Becoming a successful franchisor is no small feat. Franchising offers a low-cost means of expansion, but it isn’t a guaranteed path to success.
Why do some franchisors succeed, while others never get adequate returns? What separates businesses that blossom from those that fall by the wayside?
No. 1: Understand Your Role in the Marketplace
Building a profitable franchise system requires a solid grasp of the marketplace and the competition.
But it isn’t enough just to have a vision. To succeed, a franchisor must have a clear idea of exactly how their brand will fit in a larger market. Just as important, a franchisor must understand where the marketplace is heading.
The most successful franchise system owners know how to take advantage of market opportunities. Often, these opportunities come in the form of addressing service or product flaws among the competition. Exploiting a competitor’s shortcomings is a tried-and-true way for a new franchisor to carve out a share of the market.
No. 2: Figure Out How to Sell Your Vision
For maximum success as a franchisor, you must translate your marketplace visions into reality — and that means becoming an effective salesperson.
To sell bankers, investors and others on the merits of the brand you’re franchising, a franchisor must overcome significant hurdles and objections. Detractors may challenge your concept of franchising for a number of reasons, such as a lack of name recognition or difficulties obtaining capital.
Passion is key to getting past these potential barriers to franchising. A franchisor must start with a deep-seated belief that their concept is a better alternative to the current marketplace offerings.
A skilled, passionate salesperson can sell their vision to many diverse audiences — including potential franchisees.
No. 3: Never Compromise Your Brand Standards
Quality and consistency are essential to franchisor success.
Brand standards must be faithfully followed at all times. To that end, every franchisor must find a way to reduce their business concept to a repeatable, teachable system.
It’s also imperative that you spend the time and money necessary to ensure that all standards are strictly enforced. Failure to do so can have a significant impact on future franchisor profitability. Taking a hard-line stance on quality is crucial to success with a franchise.
A new franchisor must also do whatever it takes to ensure their franchisees are positioned to succeed with the brand. Profitable franchisees create a marketplace buzz, which helps to sell other potential franchisees on the business concept.
Are you thinking about expanding your business through franchising? An experienced franchise attorney can be a powerful ally in your new endeavors. For expert, personalized assistance on your road to franchisor success, contact the experienced attorneys at Franchise & Business Law Group in Salt Lake City, Utah.