This is what I say when people ask me how I’m doing… while it may seem a little sassy and sarcastic… it’s the truth.
In all seriousness, I wake up each day excited at the possibilities. I love my work, I love my family and love the fact that I help people achieve their lifestyle goals…what ever they may be.
Another thing I love is fitness. While I am in franchising… I also own a fitness studio in Wisconsin. We have a great team that provides both fitness classes and nutrition programs for our members.
What’s rewarding for me, is the knowledge that my profession is 100% geared towards making people feel better about themselves… We build confidence in others! We show them they CAN!
What I find amazing… or disappointing is seeing people who are miserable with their lives. It could be their job, their relationships… or their fitness…or whatever…
Seeing people not “living their dream” can be disheartening.
The key to success and happiness… in my opinion is to avoid the personal feelings of limitation that are somewhat natural to our being. It’s very easy to say… I can’t do it…
Regrettably… in the end… you can!
If you are not living your dream, I encourage you to think why not. While it can be scary to make a change… it can also be very empowering. Think about what you really want… then go get it! You will be glad you did!
I recently attended a fitness conference in Atlanta. This was an opportunity for my business partner and me to learn about the latest trends so we can position our fitness center for future growth.
I love attending these conferences, as they are very empowering.
They also help with ACCOUNTABILITY as the speakers really drill down on you… especially if you are doing something wrong and/or need to change your practices. At times this can be very painful, however, there is no other way to learn and get better.
One interesting aspect I learned was the importance of having a quality team with you on your journey.
In previous posts I have discussed the aspect of “human capital”. Over the years I have seen many a business owner talk about their employees as a burden. They view them as replaceable cogs and nothing more. If this is the type of culture in your business you need to change your ways… and change it FAST!
You see, the best way to build a big business is to build a TEAM. Hire good people and continually invest in their development. Train them, motivate them and mentor them.
If you take this approach it will cultivate a team-oriented culture that will trickle down through every aspect of your business. It will enhance the experience for the business and most importantly… your customers.
If you find yourself wanting to take the next step with your business… think about building your TEAM!
It has been quite some time since I have contributed to my blog. Frankly there are no excuses… and I have to avoid using the dreaded phrase…”I was busy”.
In fact, the last 12 months have been very exciting for me. As many of you may know I am in the franchise business. I help coach people through the transition process of determining if franchise ownership is a suitable option. It’s a very fun and rewarding vocation and I enjoy working with aspiring business owners as they navigate the cumbersome process of franchise research.
This has so far been one of the most exciting and rewarding experiences of my life… and yes… it’s SCARY! We opened in December and have been able to grow the membership base over the last 9 months.
One of the most rewarding aspects of this journey was the building and development of the management team. You see, I live 1500 miles away from my business and thus I need to rely on quality people to oversee the operations. While challenging at first, right now I feel that we are doing an excellent job and I enjoy working closely with the team to help oversee the studio.
This experience has been very enlightening to me and has also enhanced my franchise consulting and brokerage practice…
Now I can relate much better with my clients as I have and continue to walk in their shoes.
Over the coming weeks I plan on sharing some of these experiences so more people can benefit.
I once had a client who was miserable in his career, well capitalized and had dual incomes as both he and his wife were employed. There was one problem…
He was miserable in what he was doing…
The hours were too long, his boss was overbearing and there was no fulfillment in his career. This is where franchise brokerage will differ from franchise consulting. A lot of people think franchise consulting is nothing more than sales, and while that certainly is a BIG part of the equation, the role is more geared towards coaching and mentorship…. And here’s why….
There is a common saying in the franchise industry. You don’t sell franchises… you help people buy them. The reason for the phrase is simple. Buying a franchise is a significant commitment both financially, as well as a lifestyle adjustment. Gone is the certainty of a regular paycheck. The owner must invest a large portion of their savings, and head into the uncertain world of business ownership.
This is where the franchise consulting, or “coaching” aspect comes in. It’s very common for people to become afraid. It’s fear that stops people, and in some cases, it can be a good thing. Owning a franchise or independent business is NOT for everyone. It’s very important for people to understand the risks associated with the investment. While not everyone in the franchise industry follows the best business practices (this is no different from any other industry for that matter), the fact is there are people who can help their clients and coach them through the process.
In the case of the client above, the issue was clear.
He was unhappy.
He had the financial resources to cover the purchase of the business.
He had the experience and ability to be successful.
He had adequate income from his spouse to cover living expenses.
The question that kept driving the client was “certainty”. He wanted to make sure the investment would be successful. What I told him was simple. There is no way to know, as there is risk in EVERY investment. It’s really up to you to be comfortable with the concept of making the change.
This is where most of the discussions go in my franchise consulting practice. While we spend a lot of time talking about business planning, researching the franchise and discussing goals and objectives, it almost always comes down to assessing the risks and overcoming fears.
In my experience, this is something that has to be addressed by the client. It’s up to them to determine if they are comfortable with the risks and believe in both the franchise model and their ability to operate the business successfully. If you find yourself frozen and unable to move forward, take some time to assess your fears.
Are they reasonable and warranted?
Is this something you really want?
If you are not successful… can you handle the impact?
These are difficult questions and one of the reasons the business of franchise consulting is more coaching than sales oriented. In my experience, it’s always advisable to seek counsel from your CPA, financial advisor and a franchise attorney. They can provide helpful guidance to help you make the RIGHT decision for you!
One of the best franchise consultants I know has a great acronym for the word FEAR. What fear represents is:
There is nothing to FEAR!
F – False
E – Evidence
A – Appearing
R – Real
I am in the franchise consulting and brokerage business. What that means is I am compensated by franchisors to sell their system to people who want to own a franchise. Most believe those in the industry are nothing more than sales people. This is the part where those who are more cynical folks chime in and say…
“Hey? Franchise Consulting? Franchise Consultant? Franchise Broker? … You’re nothing but a sales person motivated by commissions!”
Regrettably a number of people in our industry do fit into the category and primarily focus on selling, and while I am not hear to defend franchise consulting and brokerage, I would add there are a lot of good professionals who add a great deal of value to both their clients and industry as a whole.
In fact, while franchise consulting is sales, the practice is more coaching oriented. Our biggest challenge is addressing people’s natural fear of change, as most clients are making a transition from employee to business owner. While fear is a natural part of our psyche, it’s important to not let it lead to INDECISION.
Take a deeper look into the acronym FALSE EVIDENCE APPEARING REAL. The important distinction is false evidence. If you find yourself becoming indecisive about a franchise investment and are looking for some guidance, here’s a helpful strategy.
Acknowledge the fear and determine if it’s real. Here are a few questions that might help:
Why do you want to own a franchise?
What is driving you to want to own your own business?
What type of income does your business need to generate?
What types of resources are available to fund the business?
What excites you about owning a business?
Do you have an additional income streams?
Do you believe this franchise system can generate the income you need?
Is your family, spouse, or partner supportive of your decision?
What are your biggest fears in owning a business?
Let’s face it there is risk in any business. That’s one of the reasons I like the last question. It makes you think about fear. If you take this approach, what you might find is the fear subsides. This allows you to think pragmatically and make a more informed decision.
The purpose of these steps is not to force a sale or force a purchase. In fact, the art of closing a client is helping someone make the RIGHT decision for them. Even if that decision is not to make the purchase. In the case of franchise ownership, it’s certainly NOT for everyone. What’s important is to not let fear become paralyzing. This leads to frustration and indecision… some people call this “analysis paralysis”. If you find yourself in this position, consider the above referenced questions. They just might be helpful in overcoming the fear and making a more informed decision.
I was recently contacted by a colleague who had a friend considering a franchise investment. The person was looking for a website that provided unbiased information regarding specific franchise concepts. This is one particular area that can be frustrating with franchise research. Most websites in the franchise space are designed to be lead generators. You request information and are soon contacted by a sales representative or franchise broker. While this is a very common business practice, and there is nothing wrong with franchises using the Internet to try to make sales, it can be very frustrating for people who are simply looking for basic information.
There are 3000+ franchise concepts available in the market today. With so many options it can be very difficult for people to determine the best option, as the process is overwhelming. If you are serious about franchise ownership, but not necessarily ready to speak to a concept directly here are a few steps that can help you with your research.
Determine the income you will need to support your current lifestyle – Think of it this way. If you were to change your job, what would be your salary requirements? Don’t forget to factor health insurance!
Create a personal balance sheet – This will help you determine what assets are available to purchase a franchise. If you need assistance speak with your CPA or financial advisor. Remember to factor working capital for business and living expenses as it will take time for your business to generate a profit.
Assess your skills – Are you good at sales? Managing Employees? Budgeting expenses? Business planning? In my franchise consulting practice, I always suggest clients to list their strengths and weaknesses. Certain franchise systems require different skills to operate their business models.
What type of business would be ideal for you? –Do you want to work from home? An office? A retail store? Do you prefer to sell a product or service? Do you want employees and do you like to manage people? How many hours a week do you want to work? What days do you want to work?
What do you know about franchising? – In my franchising consulting practice, we spend a lot of time educating people about the industry. While there are benefits to owning a franchise like brand recognition, training, support and a proven business model, there are additional costs like franchise fees, royalties and advertising fees. Before researching specific concepts, take some time to learn about the industry. This will help you determine if it’s a suitable option and better prepare you for your research.
When people start looking for a franchise, they almost always start by looking at specific concepts. While that can be fun, it can also be overwhelming and frustrating. If you are seriously considering a franchise investment, I suggest following the above referenced steps. This is a process we go through in my franchise consulting practice. It helps clients learn about the industry, determine if it’s something they want, and target specific opportunities aligned with their objectives. It’s a more organized approach that will reduce frustration, save time and help make a more informed decision.
There are a number of benefits to owning a franchise. If you took a survey of franchise industry professionals, the list
Does the franchise have a good SYSTEM?
would likely include:
Training & On-going Support
Site Location and Build-Out Assistant
A Proven System
For this article I wanted to speak about the benefits of a system. In my franchise consulting practice I have worked with a number of franchises to help them refine the system and establish procedures to help replicate it. That’s one of the keys to a successful franchise model. Can we establish steps and procedures to train someone to operate the business.
When I work with clients, most tend to focus entirely on “brand recognition”. If they have heard of the model, there is instant credibility. In fact, if I present both a well-known franchise with a franchise that is not as well known, a candidate will almost always gravitate towards the model they recognize. This can sometimes be a trap as there are other factors to consider. In addition, just because a brand is recognizable, doesn’t mean it’s successful.
For example, here are a number of well know franchises that have had problems in the past. Feel free to click on the associated links to read more about the problems these particular brands have had in the past.
Quiznos – Flaw within the system making it difficult to generate an income. They recently had a reorganization of their entire business.
Cold Stone Creamery – Required franchisees to purchase inventory from corporate relationships making it very difficult to generate a profit.
Please note, I am not here to bash a particular franchise system. If you perform enough research, even the best franchise brands will have some litigation history as well as people who failed. The point here is to not fall for the trap that name recognition means success.
That’s why I always ask clients these questions in my franchise consulting practice:
What’s the most important thing in a franchise for you, name recognition or a successful system?
If you found a franchise and you were confident in the business model, but didn’t recognize the name would that matter?
The reason I ask these questions is identify the what’s important to the client, and also educate them that there is more to a franchise than brand recognition. In fact, there are some lesser known models, and models in recession resistant industries that are very successful.
Here are some brands I like:
Service Team of Professionals – This franchise is in the restoration business. The company was founded in 1971 and started franchising in 1996. They currently have 45 franchisees. They have a great track record of success and have 95% franchisee satisfaction.
Certapro Painters – This brand is more well known. Certapro started offering franchises in 1992. They currently have 300+ units. It’s a great system with an excellent marketing strategy that also has strong franchisee validation.
College Nannies & Tutors – CNT opened for business in 2001 and started offering franchises in 2005. They currently have 79 units in operation. I like the system and their validation process. Two years ago I placed a client with CNT who has since been honored as one of their top franchisees.
These are just three examples of models you might not know. They have excellent systems and validate well. They could present a great opportunity for people who have the skills, financial resources and interest in the industry. While brand recognition can certainly be a great benefit, if the system is flawed doesn’t work then there is no value. If you’re serious about franchise ownership, try to avoid worrying too much about the brand and pay more attention to the quality of the system. You will be glad you did.
In my franchise consulting practice I often get questions from people about the benefits of franchise ownership. Some people prefer franchise ownership versus starting their own business because of the training, support, the system and brand recognition. While all of these concepts are important, one area I find particularly critical is the MARKETING.
Let’s face it, if you have a steady flow of leads that are willing and able to buy your product or service it means more REVENUE. That’s what you want as a business owner. More revenue covers expenses, pays salaries, provides capital for expansion and increases the VALUE of the business.
That’s what the best franchise consultants do when they work with emerging brands. If your marketing a product, you have to clearly define your target market, your unique selling points and have a carefully crafted marketing message to deliver to potential customers.
If you happen to be an emerging franchise concept, can you honestly say you have a clearly defined strategy to help new franchisees acquire customers quickly? If the answer is no… then I would suggest spending some time to address this need. If you don’t have a defined marketing strategy, how can you help your franchisees increase sales?
Here’s an interesting story. I once had a franchisor reach out to me to get my opinion of their system. She was kind enough to invite me to a presentation where the founders were speaking to franchise consultants, brokers and potential franchisees to learn about their business. Since we’re friends, she wanted me to listen carefully to the message and provide an opinion of the content presented.
After the call she was excited to hear my feedback. Before giving my opinion I asked her what type of feedback she would like. I asked if she was ok with me being “brutally honest” or perhaps provide some basic thoughts. My colleague had stressed to me they we’re having trouble selling the brand and needed help. She wanted me to be completely candid.
I had the green light, and with her permission I was clear… It was one of the WORST presentations I’ve ever heard, and the reason is they failed to clearly demonstrate how the franchise would help the franchisee acquire customers. The presentation spoke too much about the opportunity and failed to provide basic details regarding the marketing. Again, how can your model be great if you cannot articulate how the franchise helps their owners market the product?
With this in mind, I asked her a basic question. How does the franchise get customers?
The answer… “guerilla marketing”.
While guerilla marketing can certainly be part of the marketing equation, I think you need to provide a little bit more if you are going to get someone to invest $150,000+ in the system. It’s a major flaw in their growth strategy and needed be addressed.
That’s where you really have to be careful if you’re considering a franchise investment. Sometimes we tend to get too caught up in the opportunity and don’t focus on the importance of marketing. That’s the key element to getting more prospects and revenue. Understand how the franchise can help drive customers to you. This will go a long way towards helping select the best franchise opportunity for you.
I recently participated in a Linked In discussion regarding the top five reasons franchisees fails. The discussion
Why does a franchise business fail?
involved a number of franchise professionals including franchise consultants, attorneys, brokers, franchisors and franchisees. The discussion generated 40 plus comments and I thought it would be interesting to share the reasons discussed. Listed below are some of the responses. Please note they are in no particular order:
Not enough marketing
Poor closing skills
Poor franchise system
Bad hiring practices
Poor communication skills
When you get franchise consultants and brokers (the sales folks) J in a discussion with franchise attorneys, especially litigators J who often deal with people who have regrettably lost money it can make for an interesting and sometimes heated discussion. While that might seem to be problematic for some, for those of us in the franchise industry, particularly franchise consultants and brokers, we tend to have very thick skin J.
There are a variety of opinions within these groups. Some folks are very “metric oriented”. They prefer measurable data to determine the basis of an opinion. Others based their reasons on personal experience and discussions with franchise consultants, franchise owners and brokers. While it would be nice to have detailed data to support the reasons, regrettably, there are so many factors involved that can make it very difficult to completely understand why a franchisee fails. In this discussion, what I found interesting was 9 of the 10 reasons focused strictly on business factors and only one focused on personal factors… alcoholism and drug addiction.
This is why I think it can be very difficult to fully quantify why a franchisee fails, as there are so many variables, particularly on the personal side that can impact a business. I am not sure if anyone has ever researched these issues, however, I would be very interested to learn about the results.
Owning a business or franchise is more than simply sales, marketing, budgets and capitalization. It’s a lifestyle, and owners can sometimes encounter painful and often unforeseen events that can have a lasting impact. Some of these issues can include:
A death in family
Special needs children
These personal factors are rarely considered when trying to determine why a business fails. While I am not certain that anyone has done research on this topic, I would be very interested to see the results. If I had to guess, I would not be surprised to learn if personal factors played more of a role in failure than many of the items we discussed.