Your brand's franchise development person has undoubtedly been asked, "So how much is it and what do I get?" Typically during the franchise discovery process, the question comes up shortly after the company has been describing the highlights of its franchise business to a prospective franchisee. The franchise candidates are beginning to gain interest so now they are eager to know if they can afford the business and what they receive for their fees. While the questions are common, the answers require uncommon care; as the answers are neither simple or without serious consequences. Carry out these important steps incorrectly and your business might be paying for it long into a franchise relationship. However, carry out these steps well and it can transform your entire franchise system.
Relationships of all kinds are built upon initial expectations and the subsequent execution that follows. In commonplace language, if one says one thing and does another, there is going to be a difficult time for the life of that relationship. Especially in business dealings, people don't like surprises. It is important to set clear expectations from the start of your relationship and then follow through as closely as possible as the relationship progresses. In a franchise relationship, expectations may be forming even prior to the first conversation with a new franchise prospect, therefore it is important to determine key expectations and then start defining them early on.
STEP 1: Determine Key Expectations
Before creating a franchise development system, sales process or franchise marketing materials to represent your franchise offering, first determine the top aspects of your business that any new prospect should understand fully before joining your system. A few key items may include, but are not limited to: the culture, what is received for the franchise fee, what is received for the monthly royalty and advertising fees and the type and amount of support franchisees should expect on those items. Additional items to be represented are what important tasks a franchisee needs to perform on a daily basis to be successful, funds required to launch the business and ongoing fees needed to fund the business until break even and eventual profitability, as well as such important items as understanding competition and how to go about marketing and promoting the new franchise. How does the business determine and define its message pertaining to these items for the...