Discovery Day Part 1: Fundamentals
In my book, Grow to Greatness: How to build a world-class franchise system faster, I present the Six Steps to Selling Success. Step Five is Discovery Day.
Discovery Day is show time! Whether you have one franchise or a thousand, this special event propels your sales process to a crescendo. It's "Confirmation Day," where serious buyers come to you ready to join your franchise with the blessing of your approval committee. It's always my favorite stage of the process, when everything becomes real for your candidate and you. The journey of rigorous courtship has led both candidate and franchisor to your altar of consummation.
To ensure success, your Discovery Day must always meet or exceed the buyer's expectations. Anything less, and you must clean up your act quickly. Invest whatever it takes to make this event work.
There is wide variation in the preparation and professionalism of home office presentations for qualified franchise candidates. Some companies focus their entire recruitment process toward scheduling the Discovery Day event, while others view it as an optional trip for potential owners who want to know more about the franchise.
Surprisingly, a few franchisors have recently eliminated their Discovery Day. I know of an automotive franchisor who decided, "It slows down our sales process because of travel preparation and scheduling. We now try to take care of this without the home office visit." A food franchise executive explained to me, "It drains our resources by tying up our executive staff for the day. We can't afford to take the time." Wow, I thought, you can't afford not to take the time! I spoke to a successful founder of fitness centers in the southeastern U.S. who was trying to upgrade the quality of her franchisees. Her first 30 owners had never come to her headquarters or met her staff. I asked, "Would you ever hire any corporate or field employee without meeting them? Yet sight unseen, you are awarding 10-year contracts to individuals who will operate and market your brand throughout the U.S!" The founder realized the hard way this was not a good thing and changed to mandated Discovery Days.
Home office visits are anything but an option in the sales process. They are a must for franchise candidates. High-performance franchise organizations know this event is critical in successfully qualifying and recruiting franchisees. It also is an invaluable experience for candidates to gain firsthand information, meet the staff, see the culture, and validate their expectations of the system. For franchisors committed to building a quality system, the days of waiving Discovery Day are over!
A well-designed sales process should produce a minimum 70 percent closing rate of potential buyers who attend Discovery Day. A 100 percent closing rate is too high, and usually signals that cashing franchise fees is more important at the moment than the higher costs of managing or terminating "misfits" down the road. Some top-producing development pros are closing 90 percent of their qualified candidates. They credit this to their screening process and focus on developing a superior experience for their home office visitors. Here are some guidelines for cross-checking your Discovery Day program. (More to come next month!)
Get financing pre-approved
Before investing time and money in a home office visit, Discovery Day attendees should get their funding in order through a third party or direct financing program. Clearing this obstacle paves the way for a more productive Discovery Day. Yet some franchisors skip this preliminary procedure and instead, at the event, provide qualified attendees with sample business plans to present to lenders when they go home. This doesn't make sense for either party. Potential buyers want to know early on if they can qualify for funding. Why waste the time if they can't? Lenders are more than happy to spend 30 minutes or more to determine if a potential client is pre-qualified for financing. This step speeds up the closing process and reduces wasted energy with prospects who "don't have the dough" to make it.
Analyze individual vs. group presentations
Track your current closing rates to establish which environment may be more suitable and successful for you. A home-care franchisor discovered their greatest success with personal, one-on-one Discovery Days. Yet an advertising franchise found group presentations far more productive for their recruitment success. Their vice president of development said, "The presence of several people further validates our concept, and the enthusiasm of the attendees feeds off of each other, creating additional interest." At one franchise I represented, we noticed a tendency of more multiple-unit purchases when we had larger Discovery Day groups. Some wavering participants bought more than one unit after speaking with others who had committed to several units. (I'm not saying this was a positive, just an observation about group dynamics.)
Carefully script your event
Every activity at Discovery Day must be analyzed, rehearsed, and monitored. Your goal is to make a positive impression on the candidate. Your franchise system is on stage and must exude professionalism, organization, and leadership.
According to a study conducted by Dunhill Personnel many years ago, 85 percent of what your prospects absorb at Discovery Day is visual, not informational. Minor details create major impact. What attendees observe greatly influences their decisions to join your system. "By whom and in what car was I picked up at the airport? Were employees friendly and interested in me? Was my name posted on the company sign? Were the employees well-groomed and dressed appropriately? Did I relate to and feel comfortable in your environment? Was the home office well-maintained or were the bathrooms dirty? Did I get to meet the president or CEO?"
To illustrate the power of what's really important to some buyers, Once Upon A Child, a children's franchise, snatched a strong candidate out of the arms of a competitor at the eleventh hour. The new franchisee changed her decision because "the people were much nicer and I really sensed they were happy working for the system." In another instance, a direct-marketing franchise beat out a competitor when their CEO offered his guest room to a highly qualified prospect whose evening flight was cancelled by bad weather.
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