How to Identify a Great Franchise Management Service
It’s not uncommon for business owners to stumble as they transition to franchisors. There’s a new business model to get used to, which includes selling the concept to franchisees in addition to selling products or services to consumers.
But before even getting to that point, fledgling franchisors must take several steps to fully develop the franchise system, including:
- Acquiring enough capital to franchise the brand
- Developing and documenting systems for training, marketing, support, supply chain and operations that can be duplicated
- Writing the Franchise Disclosure Document
- Establishing a franchise sales department
And after awarding the first franchise agreement, there’s a lot more work to be done before the brand can be royalty self-sufficient and move out of the “emerging” category. It behooves emerging brands to enlist the help of franchise management partners to grow in a healthy and disciplined manner.
But, not all franchise management service firms are equal. You want to work with one that has extensive franchising experience and a track record of success. A great franchise management partner also employs proven business practices.
Experience Pays Dividends
Your franchise management services firm should be business savvy, with experience in several areas of growing a company – raising capital, licensing products, managing reputation and more. However, while business know-how is important, your franchise consulting firm should have experience actually franchising.
The firm’s team should have experience in:
- Replicating systems
- Attracting and communicating with potential franchisees
- Identifying and expanding in target markets
- Building support infrastructure in training, marketing and operations
- Managing both single-unit and multi-unit franchisees
The franchise management team should also be well-versed in marketing, operations, legal, compliance and training. It’s also important to have knowledge of different franchise industries, like food, fitness, retail or home services. Franchise experience is important, however, their level of business ethics is critical.
With more than 30 years of hands-on experience growing and managing successful franchise businesses, Winmark Franchise Partners can help emerging franchisors grow to the next level. Winmark has been through good and bad times as a franchisor, and that experience can save you from major headaches and pitfalls.
Success should be Measured
The success of a franchise management service is reflected in the success of its clients. As an emerging franchisor looking at franchise management services, you should scrutinize:
- Unit-level economics for each franchised location
- How much franchises grew while guided by the franchise management service
- If the franchisors have moved beyond the “emerging” stage
- How long it took to move out of the “emerging” category
- If each signed unit opened successfully
Experience is important, but what a franchise management service does with that experience determines its success. In Winmark Franchise Partners’ 30-plus years of experience, we have signed more than 800 franchise owners representing over 1,200 locations for five brands.
Business Practices for Peace of Mind
A great franchise management firm has your best interest at heart and provides sound guidance even before you take the franchising plunge.
For example, your franchise consultant should first help you decide whether your business is right for franchising. If you decide franchising is indeed the best way to grow your business, the franchise consultant can help develop each part of your franchise system.
But, if you are already franchising your concept and growth has stalled, a good franchise consultant will conduct a detailed audit to point out financial and performance gaps. From there, they will work with you to develop a plan to fix the system and close those gaps.
There are many ways a franchise management service helps your brand grow. Winmark Franchise Partners provides support in additional ways, including:
- Serving on a company’s advisory board
- Helping with mergers and acquisitions
- Working as an operations due diligence partner for private equity firms
If you’re not seeing results from your franchise management service, that should raise a red flag about their business practices. You should get what you pay for. The service should always charge a fair and equitable fee for a quality service that produces results.
Winmark Franchise Partners has the experience, track record and processes to help emerging brands reach their goals. If you are interested in franchise growth, contact us now or call us at (844) 452-4600.