Back in 1988 when I began Dynamic Performance Systems, I would continuously run into franchisors who would accept anyone and everyone into their system, whether the candidate had what it takes to be a franchisee or not. As long as the financials were sound, the words spoken to the candidate were “Welcome to the __(insert company name)__ family!”
Although the following article talks about churn of clients, it's equally relevant to franchisee selection. Just change the word "client" to "franchisee" and you'll see what I mean.
New business is sexy. The thrill of the chase and the resulting win is exciting. The brand new money from a brand new client is worth reporting. The challenges you have executing are all-hands-on-deck affairs that are worth solving.
She was found in the morning when city pound employees came to start their day. She had been tied to the post out in the cold overnight; her eyes swelled shut from infection. When a dog rescue was notified that a beautiful Golden Retriever was on death row, they immediately came to pick her up.
Have you ever wondered how a franchise candidate that seemed so promising during the selection process turned into such a nightmare? You ask yourself time and time again "How could this franchisee slip past our screening process? They had all the answers. They seemed to know what it would take to be successful."
We're all looking for that "magic bullet" that will tell us which franchise applicants would be the perfect fit right at the beginning of the sales process. Unfortunately, there isn't one. However, there are some easy-to-implement methods you can add to your franchisee selection process that can take you a step closer.
Formalizing the franchisee selection process helps you treat all franchise candidates equally. It's much easier to prove your case that no discrimination exists when you can prove that you treat all franchise candidates the same. You examine each of them with the same questions using the same selection tools for everyone.
Do your franchisees and managers think of themselves of leaders? Not business people. Not franchisees. Not managers. But true leaders? Great leaders? Perhaps its time they should. Great leaders make great franchisees.
Let's try an experiment. Pick your 10 best franchisees. Describe their personalities. Are they all the same? Or are they all different? If you're like most franchisors, you'll say that they are all different.
Now, look at your corporate culture. Is it the same as other franchisors you know? Of course not.
Everyone knows that it really pays off to explore if a franchise candidate is suited to your business. The question is: "Does it pay to spend as much time investigating the partners of a franchise candidate?" Married partners..... so-called "silent" partners.... working partners, you get the idea.
Haven't we learned yet that not weeding out bad franchisees can put the entire franchise system at risk?
Questions? Contact me.
Fred Berni, CEO Dynamic Performance Systems Inc. The Performance Predictors Email: fred(at)theperformancepredictors.com Tel: 800-719-9993 Overseas: +1-416-201-0202 LinkedIn: https://ca.linkedin.com/in/theperformancepredictors Twitter: Dynamic_Fred Skype: DynamicFred