Fine-Tuning Your System: Validation Plays a Critical Role in Conversions
Welcome to the ever-changing world of franchising! Just when we all think we have things figured out, a new challenge arises. The economy!
As I recall, we were all chugging along running our ad campaigns, generating leads, and (hopefully) converting some to qualified candidates. Guess what? Pipeline paralysis! Not that lead volume has fallen--on the contrary, lead flow is rising, right about in lockstep with the unemployment rate as more people are compelled to explore business and franchise ownership options. Yet as lead volume has increased since the clock struck 1/1/09, we are now faced with a new challenge: how to effectively position our business in a troubled economy and actually get qualified candidates financed and into business.
While certain industry categories are affected more than others in today's franchise sales climate, "forward thinking" franchisors are creating new programs to stimulate activity for existing franchisees and enable effective market entry for new franchisees to put them on an accelerated track to positive cash flow.
As tough as things are these days, a down economy affords all of us an opportunity to get better at what we do. When economic conditions are flourishing many franchisors and franchisees are able to coast along, cashing in on "easy times." They don't spend the time and effort to fine-tune their systems, research cost-saving methods, or test how to more efficiently operate their franchise business. Progressive franchisees and franchisors have an opportunity to prosper during this period… if they just accept the fact that we all must change the way we are doing business and adjust to the "real world."
Franchisees are the key to the success of any franchise sales effort. Profitable, happy franchisees are the absolute deal maker (or breaker) for today's candidates, who have a bouquet of excuses available to decide against buying. If your system does not validate favorably, it is time to tune it up! This is not an overnight task.
When asked, most franchisors will defend the quality of the franchisees in their system. Most franchisees are more likely to be more candid with a candidate coming into the system than they are with the home office team. It is important to know how your franchisees really feel so you can identify their issues and assist them with training and support and address any attitudinal issues that are poisoning your system.
If your sales team is coming back to you with increased validation issues, it's time for the operations teams to get in the field. We very rarely award a new franchise without the help of several of our franchisees talking with the prospect. Don't waste advertising dollars and the sales team's time if poor validation continues to derail otherwise interested and qualified candidates.
Mystery shop both your franchisee validation and the sales team's process to ensure you have your systems buttoned up and that you are having the correct conversations with candidates.
This is an ideal time to think out of the box with the operations and the sales teams on what candidates are asking for and what issues they feel are holding them back from purchasing the franchise. Is it entry costs? Lack of confidence in the product/service? Financing? Or any other barriers a candidate would mention?
Candidates are scared and uncertain of what to do next. They need encouragement from both the sales team and the franchisees. Don't dodge the issues. Bring up the economy before they do! Talk to them about the programs your company has put together to operate more effectively, and why your business will work well today.
Don't over qualify because you're worried they won't get financed. Don't completely change what has been working for you in the past. It's just a matter of showing the same concerns about starting a business now. Get your candidates excited about the business. They called you! They know their 401(k) and job are not in their control, and that if they get into their own business they will have more control.
Controlling your own future today could be one of the most compelling reasons to get into business for oneself. We've all lost enough freedom and money letting others make decisions that affect us and our families.
It is time for opportunity for all of us willing to take a look in the mirror and critique ourselves and our businesses and make them the best we can. If we do this, we will be successful and stronger for the effort.
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