THE CHANG­ING FACE OF AUS­TRALIAN FRAN­CHISE RE­CRUIT­MENT

Business Franchisor - - EXPERT ADVICE: JAMES YOUNG -

THERE HAS NEVER BEEN A MORE IN­TER­EST­ING TIME TO FIND, SE­LECT AND RE­CRUIT QUAL­ITY FRAN­CHISEES. ALTHOUGH THE FRAN­CHIS­ING IN­DUS­TRY HAS SEEN A NUMBER OF SET­BACKS, IT’S ALSO SEEN A WEALTH OF GROWTH AND POS­I­TIVE CHANGES. WHILE THE NEG­A­TIVE STO­RIES MAY BE TARNISHING CER­TAIN BRANDS, THE IN­DUS­TRY AS A WHOLE IS STRONGER FOR IT.

We cur­rently have a per­fect storm of bad in­dus­try press, dif­fi­culty ac­cess­ing fund­ing, and in­creased com­pe­ti­tion, with more fran­chises than ever be­fore fighting for a re­duced pool of ta­lent.

There are over 1200 ac­tive fran­chise sys­tems in Aus­tralia, with many more ‘fran­chises’ that have not yet granted their first fran­chise – all out there com­pet­ing for fran­chise part­ners.

Suc­cess­ful net­works grow stronger. Sim­ply put, you at­tract the fran­chisees you de­serve. Fran­chise net­works are find­ing it in­creas­ingly harder to at­tract suit­able can­di­dates, as there are cur­rently fewer qual­ity can­di­dates con­sid­er­ing the fran­chise mar­ket.

Po­ten­tial fran­chisees are more ed­u­cated and cau­tious when it comes to buy­ing a busi­ness. As we are see­ing in the real es­tate world, it is a buy­ers mar­ket at present, and thus fran­chisees come with more de­mands and higher ex­pec­ta­tions. Fran­chisees ex­pect to be a pri­or­ity, and they ex­pect their money and their ef­fort to pro­vide a strong re­turn on in­vest­ment.

So how do you sep­a­rate your­self from the pack and en­sure that you are wor­thy of qual­ity fran­chisees? How do you po­si­tion your­self at the top of the pool and show that your busi­ness is ‘buyable’, i.e. prof­itable, proven and suc­cess­ful?

If you are new to fran­chis­ing and cur­rently launch­ing your fran­chise of­fer, you need to make sure that you have in­vested in the right sys­tems and struc­tures, as well as part­ner­ing with the very best fran­chise con­sul­tants and lawyers. This is to en­sure that your fran­chise of­fer will with­stand the tests of com­pe­ti­tion; fran­chisees with a crit­i­cal eye; fund­ing dif­fi­cul­ties; le­gal re­views; ac­coun­tants test­ing the fi­nan­cial of­fer; and, not to men­tion the tough­est hur­dle of all, the ‘pub test’ – friends and fam­ily who have all heard a hor­ror story with the word fran­chis­ing at­tached to it.

The first chal­lenge for all fran­chisors is linked to find­ing ways to at­tract a po­ten­tial fran­chisee. How do you gen­er­ate a lead and then how do you continue to in­crease the stan­dard of the leads your sys­tem is re­ceiv­ing?

The quick an­swer is that you need to in­vest in all of the touch­points through which your fran­chise cus­tomer will come into con­tact with you. Do you look suc­cess­ful? Do you look like you are worth in­vest­ing seven years and po­ten­tially hun­dreds of thou­sands of dol­lars in?

Your web­site (yes, you need a sep­a­rate fran­chise web­site), fran­chise brochures, qual­ity of mes­sag­ing and fran­chise lead gen­er­a­tion strat­egy need to look bet­ter and func­tion more ef­fec­tively than the com­pe­ti­tion’s in or­der to fight for the best fran­chisee lead. They need to in­stil trust and con­fi­dence in your brand, and your pro­cesses and sys­tems to re­cruit fran­chisees will stand tes­ti­mony to this.

If you were buy­ing a car, you would base your de­ci­sion on a number of fac­tors in­clud­ing cus­tomer ser­vice, brand and price. Buy­ing a fran­chise busi­ness is no dif­fer­ent! Your of­fer needs to be com­pet­i­tive, you need to have a qual­ity brand, and the process for pur­chas­ing the busi­ness should be has­sle-free and invit­ing. Make sure that you have the nec­es­sary sys­tems in place to en­sure that ev­ery stage of the process is achiev­able. Be pre­pared and know what needs to be done. The key to a suc­cess­ful fran­chisee re­cruit­ment strat­egy is hav­ing every­thing you need to de­liver in place. From fi­nan­cial de­tails and le­gal doc­u­ments to ap­pli­ca­tion forms, these should all be pre­pared be­fore you start your fran­chise lead gen­er­a­tion and re­cruit­ment jour­ney.

If you are new to fran­chis­ing and cur­rently launch­ing your fran­chise of­fer, you need to make sure that you have in­vested in the right sys­tems and struc­tures, as well as part­ner­ing with the very best fran­chise con­sul­tants and lawyers.”

The key to a suc­cess­ful fran­chisee re­cruit­ment strat­egy is hav­ing every­thing you need to de­liver in place. From fi­nan­cial de­tails and le­gal doc­u­ments to ap­pli­ca­tion forms, these should all be pre­pared be­fore you start your fran­chise lead gen­er­a­tion and re­cruit­ment jour­ney.”

You also need to in­vest in gen­er­at­ing leads. Cur­rently, our firm – which works with ap­prox­i­mately 25 fran­chisors look­ing to grow across Aus­tralia and over­seas – has an av­er­age in­vest­ment per sale of ap­prox­i­mately $4500. The in­dus­try av­er­age can be quoted at al­most three times this amount. But these re­sults are not just based on the look and feel of your fran­chise of­fer. What we do know is that you need to in­vest in mar­ket­ing in or­der to gen­er­ate leads and be able to take them through the re­cruit­ment process. The key to suc­cess­fully grow­ing your busi­ness is that behind the siz­zle and sales pack there is real sub­stance and proven and prof­itable suc­cess. You need to be able to prove this state­ment and back it up with fac­tual data.

Your train­ing sys­tems, your op­er­a­tions man­u­als, your fran­chisee sup­port, your head of­fice skills, in­dus­try knowl­edge and point of dif­fer­ence are valu­able. These all make for saleable of­fer; they de­fine your brand and make it a fran­chise op­por­tu­nity worth in­vest­ing in.

Your re­cruit­ment and fran­chise sales process then be­comes just as crit­i­cal to a suc­cess­ful lead gen­er­a­tion and sales re­sult. Con­sider who is rep­re­sent­ing your fran­chise to the mar­ket and en­sure that they have enough knowl­edge and skills to do so. Re­mem­ber that your ex­ist­ing com­pany store’s per­for­mance and prof­itabil­ity all be­come crit­i­cal to whether the leads you gen­er­ate will move through the steps to join­ing your net­work.

The pos­i­tive to launch­ing a new fran­chise brand is that you can shape your net­work, in­vest in your first fran­chisee’s sat­is­fac­tion and suc­cess, and use this to at­tract even more qual­ity can­di­dates. You can also continue to im­prove your com­pany lo­ca­tions and tighten your sys­tems, so that you have an even more at­trac­tive of­fer for po­ten­tial fran­chise part­ners.

If you are an ex­ist­ing fran­chise, it is time to re­view and re­flect on your sup­port model and fran­chise sys­tems, and in­vest in your fran­chisees’ suc­cess. Af­ter all, your cur­rent pool of fran­chisees will be ad­vo­cates for your brand, and you want them to share pos­i­tive sto­ries in or­der to grow your fran­chise net­work.

Po­ten­tial fran­chisees – now more than ever – will be look­ing to your cur­rent sys­tem for in­sights into their fu­ture suc­cess. If there are skele­tons in your cup­board, like many of the sto­ries we have been hear­ing about from some of Aus­tralia’s big­ger fran­chise sys­tems, they will be exposed and it will send qual­ity ap­pli­cants run­ning. The Fran­chis­ing Code of Con­duct has put sys­tems in place to pro­tect fran­chisees, and the ACCC is en­sur­ing that all the reg­u­la­tions are met and that fran­chisors are ad­her­ing to in­dus­try stan­dards and the law set out by the Code.

Now is the time to in­vest and not to cut cor­ners. En­sure that your fran­chise busi­ness is trans­par­ent and able to show its of­fer in a pos­i­tive way. Put your best foot for­ward and en­sure you have put every­thing pre­pared, thus set­ting your fran­chisees up for suc­cess. Never take your fran­chisees for granted and never for­get that their suc­cess is your suc­cess.

So go out there and get the fran­chisees you de­serve! They are out there, and they are cry­ing out for hon­est, qual­ity fran­chises run by qual­ity peo­ple.

Good luck!

Con­tact James on: 0404 078 782 [email protected]­strat­egy.com www.dc­strat­egy.com

James Young has over 15 years’ ex­pe­ri­ence in the fran­chise in­dus­try. He has re­cruited fran­chisees for over 40 ma­jor fran­chise net­works in Aus­tralia and in­ter­na­tion­ally. James also as­sists fran­chisor clients in recruiting ex­pe­ri­enced op­er­a­tional and head of­fice per­son­nel. He is a li­censed busi­ness bro­ker who as­sists fran­chisors with exit strate­gies and ne­go­ti­a­tions and fran­chisees look­ing to sell their fran­chise busi­ness.

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