Great Expectations: This Is A Great Time To Be In The Franchise Business!
What a great time to be in the franchise development business! We have the advantage of an election year, talk of recession, high interest rates, poor housing starts, and rising unemployment rates.
Are you serious? Has this "franchise guy" lost his mind? What is he talking about? Where is he coming from? I hope this is sarcasm.
After 28-plus years in the franchise industry I've been fortunate to have prospered during two or three of these cycles in the economy. And I believe if you keep your head on straight, you can do the same. I want to start out with a quick story from my early years in franchising to help you understand where I'm coming from.
Twenty-five years ago I was having a meeting with several managers from Decorating Den. They were astonished at some of the new owners' high sales figures in the month of December, which had been historically a slow time of year for the decorating industry. I asked them why December was considered a slow month. The answer took me by surprise when I discovered that in training we were telling the owners that December was a slow month. So guess what? It was a slow month. With further investigation, we discovered that the new trainer had forgotten to tell the new owners December was a slow month. So guess what? They did great!
During our current cycle of events you need to be prepared mentally--along with having your franchise system prepared to assist franchisees through the process and financing.
The sales consultant has to stay positive and remember why the candidate called in the first place. Why? Because the same pain at work occurs no matter what year or economic condition is being reported. You should be prepared to talk about what is going on in the economy, not what is reported on TV. You must be prepared to work with the candidates' perception of what media or "outside" consultants are saying and have solid answers on why the venture they are about to launch will be fine.
The prospects will always have reasons they can't move forward. I know you've heard most of them: Can't leave my job and security; my wife doesn't like the name of the franchise; I don't want to pay royalties; and on and on. Now they've been "coached" by the media and influenced by friends about the economy, interest rates, and even a possible recession. So as a sales consultant, I want to thank them for helping us stay focused on the prospects' concerns.
Okay, half of you are saying this franchise guy must be wearing rose-colored glasses, and another half are thinking maybe he's got something here. Either way, here are the items that I focus on when awarding franchises during unsettled economic times:
- Success stories
Attitude is the most important attribute for both you and the prospect.
Perception, I've learned, can be reality to the person delivering the negative statements. Do not accept perceptions. Question them until they become reality. Remember that the prospect called you to inquire about a franchise, so they must be interested!
Reality to me is asking the "hard questions" so you can qualify the true interest of the prospect. I would be focusing on the fears of leaving a "secure" job and family support even more than at other times.
Success stories are never more important than when the perception is that the "sky is falling" in the media. Take the time to deliver positive stories of franchisees' success in the marketplace.
Financing is a significant part of the process. As the housing market slows, the home equity financing avenue is tougher. I suggest you work diligently with a financing source of your choice that can assist your prospects in "creative" financing such as retirement rollover, SBA loans, conventional, and lines of credit. It may take a few different avenues of financing today, but having this relationship established before time is key.
In summary consider going on a "media diet." Watch less national news and realize that if you don't watch the TV for a couple of weeks your attitude will be much more positive. I wish we could ban our prospects from the tube as well! Keep the Attitude, champion your American dream and the rest will follow.
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