Franchises are often portrayed as a low-risk way to start a business. For all intents and purposes, it is a generally safe way to run your business. You will have a franchisor who will be nearly as invested as you in your success. If you have questions about something, go to your franchisor. Ask them and use them as a resource. When you succeed, so do they.
Your franchisor will give you certain policies and systems they want in place. Some franchisees will start to change how they do things after a few months. They’ll modify certain products or services, change advertising, modify hours, and more. Even if you think it’s a profitable idea, working outside of the parameters of your franchise agreement violates it and could result in termination. Always work under the guidelines your franchisor provides.
Every business comes with its set of risks. Even with hard work and talent involved, a franchise can still fail. Here is what you need to know about running a franchise business successfully.
Know how much you have to invest and where you intend to put it. A lot of franchises fail from lack of financial planning. Understand how you are going to be spending your money in the months to come and ensure you aren’t misled on what the initial first-year investment will be.
Constantly monitor the numbers with what’s going on with your business. Minimize costs, maximize sales, and watch for merchandise that’s either missing or unaccounted for. Look at the projections you’ve made and whether you will reach them or not. You don’t want a financial problem to suddenly be sprung.
If you’re monitoring the numbers correctly, you can identify all sorts of interesting trends. You can course-correct before something small grows into a major issue.
A franchise lawyer is there for your protection. They ensure your rights are respected as a new franchise owner and can advise you on a wide array of legal questions you may have. For this, you don’t want to use a franchisor’s lawyer.
You want to procure your own franchise lawyer to work on your behalf, should there come up any issues. The lawyer can also look over contracts and assist you with the heavy lifting on difficult-to-navigate legal matters.
Build a Good Team
Any business, franchise or not, will live and die by the team they hire. Ensure you hire good team members. That’s first. How you hang onto good team members then becomes your next challenge. How you do that is by being fair and not showing favoritism and creating favorable schedules. You should also treat everyone with respect and resolve disagreements and challenges quickly. Finally, reward good work with acknowledgment and salary increases.
Your employees are your frontline workers. They represent your business to the general public. They should be aware of what the expectation is in terms of look and conduct. Train your employees. Retrain employees on occasion. If your franchisor offers training opportunities, look into those. Consider a bi-weekly check-in with each employee, depending on how many you have, and use it as an opportunity to acknowledge their work and brush up on performance expectations.
Prioritize the Customer
Some franchises are not successful because they aren’t doing right by the customer. They are so focused on profitability and other things that they forget about the customer experience. A customer shouldn’t be disappointed in your franchise or question why they decided to put their dollar towards your place of business. Constantly seek to improve what you’re doing for the customer, adding value.
Identify Community Opportunities
Integrate yourself within the community. Ask your franchisor about what’s appropriate for their brand. Identify community events or trade shows where you might be able to set up. Consider offering something for free or arranging a giveaway in exchange for social media exposure. Support a local sports team or youth group. Connect with local charity organizations. The more you support others, the more you will notice this exposure leading to the community wanting to support your franchise.
Lead By Example
You’re at the head of the table. You set the tone for how things are going to go. Be enthusiastic. Motivate staff. Acknowledge staff when they do good work. You want to create a work environment where people are excited to come to.