Franchising can be traced back to 18th century England, where Lords are said to have given peasants rights on their land in exchange for compensation. That tradition of one entity managing assets for another and paying commission on those assets continues today. There are over 929 franchise brands operating in the UK, with the number of profitable franchise business listed in the 90th percentile by the British Franchise Association.
You will also need to worry about new investments, like personnel and cost of travelling from one location to another. Learning to work remotely will help, but there is definitely a “secret sauce” to managing your own franchise.
Establishing Funding
Funding will be just as much of a factor, except that you’ll have some of your own money to invest that comes out of the original business. You may have an easier time qualifying for a loan because you can show a successful track record of franchise management. You can cover improvement costs with your own cash and focus investor money on building the nuts and bolts of the business.
Hiring
The main skills you need in franchising involve time management and customer service. Consult your franchisor for hiring tips. Questions to ask during an interview, or skills to look at from a resume could mean the difference between a bad investment and a good one.
Remember that each hire is critical and a bad cog in the machine costs you money and time. That’s why investors like Jake Wand stress the importance of surrounding yourself with enterprising individuals.
Consulting the Franchisor
The franchisor can help take care of much of the stress involved with opening a second or third location. They may have ideas on locations where you can start, or provide some reduced royalties for the first year or two of operation. Be prepared to make a commitment to the franchisor if you want to take full advantage of some of these benefits, but they are often designed with your success in mind. If the franchisor holds events in your area, attend them and work on building a strong relationship with them.
Good support is your most valuable asset.
Put Customers First
Just like your original location, your focus on customers will ultimately drive your business. Make sure your employees are well-versed in customer service interactions and know how to handle situations. Check with the franchisor to see what, if any, training exists for your employees.
One great way to get feedback on your business is setting up a mechanism online to do so. If your franchisor doesn’t have anything to offer to you, simple software like Survey Monkey can record results when customers visit a URL you give to them. Program your POS machines to print the URL on the customer’s receipt, then make improvements to your staff and procedure based on their opinions.
Don’t Compete
Before you try to corner the coffee market with three different café franchises, be sure that you’re allowed to do so. Some franchises may refuse you if they know that you own a competing location. You should also make it clear that you are committed to developing the new location and will devote resources to do so. Getting approved for the franchise is not a done deal, and should not be perceived as one. Make sure you approach the deal carefully, with the franchisor’s goals in mind with your own.
Partner Up
Partnering frees up time to devote to the new location. Having a spouse or a trusted colleague step in to manage a location can make a huge difference in your productivity. Don’t stretch yourself thin, recruit some help.
Article contributed by Jenna Smith
