The franchising business model is one that many get wrong from the start – it’s not just about dominating a market (if you so wish)...it is also about creating a business opportunity for another individual/s.
A certain amount of savvy is needed to put a viable franchise model together and a degree of profitability will always be part of the business model. But...and there is a big but here – when putting the VIABLE franchise model together, I really do advise the prospective franchisor to brainstorm about how he/she can make this business opportunity the best thing since sliced bread.
What I love about the franchising concept (from the franchisor’s) perspective is that there is a huge opportunity of having some fun and creating an astonishingly attractive business opportunity together. Remember that Franchising is becoming more and more competitive and the more planning and thought the franchisor puts into developing the model – the better the offering will be in comparison to other franchise models.
From a best practice perspective I have always steered my franchisor clients towards the avenue of working towards a code of practice and/or rules of conduct. What I mean by this is in having an identifiable ‘stamp’, if you will, which will stand out to prospective franchisees that you are a franchisor with integrity and an active interest in the betterment of the franchisee’s investment.
Franchising is a two-way street – the franchisee invests in the franchisor’s model and formula; and the franchisor creates the working environment which will support the franchisee towards a path of success and business goal fulfilment. That, I feel, makes franchising a selfless business model and every prospective franchisor must evaluate whether he/she has the right inclination for using this model or not. If they don’t, then they are better served choosing a different growth route.
To be a successful franchisor and have a franchisee network that grows from strength to strength, there needs to be an inherent partnership of goodwill, motivation and mutual benefit. There also has to be a balance of nurturing the entrepreneurial spirit, as well as respect for the authority of the franchisor.