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Every franchise company touts its support function as being a major reason why a potential franchisee should consider investing in its franchise.
Traditionally, support is thought of in terms of a business context defined as the franchise that is being sold at that moment. And so, we are used to dealing with support in terms of a menu of facilities to enhance the quality of relations with vendors (researching new product offerings and providing analysis to the franchisee community about the comparative attractiveness of new products that might be useful in the franchised business, negotiating group buying deals at favourable prices and representing our franchisees when vendors are slow in providing tech service for their products), being on the lookout for new products and services that can fit into the franchised business to expand the scope of customer service, and providing business analysis to assist in more efficient management of time, personnel, production and money. To be sure, there are other items one could include, but the support is thought of in terms of support for this particular business, be it an auto repair shop, a food service franchise, a print shop or whatever that particular business may be.
Sometimes, as I stand around here tending bar, waiting for happy hour to begin, an idea will pop into my head that seems to get better as I think more about it. Recently, since I know my friend Nick Bibby has been working on programs to enhance support capability, I have been thinking about franchise support. And it has occurred to me that there is another dimension to franchise support that holds great potential promise. That is franchise support that is targeted at the franchise as an investment rather than as one business operated by the person who bought this particular franchise. To be sure, your franchisee focuses primarily upon the operation of the business currently owned. And that business is probably thought of as embodying the entire scope of commitment to a relationship with your franchising company. In that dimension, your franchisees' relationship with your company is for a stated period of years, providing the market does not so drastically change in the wrong direction to diminish the prospects for growth and profitability over a longer term. It may also encompass the ownership of more than one unit, with the same limiting circumstances being applicable. But, if we make re-dimensional support to include support of the relationship with your company as an investment vehicle that is not limited in scope to the franchise already being operated, we can offer investment quality that is orders of magnitude better, The reason being, that this level of support can overcome the impact of market changes. Competition in the business already being operated will have an impact eventually. That impact will not be fortuitous. Our better franchisees will be looking to sell that franchise and go look elsewhere for another growth stage franchise investment. Why shouldn't that franchisee come here first?
Now, if we are going to consider this refocusing of our notion of franchise investment support, what is its best mode of application to optimize our potential with our best franchisees? I think the answer is to implement this support function from the very early stages of your own company's entry upon the franchising stage. By the time you are four or five years old and have sold between 50 and 100 franchises, this "investment support" should already be in full swing. It would involve the addition of a corporate development function, someone whose responsibility would be to scour the fields of new, but different, business prospects.
There are hundreds of new business concepts out there just dying for partnering opportunities with companies that already understand how to achieve a successful business replication program. You know how to sell a franchise, how to train franchisees (in general terms), how to advertise and market franchises, and how to manage the franchise relationship as it develops. Moreover, with each of these new concepts that is worthy of consideration (so many are not), the originator brings his or her own operating experience to the table and can serve as your corporate expert on that new concept. They should already have a few stores in operation that provide a base of operational credibility, a core resource for training and for promoting a 'new' franchise available from your company that prospects can actually go and see and that have some operating financial history to suggest that it is a real concept from an investment quality perspective.
I believe that any franchise company that has enjoyed a successful franchising history for several years is ideally suited to pursue this program. Its learning curve and extant resources can be applied to franchising any business with the addition of personnel with specific experience in it. I also believe that bringing in new investment worthy business concepts will be the best way to overcome the inevitable "aging" effects on your current franchise offering, and that waiting until those "aging" effects begin to manifest themselves is waiting too long. This diversification, as I said in How Full Is Your Monty? timely achieved, can take the pain out of the later years in any franchise concept. Think of it as franchisor Viagra!
Copyright 1997 - 2010 || Richard A. Solomon
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 | Licensing, Technology Transfers, |