How to Grow a Franchise with Strong Franchisee Validation

The validation process is the moment of truth for both franchisee candidates and franchisors. As part of their due diligence, candidates will speak with a brand’s current and past franchise owners to assess what the franchisor has told them is accurate. The candidates will find out if the franchisees are happy with the franchisor and, ultimately, if the opportunity is a good fit for them. The franchisor can determine how easily the system will grow depending on the number of candidates who sign on after visiting with existing franchisees. If it seems like a slog, franchisors need to examine how to better increase their franchisees’ satisfaction.

Are Your Franchisees Happy?

Franchisors should encourage candidates to speak with current and past franchisees. The transparency of this action will help ease the nerves of candidates. It will also help the franchisor if the candidate determines they are not a good fit as franchisors spend a lot of time and money helping franchisees get up and running.

Woman Talking on Phone at Desk

To get a clear picture of what lies ahead, candidates should speak with 10 to 20 franchisees, ranging from the longest tenured to some who have been in business for only a year. They should also speak with top-earning franchisees and those who have yet to break even.

Emerging franchisors should count on candidates asking their franchisees these questions and more:

  • Did the training adequately prepare you to launch your business?
  • How is the support provided by the franchisor, pre- and post-opening?
  • Does the franchisor respond to your questions and concerns in a timely manner?
  • How many hours a week do you spend working on the business?
  • What does it take to break even and/or become a top producer?
  • What do you know now that you wish you knew then?
  • If you had to do it all over again, would you choose the same business and franchisor?

If franchisors are doing everything right, they can count on their franchisees answering positively. Ultimately, happy franchisees generate franchise system growth.

Growing Satisfaction Among Franchisees

The best strategy a franchisor can take to ensure growth is make sure the current franchisees are happy as well as profitable. Profitability matters most to business owners. But there’s more to generating satisfaction among franchisees than profit, which does not happen right away.

Cafe Employee in Doorway with Now Open Sign

Franchisors need to make sure they have a strong support system that helps move franchisees toward the break-even point and beyond. By providing thorough training, easy and/or simple operations, effective marketing and more, newer franchisees will become comfortable with their decision to invest and older franchisees will be comfortable relying on their franchisor.

Consistent communication is key, too. Through company newsletters, intranet sites, conference calls and meetings, the franchisor can share metrics that allow franchisees to measure how they are performing. Sharing best practices of top performing franchisees can educate the rest of the system and will help others shoot for top-performing status.

Healthy competition and performance incentives go a long way toward generating satisfaction among franchisees. Everyone likes to be recognized for a job well-done, so franchisors should provide annual awards. The focus should not only be on top producers, but also on most improved franchisees and those who exemplify the spirit of the brand best.

The happiness generated among franchisees by the franchisor will be conveyed to franchisee candidates seeking validation. However, franchisors do not have to wait to spread the news about franchisee satisfaction until candidates conduct their due diligence. They can attract entrepreneurs through public relations and content marketing in the forms of press releases and blogs, for example.

The Bottom Line for Franchisors

Happy franchisees are crucial for franchise system growth. Franchisees who are fans of their franchisor will sing their praises and possibly convince candidates to join the system.

Flourist Putting Bouquet Together

A good example of how taking care of current franchisees spurs growth is Popeyes Louisiana Kitchen. The company had a problem with disgruntled franchisees until a new CEO, Cheryl Bachelder, came in and made franchisee satisfaction a top priority in 2007. Not only did the company’s market share increase, but Popeyes experienced significant growth between 2011 and 2016. They began attracting franchisees who owned other fast-food restaurants and the brand opened one-third of its stores in those five years.

With 30 years of franchising experience and more than 800 franchise owners representing 1,200 locations for five brands, Winmark Franchise Partners can help improve your system’s growth through franchisee validation. If you are interested in learning how you can improve your franchise validation, contact us here or at (844) 452-4600.

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