Franchise Update Magazine Issue IV, 2015 | Page 58
GROWING YOUR SYSTEM
Challenge the pros
“DISCUSS THE IMPORTANCE OF
FRANCHISEE VALIDATION AND HOW YOU USE IT
AS A SALES AND DEVELOPMENT TOOL.”
Michael Powers
Managing Director
Painting with a Twist
Unit franchise growth is the fuel that
supplies life and sustainability to every
franchisor’s existence. Without significant
annual unit growth, your
brand and market share will
eventually erode away while
your growing competitors
will gladly capture the excess and continue to grow
their own brands. Simply
put, you are either growing or dying. And in today’s
competitive franchise environment, the latter is not
an option for any franchise
organization.
Franchisee validation
can heavily influence your development
success, whether you’re an emerging
franchisor or a large established one.
Conversely, a franchisor may employ alternative temporary strategies if they are
not receiving positive validations from
their franchisees. In any case, and with the
proper relationship, getting franchisees to
validate should be a willful act of genuine
satisfaction with the franchisor and the
brand they invested in. Most candidates
weigh franchisee validation as heavier and
more valuable than the home office pitch
and presentation.
In my experience, a franchisor’s preparation and intent to create positive validations has been the key to getting them.
To earn honest and frequent validations, a
franchisor must be properly aligned with
its franchisees, must hear and resolve challenges that franchisees face, and have a
constant focus on improving unit financial
performance. The benefits of franchisee
validation to the franchisor and the system go well beyond the validation itself.
Even if franchisee feedback is less than
favorable for the franchisor, the act of encouraging conversations between candidates
and franchisees exemplifies an openness
and transparency between the franchisor
56
and candidate at the onset of the process.
Important constructive criticism will most
likely be fleshed out in the process, and
the franchisor then has the opportunity to
rectify issues it may not have been aware
of. With proper support and home office
collaboration, a franchisor’s
worst critic can change their
tune and become the system’s best validator.
The purest lead conversion will come by way
of franchisee validation.
Strong validations also will
instill more confidence in
new franchisees during the
early stages of opening and
will set positive expectations from day one. The
most valuable validations
are not solicited or incentivized by franchisors—they are earned and deserved.
Cameron Cummins
Vice President Franchise Development
Marco’s Pizza
One of the first things we tell our potential franchisees is that we do not sell a
franchise. Rather, we present a business
opportunity and let prospects see if our opportunity
and our culture are a match
for them. The word “sales”
does not appear anywhere in
our Marco’s vocabulary for
the simple fact that we are
not selling a franchise. We
view franchisee validation
not as a sales process, but
as an exploration process.
The key to franchise
development is that it’s all
about the validation. Prospects need to fully understand what they
are deciding to get into. They should be
investigating and doing their own research
on the business model, the franchisor/
franchisee relationship, and specific roles
and responsibilities. This is too important
a decision to be “sold” to someone. Both
sides have to do their own research to be
comfortable that this partnership is the
right fit, one in which both parties are
going to prosper together.
The natural first step is to go to the
franchisor for top-line information, but the
vital information comes from those actually living out the role that prospects are
interested in signing up for. The linchpin
of deciding whether or not the role of a
franchisee is the right fit is best answered
at the franchisee level. Prospects expect
corporate representatives to speak positively about the brand. What they need
to be doing is speaking with the people
they will be working with side-by-side and
borrowing cheese from. This way they get
the answers they need.
Franchisee validation becomes extremely
important as a franchise development tool
because it is a peer-to-peer discussion with
the field team that is executing business on
a day-to-day basis. It is our job to facilitate
this learning process.
First, we ensure that they understand
the FDD, have them fill out the application,
and then move on to the next step, which
is making sure they speak with someone
outside the corporate office. During our
discovery days we encourage prospects to speak with
as many franchisees as possible—single-unit, multiunit, new, veterans, etc.—
and we work with them,
based on their criteria, to
identify and connect them
with various owners and
guide them with the hardhitting business questions
they should be asking.
Prospects are encouraged to learn from their
own explorations so that when they do
have meetings with stakeholders they can
articulate what it is they are getting into
and why. This education better prepares
them for future success in growing their
business. n
Franchiseupdate ISS U E IV, 2 0 1 5
fu4_grow_challenge(56).indd 56
11/16/15 3:59 PM