Objective: Grant the franchise to qualified buyers on Discovery Day or soon after
Length of meeting: 30 minutes to 2 hours
Executive review committees typically are composed of senior franchise executives who review a candidate's qualifications before granting them a franchise. If you are a founder just starting up your franchise, employ a close business associate, franchise consultant, or other trusted advisor to be a part of your review committee. They can help in your decision-making process and provide greater credence to your professionalism.
At the conclusion of Discovery Day, it's the committee's decision on whether to extend a franchise offer or to disqualify a candidate. Successful franchisors prominently position this venue as the final qualifier in granting new franchises to prospective buyers. It's a legitimate "country club" approach that helps safeguard the future of both the organization and prospective franchisees.
Here's what your committee of advisors must decide: "Is this individual a good fit who can be successful and make a contribution to the system?" or "Is this a person who really doesn't match your franchise profile and will probably create problems for both of you down the road?"
For franchisors using Discovery Day as "signing day," committee-approved candidates sign agreements and pay their franchise fees at the conclusion of the event. Celebrate this memorable occasion with your congratulations, photo shots with senior executives, and company logo gifts. Now the franchisor and franchisee join together in their journey to build a rewarding business partnership.
It's not a pleasant moment when you inform your prospect they are rejected by your review committee. Out of respect for the candidate, it's imperative to give them the specific business reason(s). Just as you want to know why qualified prospects pass on your opportunity, these prospects deserve the same from you. Legitimate reasons can include:
"We are concerned you don't have the necessary social and networking skills demanded for our concept."
"Our training people believe you will be overwhelmed with employee management, hiring, and training responsibilities."
"Executive management has decided you aren't currently in a position with your heavy family commitments to dedicate the 12-hour days and energy to start up your business."
"The consensus is that our franchise procedures and policies are too restrictive for you and will frustrate your ability and motivation to grow within our organization."
Make it clear that your particular franchise simply isn't right for them, and explain why. If you care about the welfare of the individual and your franchise system, disqualifying candidates is not a personal attack on the candidate. I've certainly had the displeasure of delivering bad news. A wonderful, physically challenged woman who qualified in all other aspects was rejected because it was evident at Discovery Day she didn't have the energy or stamina to operate our fast-paced business. Another gentleman had difficulty communicating with our operations and training executives, which would affect his learning potential as well as unfairly burden our support team.
My toughest rejection was disqualifying a proud husband without the skill sets to manage the franchise. However, we were blown away by his wife's business acumen, personality profile, and passion for our concept. We said we would award the franchise if his wife would join him full-time as co-operator of the business. Unfortunately, the husband flatly rejected the idea. He still carried the mindset of his traditional culture, which prevented him from agreeing to our requirements.
Most franchisors approve candidates and award franchises immediately after the event. Their intent is not to sign up new franchisees at Discovery Day. If you're wondering, there is no right or wrong way. In successfully using this post-award process, the key is to contact the buyer the day after Discovery Day and lay out the steps to signing.
I've seen time, indecision, and lack of follow-through kill post-Discovery Day deals. Executive leadership must give franchise closings top priority within their organization. Losing a five-store, multi-unit deal because it took three weeks to get the territory defined and contracts out is utterly tragic. Time kills deals. Buyers expect responsiveness, are highly impressionable, and can be easily diverted when too much time elapses. This is nothing less than we'd expect for ourselves.
Quick tips to accelerate closings
This is an excerpt from my Amazon.com best-selling book, "Grow to Greatness: How to build a world-class franchise system faster." To order copies, click here.
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