Running a prosperous franchise requires tenacity, drive, business sense, and vision. The McDonald’s founder Ray Kroc famously said: “A leader’s excellence is reflected in the standards they set for themselves.” Every franchisor has to have the ability to set these criteria and understand how to close the gap between their vision and reality in order to build a successful franchise business.
You need to lay the groundwork and provide franchisees with the resources and tools they require in order for them to perform better and deliver better customer service. The key tactics needed to get a competitive edge are listed here, whether you’re ready to launch a franchise or are just considering it.
8 Tips for a Successful Franchise Business
Determining your definition of success in terms of size is the first step in learning how to run a franchise business successfully. How broadly do you want the reach of your company to be? Of course, things might change, but having a plan and the advice below can help you strategy successfully.
1. Love the Product or Service You Offer
There are peaks and dips everywhere in entrepreneurship. When things are going well, it’s simple to be energized, but when they aren’t, you’ll still need the same vigor, if not more. Passion is a “key determinant of an entrepreneur’s innovation, tenacity, and venture performance,” according to the Harvard Business Review. The likelihood of a franchisor’s success increases with its level of enthusiasm.
The energy present when you are enthusiastic and sincerely believe in what you have to give will always result in greater customer service, goods, or services. It is feasible to build your franchise by having a pure interest in metrics and profit. Despite being testable, passion cannot be faked; it is what fuels resilience.
2. Make Sure You Have Starting Capital
The price of franchising varies from business to business. Being a successful franchise requires paying for the drafting of an operations manual and franchise disclosure document, as well as for the creation, filing, and registration of financial statements.
To draw in new franchisees, you will also need to invest additional funds on a website for franchise sales, branding, franchise sales presentations, paid advertising, and joining pertinent broker groups. The administrative burden can be reduced by hiring a seasoned digital marketing agency, but this will come at a cost that, although valuable, must still be accounted for.
3. Develop a Plan to Achieve Your Goals
What is the key to running a successful franchise? a plan of business. These comprehensive papers act as road maps for your company venture. Typically, company plans include the following:
- A succinct overview
- Company Overview
- Business description
- The client’s description
- Competitive research
- Plan for marketing and sales
- Plan for managing operations
- Budgetary Plan
- Appendix
Businesses should constantly adapt to the changing demands of their clients and the market. If you’re trying to obtain money from lenders and investors, having a comprehensive business plan that outlines your goals is quite helpful. It enables you to accurately appraise your firm, get genuine about your cash flow, and make sure your company’s goods and services are up to date.
4. Hire the Right Team
Your company’s greatest asset is its workforce. Both your business staff and potential franchisees share responsibility for how you run your company, how it seems to consumers or clients, and ultimately, how successful you are. It’s crucial to strike a balance when recruiting between job role skills and business culture; there’s no use in hiring someone who doesn’t fit with your firm’s ethos and values.
5. Provide the Right Tools and Support to Your Franchises
An infrastructure that is flexible but robust and helpful is what distinguishes a good franchise. Starting off, all franchisees require training. Despite their experience, they will still need to become familiar with your operational model. Continuous training makes ensuring that benchmarks are fulfilled and standards are upheld.
A good team is essential to building a successful franchise, as we previously discussed. Maintaining a strong franchise culture requires holding regional or system meetings and conventions to share knowledge, provide training, and communicate with franchisees.
Additionally, streamlining operations and increasing efficiency are achieved by putting up the digital infrastructure to optimize and standardize company processes. Franchisees may benefit from dynamic lead gathering, invoicing, and payments thanks to franchise management software, such as serviceminder.io. Digital technologies are increasingly being used in companies to measure KPIs and promote corporate success.
6. Make Sure Your Franchisees Provide Great Customer Service
59% of Americans think they will stop using a firm or product after numerous negative encounters, and 17% after only one, according to PWC. Due to the likelihood that returning customers would spend more money on your good or service, client retention is typically less expensive than acquisition. Customers who are satisfied are more likely to make referrals and stick around.
You must establish feedback methods for clients to review your service in order to expand your franchise. You must also make sure your franchisees are adequately trained. You won’t have the essential insights to know where or how to improve without helpful criticism. Good customer service creates a positive first impression and motivates repeat business.
Good customer service includes prompt replies, individualized attention, and proactive outreach to your clientele with added-value offers or promotions. Excellent customer service improves brand perception, and a strong reputation is essential to the expansion of your franchise.
7. Get Involved in the Community
By giving your time and services to your neighborhood, you may make people aware of your existence, help others, and get vital input on how to grow your franchise business. Knowing your neighborhood can help you get more familiar with potential consumers and provide better service. In order to support victims of domestic abuse, some franchisees, like Molly Maid’s Ms. Molly Foundation, have even gone so far as to establish a non-profit organization, that aids in bringing about change locally.
8. Connect With Your Business Colleagues
You must use your networking abilities if you are a franchisor or someone who is considering launching a franchise package. By networking, you may learn more about your rivals and find prospective franchisees who are dedicated to expanding your franchise network. Developing connections with a network of individuals who share your aims helps increase morale because running a business can be isolating.
Because you’ll be exposed to the newest trends, innovations, changes, and methods for restructuring and optimizing a company in a dynamic environment, networking also presents another opportunity to learn how to be successful in a franchise business. Experienced franchises will be familiar with how to handle unique issues that are not included in an owner’s handbook.
In order to build their own franchise portfolio, many seasoned franchisees through tough procedures, so they have first-hand experience with how to handle unique issues. Franchises may develop through networking with other businesses in the area and absorbing their knowledge, just as a company might succeed by recruiting the best personnel.
Conclusion
A successful franchise owner possesses an entrepreneurial spirit, the perseverance to put in the time and effort necessary to see results, and the flexibility to change as their business expands. A successful franchisor should help franchisees with location selection, financial guidance, marketing, and management in addition to providing a brand and an operational business plan.
