Getting It Right With Your Franchisees

Core values are today's "X factor" in franchise development. To succeed in this business, franchisors must effectively position their concept in the marketplace, offering compelling benefits to both customers and potential franchise buyers. By creating a dynamic culture you'll add a powerful dimension to your brand, which can catapult your organization beyond the competition.

Dick Rennick, founder and former CEO of American Leak Detection, was named Entrepreneur of the Year at the 1998 IFA Convention. What was so stunning about this celebration was witnessing the nearly 100 franchisees who had flown in at their own expense to celebrate and validate their leader's compassion, values, and relationships instilled within their system. Dick's inspiring comments focused on his owners and employees, the builders of his successful franchise family. An explosive, standing ovation followed, bathing the general assembly in the infectious warmth of his franchise fans clapping, whistling, and cheering for their leader. This extraordinary ceremony of franchisors and franchisees has never been duplicated at an IFA convention in the past 25 years. We all experienced the power of corporate culture at that momentous event in Dick's business life.

Rennick also received the "Lifetime Achievement Award" in 2006 from the American Association of Franchisees and Dealers (AAFD), recognized for developing fair, franchisee-friendly franchise documents. Dick's humanitarian actions expanded to the consumer population throughout the U.S. He founded and championed the Franchise Emergency Action Team (FEAT) of participating franchise systems that have donated many hours, services, and products to assist U.S. communities during times of disaster. Rennick had the "X factor." He created culture, inspiration, and pride within his franchise organization, and made a difference giving back to the general population when it mattered most.

Recognition and rewards

Show your franchise partners that you care. Most franchise owners want to be recognized and rewarded for their achievements. If they didn't, most franchisors probably wouldn't want them as part of their system. Find ways to thank owners for their contributions. Newsletters, meetings, conventions, phone calls, personal letters, and visits are multiple opportunities to show appreciation for your owners, both one-on-one and among their peers. "Showcase" your top producers. Reward them for their winning spirits and what they have achieved in building successful businesses.

Franchise owners buy into your message that they are joining a family of franchisees who share and exchange ideas and best practices within an active network sharing common goals. They like the fact that franchising is a people business, and is relationship-driven between the franchise owners and the corporate team. Group power and the value of "on your own, but not alone" was certainly an attraction that drew me to join a franchise system in 1980.

About 15 years ago, I visited a former master franchisee of a 3,000-unit cleaning franchise who had developed one of the top regions in the country. Because he was a big producer, corporate headquarters frequently recommended franchise candidates visit his operation. The owner would spend hours with these prospective buyers sharing his business successes and promoting the franchise organization. As a result, candidates who bought into the program would occasionally call and thank him for taking the time to visit and answer their questions.

Unfortunately, corporate headquarters never recognized the master franchisee for helping out, which really bothered him. Corporate failed to recognize his support by spending time with these buyers, not once applauding him for promoting their system. "I wasn't looking for a referral fee, all I wanted was to be recognized for my efforts." The master eventually sold his region and started his own franchise program. Never lose touch with your franchise owners, no matter how large your system becomes!

How recognition inspires owners

The power of recognition often motivates franchisees to achieve greater accomplishments and give back more to the system. In 1983, during the opening ceremony of our national convention, my mentor and partner Frank Duffy and I were crowned franchisees of the year before a few hundred peers and their families. For the next three days we were rock stars, basking in the limelight of other owners. They wanted to speak with us, asked if we would spend time with them at the event or by phone after the convention. "What were our secrets to setting new performance records? How did we successfully attract and develop our employees when they couldn't? What advice could we provide to help them with their circumstances?"

I really felt good sharing our successes with our franchisee partners, who could benefit from our contributions and experience. It was a special moment of celebration and personal growth. I realized then how recognition and reward fuels the strength of franchise networking. Years before that event, we were the students gleaning information from our business neighbors. Now Frank and I were the professors with the ability to give back to others.

This is an excerpt from my book, "Grow to Greatness: How to build a world-class franchise system faster." To order copies, click here.

Data Driplets

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Source: 2011 Annual Franchise Development Report

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