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Franchisee Advice

Sidestepping Common Franchisee Mistakes

5 strategies for avoiding the most common franchisee mistakes.

Kyle Zagrodzky

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When people want to start their own business, franchising is an enticing option. It offers many of the perks of entrepreneurship, plus the safety net of operating a business based on proven concepts and systems. However, too many prospective franchisees start to think of buying into a franchise as a guarantee of success.

And, as many of us know, anything advertised as a ‘sure thing’ is always a myth in the business world.

Certainly, when franchising is operating the way it should, it will provide unit operators with a strong support network, great educational tools, sales templates, and initiatives and processes to guide every stage of the unit’s life. But no matter how fantastic a franchise concept seems, and no matter how many of its franchisees have made money, franchisees can’t forget that success ultimately depends on them.

Throughout my franchise development career, I’ve seen franchisees make the same handful of mistakes over and over again. Avoiding these errors seems simple enough in theory, yet they continue to hold back franchise entrepreneurs who otherwise have plenty of potential.

Related: Common Franchisor Mistakes… And How To Avoid Them

Here are five ways to avoid making these common mistakes.

1Develop a network with other unit owners

Part of the appeal of joining a franchise is the access it provides to a network of people who understand exactly what it’s like to run a business unit within that brand. Yet many franchisees still end up feeling disconnected and unsupported after their store opens.

That’s why franchisees should take advantage of the networking tools their franchise offers, because having a group of fellow franchisees to lean on can help everyone to grow and thrive.

A great franchise will give franchisees plenty of tools to keep in touch with one another, whether that means social media groups, weekly calls, regional directors who connect people and regular events where franchisees can meet in person.

2Accept total responsibility for your business unit

When things don’t go well in a franchise unit, often it’s because the franchisee isn’t prepared to take responsibility. It’s easy to play the blame game and make excuses, but that kind of attitude doesn’t go very far when it comes to actually fixing the problem.

Franchisees need to have realistic expectations and understand that not every unit will perform at its peak right away. But more than that, they need to accept that their business’s success or failure is ultimately on their own shoulders.

If things aren’t going as well as expected, franchisees should focus on the principles learned during their training and rely on the network of owners who may have been there, too.

The difference between a winning franchisee and one that needs improvement is the owner’s willingness to take responsibility for learning the systems and driving the numbers on the books.

Related: Avoid These 3 Simple Mistakes When Buying A Franchise

3Focus on daily goals and sales objectives first

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When a franchise isn’t performing, usually there is a root cause, and most of the time it traces back to the unit owner’s lack of focus on what really matters. So many franchisees get caught up in the day-to-day details of running a business and forget that their ultimate goal is simple: Prospect and sell.

If a franchisee suffers from tunnel vision and is too focused on unimportant tasks, we coaches help them zoom in on specifics that can help them grow.

Every day, the franchise owner’s main objective is to drive sales, and that’s where the bulk of his or her time should go. It’s the first goal that must be achieved.

4Stick to the marketing plan

Becoming part of a franchise doesn’t guarantee success; it means you have access to tools, templates and support that can lead to success — but only when you use those tools.

A franchise is designed to duplicate a single successful business model again and again, and the system works, but only when the franchisee follows that business model.

If he or she goes rogue and doesn’t use the concepts, sales tactics and branding the franchise is built on, things probably won’t work well.

Franchisees can’t believe that people will show up and buy their product or service just because the doors are open. You have to work to drive sales, and the system is there to streamline that process.

Related: Franchising Mistakes You Need To Avoid

5If a unit under-performs, be open to fixing the underlying cause of the problem

Franchises are made for franchisees to succeed based on an established system. So, if a unit isn’t making its weekly, monthly, and quarterly goals, there is generally a reason behind the slump. A lot of research, planning and investigation goes into choosing franchise locations, so the street address may not be the issue.

Similarly, the systems and processes have been vetted in other locations before, so those shouldn’t be the cause of sales distress, either. Instead, when a franchise unit isn’t going all the way, a smart franchisee will turn to the company’s leaders and guides — assuming they’re reliable — to step in and help figure out exactly what the solution is.

When outside resources see the reason for the dip in sales, that same smart franchisee will then listen to the advice offered and implement the changes suggested. Franchisees not open to outside perspectives on how to improve can’t expect anything to get better.

Kyle Zagrodzky is president of OsteoStrong, the health and wellness system that boosts bone and muscle strength in less than 10 minutes a week using scientifically proven osteogenic loading concepts. OsteoStrong introduced a new era in modern fitness and aging prevention two years ago and has since helped thousands of clients between ages 8 and 92 improve strength, balance, endurance and bone density. In 2014, the brand signed commitments with nine regional developers to launch 500 new locations across America.

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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