Since the beginning of franchising, there have been principles that ensure that a franchise system grows and prospers. These principles of franchising have never changed. They represent a foundation in which every successful franchise is built. It’s also believed that those who understand and adopt these principles of franchising will undoubtedly find success.
Below, I’ll share a few of these principles to help you start on your path to success.
Franchisors Should Disclose All Information Upfront
First up on our list of principles of franchising that never change is franchisors disclosing information to potential franchisees upfront. Honesty though, this is not only essential for having a long-lasting relationship with your franchisee, but it also plays a significant role in your franchise’s overall success. It helps avoid creating false expectations, such as saying that finding success is easier than it actually is, and being honest is a building block in your franchisees trusting and confiding in you.
Potential franchisees should also have access to the company’s franchise disclosure document (FDD). This document contains information about the franchise, ownership, brand, operations, and past legal trouble. All of which equip franchisees for a career with your franchise.
Franchises Should Make Money
When it comes to building a new franchise, it must be structured so that the business can be profitable. After all, the point of owning a business is to make money. In addition to offering proper training, a franchisor should be responsible for ensuring their franchisee has all the tools they need to succeed. These tools can come in many forms, including informing them about all of the expenses they’re required to pay and keeping said expenses reasonable. A franchisor should not be the reason why their franchisee falls flat upon launch.
Franchisors Must Offer Proper Training and Support
To be successful, you must first be set up for success. One of the reasons entrepreneurs prefer franchising over starting their own business from scratch is the amount of training and support they receive from their franchisor. Having this comprehensive training is a must to prepare them for running their new franchise business and boost their confidence.
Some franchisors may not be able to dedicate the time to provide you with proper training. This can be because of low capital or not enough resources. If this is the case, it’s best to hold off on the onboarding process or investing at all until they can.
Focus on the Long-Term Gain, Not Short-Term Benefits
Franchises aren’t for entrepreneurs looking to make some quick revenue. You’ve got to be in it for the long haul. This franchising principle warns that although franchising often comes with a proven business model and tons of brand recognition, it doesn’t guarantee immediate success. You need to ensure that you have the capital to keep your franchise afloat as you wait for it to start making money.
It’s also important to remember that not every franchisee reaches the same level of success. Some franchisees find success later, whereas others may not find success at all. The reasons for the failure, of course, vary. In some cases, it’s the franchisor’s failings, but in others, it’s the individual franchisee’s missteps. No matter the struggles, be prepared for the ride.
Evaluate Your Franchise Performance
Another one of the principles of franchising is to evaluate your franchise. The ability to self-reflect and assess is a vital part of running a healthy and successful business. Be sure to schedule a time to review your business’ overall performance, including financially. Employing this practice ensures that you’ll always have the necessary information to make an important strategic decision and can bring it to your franchisor’s attention.
Hundred Acre Consulting
Franchising is an industry that’s been successful for decades, and it’s not hard to see why. These five principles only scratch the surface of tips and best practices used by the most successful franchise owners. Our Hundred Acre Consulting team can help you find the same kind of success, starting with finding you the perfect franchise to invest in.
Ready to start your franchise journey? Contact our team today!