Emerging Franchisors: Keys for Growth (Part III)
Emerging Franchisors: Keys for Growth (Part III)
In Emerging Franchisors: Keys for Growth (Part II), we explored the importance of proof of concept and franchisee validation. In this article, we will discuss how franchisors create sustainable, healthy growth by supporting new locations.
Aim for Healthy Growth
Growth through franchising is a low-investment way for companies to expand their reach and increase their returns. However, growth that is unhealthy or unsustainable will harm your company more than help it.
If your signed franchise agreements are not turning into successful locations, that’s a sign of unhealthy growth. These deals not only drain time and resources, they hurt your brand as a franchisor. “Signed but not opened” agreements do little to attract new franchisees – these candidates want to see a system that efficiently gets new locations off the ground and supports unit-level profitability.
To position your brand for steady, consistent growth through franchising, consider these strategies:
- Build a Strong Support System
A strong franchisee support system is the most effective tool to create success at the unit level. The best support systems guide franchisees through each step of the process, from site selection to grand opening and beyond.
For first-time franchisees, the site selection process can be intimidating. But the franchisor’s connections and resources can ease this stress. Many franchisors partner with real estate brokers in target territories to glean insight into the local market. Others invest in site selection technology that analyzes demographics, psychographics and traffic flow in a given area. It’s especially important for franchisors to help new owners evaluate their budgets and plan long term, since high rent drives up fixed costs and decreases profitability.
Comprehensive training also helps new locations thrive. A quality training program not only prepares franchisees and their staff for opening, it offers ongoing instruction that builds skills and engagement. Make sure you keep your training materials updated as you incorporate new systems, processes and best practices. With a robust training program, franchisors boost productivity and ensure a consistent customer experience across locations.
The combination of an established brand, proven model and strong support system gives franchisees all the resources they need to run their businesses successfully from day one.
- Hit the Ground Running
When new franchisees see a clear path to their grand openings, they are more likely to cross the finish line. The first weeks in business can be overwhelming, but they’re critical for generating brand recognition and establishing a customer base. Make sure your franchisees know you’ve got their backs.
The most effectual path to a successful grand opening is intense local marketing. Beyond paid advertisements, franchisors should help new owners leverage both owned channels and earned channels to get the word out about store openings.
Owned channels – like blogs and social media – are perfect ways to reach consumers at no cost. Both franchisors and individual owners can use owned channels to generate buzz leading up to grand openings. Create content that is fun, eye-catching and informative, and share it on both corporate pages and local pages. This content may focus on special deals, events or franchisee success stories.
Earned channels – like news coverage and influencer marketing – present your brand directly to consumers from a trusted third-party source. In order to leverage earned channels, you must present a newsworthy story about your business to the right journalist or influencer at the right time in the right format. Understandably, that can be a challenge for franchisors and franchisees alike. Many franchisors hire a public relations firm to secure media coverage locally and nationally. This ensures that new franchise locations don’t fly under the radar, making the most of franchisees’ hard work.
If you’re not sure how best to allocate your marketing budget, use metrics to track returns. Choose a few key metrics that are appropriate for your business, such as sales volume or lead conversions, and see how they change when you invest in different marketing channels. If a particular channel yields better results, shift your budget to prioritize that channel.
Keys to Growth for Emerging Franchisors
Success at the unit level is the foundation of a healthy franchise system. It drives franchise recruitment and makes for engaged owners. As you navigate initial financial challenges, perfect your business model and plan for sustainable growth, you’ll get a better sense of how to support your franchise partners and build an inspiring brand.
To create the infrastructure for healthy franchise growth, turn to Winmark Franchise Partners. With 30 years of franchising experience and more than 800 franchise owners representing more than 1,200 locations for five brands, Winmark Franchise Partners can help grow your brand through sound strategy and expert franchising advice.
For more information, contact us here or at (844) 452-4600.