Three Keys to Franchise Success
There are manysuccessfulfranchisees out there. But, as is the case with all business opportunities, there are just as many franchise failures as there are success stories. If you want to highly successful with any of the number of great franchise opportunities out there today, there are three key things that you must do exceedingly well.
The first is to understand the key drivers of success in your business -- that is to say, the three or four major strategies or operational processes that make up the engine of profitability and success for your organization. As an example, for a restaurant these factors may include things such as speed, consistency, freshness, cleanliness and friendliness. For an auto parts store the key drivers will probably include inventory availability, customer service, expertise and pricing/margins. Once you understand the key drivers, it is critical that you focus on them incessantly and help everyone in your organization understand that it is their responsibility to make sure those drivers are the top priority for them every day at work.
The second thing to keep in mind is that the quality of your team will determine the success of your organization. Often times front-line people are the lowest paid and least trained, yet are the very people that create the customer’s perception of your business. Every employee must be the best possible person you can get for the position they're going to fill. That does not mean you need to hire a NASA rocket scientist to run the cash register -- only that you to do everything in your power to put the highest quality people you can on your team. There are two clichés that come to mind, but they are both 100% true: “Hire for attitude – train for skills," and, "Hire slow, fire fast."
Lastly, identify the key "Moments of Truth” for your business. In every franchise there are dozens of customer “touchpoints” – where your staff interacts directly with your customers, either in person, on the phone or through the Internet – but there are select few of these touchpoints that are make-or-break moments that must be delivered flawlessly every single time. These are your Moments of Truth. To use my restaurant example again, there are four moments of truth for every restaurant on the face of the earth: quality food, good service, reasonable prices, and cleanliness. It does not matter how well a restaurant fairs at all of the other touch points. If it cannot deliver these four critical Moments of Truth superbly for every customer, it will soon be out of business. It is the leader's job to work with their staff in identifying what their customers consider the vital Moments of Truth and then create the processes and systems that allows every employee to consistently meet or exceed the customer's expectations.
It is my firm belief that if you do the three things I've listed above very, very well, it will have a dramatic positive impact on your business. These are by no means the ONLY three things you need to do, but they are a darn good start.
John Spence is the author of “Awesomely Simple – Essential Business Strategies for Turning Ideas into Action." He is an award-wining professional speaker and corporate trainer, and has been recognized as one of the Top 100 Business Thought Leaders in America.
Franchise Disclosure Document for Dummies – Part 8
Item 20 consists primarily of 5 tables that provide information on the number of franchised and company-owned outlets operating under the franchisor’s brand and business system.
How Do You Pay for a Franchise?
Whether you’re purchasing a whopper from Burger King or joining the Burger King franchise system, the old mantra holds true: there’s no such thing as a free lunch. When you first get started running a franchise you need to pay a fee to allow you to enter into that franchise. These fees are the largest fees that you will normally pay a franchisor and typically range between $5,000 and $1,000,000 depending on the franchise. The franchisor charges this fee as a way to recoup the costs of expanding the franchise and to continue to grow. From a franchisee perspective, this is a major outlay and can take a long time to make back, but is a necessary step. Aspiring business owners must understand how much capital is available to them so they can ascertain how much they can afford. The cash you have at your disposal is known as liquidity, and there are numerous ways to increase your liquidity above the balance in your bank account. As a result, many people don’t realize how much capital they actually can use for investments, like launching a franchise branch. We’ll run through some of those methods below.
Time Saving Tips for Franchise Shoppers
Time is a precious commodity these days and although buying a franchise is a time consuming process, there are ways to cut to the chase. Of course you should do your due diligence, but first make sure you’re focused on viable choices. Here are some tips to quickly identify the best franchise opportunities for you so no time is wasted.