational team to assist franchisees daily.

Many successful franchisors provide support by expanding through vertical integration, which provides franchisees with logistics, supply chain security and product consistency.

Several franchisors advocate a structure with both franchisee and corporate-owned stores. This enables a franchisor to keep in touch with the daily challenges franchisees experience and new products and solutions can be tested at a corporate store before being rolled out to the franchise network.

How can franchising consultants assist business owners?

Franchise consultants provide daily operational support to franchisees. They are responsible for daily store visits to assist with quality checks, process flows, supplier relationships and, often, financial assessments. They are a helpful soundboard on any improvements to be made in the business model and can convey suggestions to the franchisor.

Related: The Secret Sauce To Great Franchise Leadership

What challenges should business owners be aware of?

Businesses looking to franchise need to ensure that their business is teachable to others. Overcomplicated products and systems may deter franchisees from investing in your brand.

Franchisors have to do ongoing introspection regarding their company culture. For example, does the culture promote innovation and inspire franchisees and consumers, which ultimately is a culture worth investing in?

New franchisors’ selection criteria for franchisees are often not sufficiently thorough and comprehensive. For a new franchisor, it is important to choose good quality franchisees and to have strict selection criteria to ensure that your brand remains reputable and stable during fast-expanding cycles.

What lessons can be learnt from SA’s successful franchises?

Businesses looking to expand through franchising should consider setting up several corporate-owned stores first. This assures potential investors that your business is based on a proven model with a track record and supportive infrastructure.

There is not always a one-size-fits-all model. Many franchisors have created custom models to accommodate and adjust to the need of a specific property or consumer market. A great example of this would be the food industry where many franchisors offer shopping centre concepts, drive thrus and kiosk or express concepts. Consider this when developing your model.

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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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