You have your plan of ready – now all that’s left is the execution. Being a great business owner and being a great franchisor require different skillsets. You’re going to have to work with more people, entrusting them to carry out the same successful formula you’ve created for your current (and hopefully, future) success.
Expansion means growing your business into locations you can’t physically inspect as part of the franchise’s daily operations. This makes choosing the right people to run your stores, the right people to work there, and understanding your new role as a franchisor.
You may have steered your business success thus far alone, but to run an entire franchise chain, you’re going to need to ensure you’re doing the following:
1. Build a solid foundation
Finding candidates who are interested in your business and willing to invest in becoming a franchisee is becoming increasingly difficult. The emergence of other franchise systems means you’re competing more for their investment than ever before.
The long-term success of your franchise is largely dependent on the quality of your franchisees – especially the first few you get on board. It’s so challenging finding the right people with the right qualifications – in an effort to grow the business, you may be tempted to award franchises to friends and family in the early stages, says Christian Faulconer, CEO of the Franchise Foundry. “While this may work in some cases, in most cases your friends and family are not the most qualified franchisees.”
Take your time in the selection process of any potential franchisees. Each store will be a representation of your brand, and you want to ensure it’s a good one. “‘Hire slow, fire fast’ are words to live by,” says Faulconer.
2. Nurture relationships
Now that you’ve laid the foundation, it’s time to build your franchise empire by ensuring the right franchisees are treated right. If they learn from you how to treat employees, they’ll run franchises customers will enjoy visiting – just as was the case at your original store.
“Keep in mind to treat franchisees as you would want to be treated and always do the right thing by them, to reap happy, successful franchisees,” says Kim Ellis, Senior Consultant at MSA Worldwide. “If you’re only it to make money, you’ll will end up with unhappy franchisees. Without the franchisees’ validation, it is tough to add new franchisees.
“The franchisor needs to recognise that the relationship they build with their franchisees is the key to their long-term success,” says Ellis.
Invest time to nurture a positive relationship with franchisees, and where possible, assist with hiring the right staff to run operations within the respective stores.
3. Understand your role as franchisor
As a business owner your focus was on business performance, operations, and expenses, but being a franchisor means adding, training, and supporting franchisees. “Making the shift from business owner to franchisor is often a critical step for the success of the franchise business,” says Ellis.
Transforming your business into a franchise requires you to take on a different role in the expansion process. You need to make the shift from an active part of the business, to more of a leader who strategises and monitors.