The 5 Parts of Franchise Development Success

The 5 Parts of Franchise Development Success

Franchise development department success depends on five different pieces fitting together in an organized and precise manner: 1) the company website, 2) promotional materials, 3) the FDD, 4) franchisee validation, and 5) discovery day (the office visit). Let's discuss these five critical factors and make sure your system is tuned up to achieve the best results.

1) The company website is your most effective tool for conveying the culture and excitement of your franchise offering. The recruitment website should be updated quarterly or even monthly to reflect new information about your concept, good news about your franchisees, and any new public relations stories that highlight your brand. Current news and information will keep interested candidates coming back and watching the progress of your concept. You should also test the website weekly to make sure all the forms are working and that the franchise inquiries are going into your CRM system in a proper manner. I'm always amazed when working with new clients the number of times that the phone number is incorrect, or that the form fills aren't working correctly. If this not monitored often, it can be a costly mistake. The same attention should be given to the paid portals to ensure that the inquiries also are being transmitted correctly to your CRM system.

2) Promotional materials. Most promotional brochures and information are now digital, so make sure you update the files with current information, just as you have with your company website. Also make sure that any embedded links to articles and other information are working properly and that all materials are current.

3) The FDD is the most important document in the process for several reasons. Most important, it's the legal vehicle that allows you to offer franchises. It also can become one of your best sales tools - if you devote the time and effort to involving all the departments in your organization, ensuring that each section pertaining to them conveys the correct and current information on how the business operates today. Also typos and errors need to be discovered internally, which takes several sets of eyes proofreading the document. There's nothing worse than errors in the FDD that allow a candidate and their attorney to get the upper hand; nor will it leave a professional impression with the candidate about your attention to detail.

4) Franchisee validation is one of the most important steps in the process. Without good validation of the franchisor's systems, support, training, marketing, and an overall feeling of a partnership, it becomes very difficult to grant franchises to new candidates. One of Murphy's Laws of Franchising is: "Franchisees will say good things about your system until asked by a candidate." That's a little tongue-in-cheek, but there's more validity to that statement than we may give it credit for.

As a franchisor, it's important to know how your franchisees perceive the system and the support so you can manage to those expectations - and not lose great candidates just because you didn't take the time to find out. Mystery shopping your franchisees to learn what is being said to candidates is an invaluable tool. Once you know how and what is being said to your candidates, 1) management can work at doing a better job in the areas that are lacking, and 2) you can set expectations for your candidates and help them prepare better questions.

It is important to communicate with your existing franchisees on what to expect from candidates when they are making the validation calls. It is even more important to coach your candidates on how and what to ask the existing franchisees. This is not an obligation of the franchisees, but a favor to the franchisor. Make sure your candidates understand the time limitations of your franchisees and that you've created a system for this process to follow. We've found that having your candidates send an email with potential questions and setting a time with an existing franchisee seems to be the most effective method for completing this step in the due diligence process. Several companies use passwords or some sort of key so that existing franchisees know the person is a viable candidate in the process and not a competitor shopping them.

5) Discovery day should be no more than a confirmation of the information gathered by the candidates during the research process. This information should be delivered by the franchisor's support staff and be organized so that it can also be placed in handouts for the candidate to take with them after discovery day.

Granting franchises to quality candidates takes a system that all participants are aware of and understanding the importance of accurate information. Take the time to review all of your steps and make sure your franchise system is the best it can be.

Marc Kiekenapp is President and CEO of Kiekenapp & Associates, a full-service management and sales consulting company dedicated to building notable franchise systems - from concept feasibility analysis and packaging through delivering single-unit and master territory franchise sales. Contact him at 866-696-8521 or marc@kiekenappconsulting.com.

Published: September 3rd, 2014

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