Tips for Attending a Franchise Show
Attending a franchise show or franchise expo can help you familiarize yourself with dozens of franchise opportunities in just a few hours, but unless you're a grizzled veteran of the franchise expo circuit, it can be easy to waste those hours simply wandering the show floor without purpose.
Here are a few tips to help you make the most of your franchise show attendance:
- Don't walk around aimlessly or without purpose
- Make sure that you are dealing with a bona fide franchise
- Prepare a list of questions to ask the franchise reps at each booth you visit
Let's explore each of these tips one by one:
Don't walk around aimlessly
Every event will publish a franchise directory of all the exhibitors that will be at the show. You will typically receive a copy of the franchise show directory when you sign in to the attendee table at the start of the show but you can often find the directory online as well at the franchise show website.
This directory is your map to the event - spend your first fifteen minutes at the show (or, even better, the night before you attend) looking through the directory to target the franchises you most want to visit. Systematically approach your targeted franchise booths or tables and ask your prepared questions (see below) and then see where the conversation takes you. After you have finished with the franchises on your must-see list, you can freely browse the other franchise booths to find new and unexpected opportunities.
Make sure that you are dealing with an actual franchise
Unbeknownst to many show attendees, some of the exhibitors at a franchise expo may not actually be franchises. Many show exhibitors are offering "business opportunities" (also known as "Biz Opps") and "multi-level marketing plans." Do not be side tracked by these other business models promoting business opportunities and marketing gimmicks as genuine franchise opportunities unless you understand the difference between a business opportunity and a franchise opportunity and know the specific advantages of one over the other. These other business models may have their audience, but they're not the same thing as franchise opportunities and shouldn't be misconstrued as such.
But how can you determine if you are dealing with an actual franchise business?
- First, simply ask a representative of the company point-blank if they represent a bona fide franchise
- Next, ask the representative to explain their company's business model and what you could expect as far as guidance, training, and ongoing support as a franchisee of their system. True franchises should provide their franchisees with a clearly explained, repeatable business process, initial training on that business process, and ongoing support and advice of some nature.
- If you're still unsure, ask the representative when their business last filed a Franchise Disclosure Document (FDD). Franchises must file this document (which used to be known as a Uniform Franchise Offering Circular (UFOC)) in accordance with Federal Trade Commission (FTC) guidelines in every state in which they plan to offer franchise opportunities. The representative should be able to confirm for you that an FDD was filed for your state within the last 12 months. Certain very large and well-known franchises like McDonald's and Subway might be exempt from the FDD requirement; in those cases the company representative should be able to confirm for you that their franchise has filed for and received an official exemption from the FDD requirement for your state within the last 12 months.
Prepare your list of must-ask questions
Of course it is perfectly fine to let your discussions with franchise representatives take a natural path. That said, to make sure you leave the event with a great basis for comparing the opportunities out there, you should prepare a list of the 3 to 5 most important questions you need answered in order to decide which opportunities you would like to explore further.
This list should reflect YOUR priorities, but it could include such questions as:
- What are the initial franchise fee, expected startup costs, and ongoing royalty and marketing fees? How do these compare with your competitors?
- What kinds of hours should a new franchisee expect to work during their first two years in the system? What does the franchisor base this estimate on?
- What kind of training and ongoing support does the franchisor provide?
- What have been the common character traits of their franchise system's most successful franchisees? How about the traits of their least successful franchisees (the rep may be less than enthusiastic about answering that one!)?
- Are there any special requirements or qualifications for joining the system (for example, must the franchisee be a CPA or have previous experience in the industry)?
- As a new franchisee, will you receive an exclusive area in which to operate? If so, how is that area determined? If not, how much overlap does the franchisor allow among franchise locations?
These are just some basic ideas - feel free to explore our Franchise 101 for a more extensive list of the questions you should consider asking when speaking with a franchise representative.
Now that you know how to plan for and make the most out of your franchise show experience, it's time to search our franchise show schedule to find the next expo or event taking place near you!
Steps to improve the franchisee's profitability
Topics to be covered in this strategic audit should include at a minimum these ten (10) items:
How Much Do You Have to Spend?
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.
Three Keys to Franchise Success
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.