Franchising has become a very common and profitable means of growing a business. It basically involves two parties; a franchisor and a franchisee. The franchisor is the actual owner of a product or service. All the rights and licenses pertaining to that product or service are held by the franchisor.
There are several types of franchise businesses in the market, and a franchisor can prosper only if he is aware of the essentials of the franchising business.
Key to Becoming a Successful Franchisor
A good franchisor does not believe in quantity, but quality. Therefore, he believes in selecting few financially, emotionally and professionally sound franchisees for the business. A smart franchisor not only earns revenue through franchise fees, but also generates income in the form of commissions from suppliers with whom the franchisees do the business.
They not only monitor the process, but also take important decisions from time to time, as franchising business is under constant evolution. They also know the importance of training and supporting the franchisees, and are always ready to help them whenever they are in need.
Other kinds of support like site selection, training, developmental services, and assisting in advertising are also provided to the franchisee so that a trustworthy relationship is built between the franchisor and franchisee.
Although, the business is defined by a contract, a franchisor realizes that his franchisees can help in recruiting reliable franchisees in the future. He also maintains transparency and proper communication so that there is no confusion between the two parties. Successful franchisors believe in settling disputes amicably so that the alliance is not hampered.
The mission and vision of the business is not only shared with the employees, but also with the franchisees so that they consider themselves a part of the parent company and not a separate entity.
Uniformity helps customers to quickly identify and relate to a particular product or service, and this is something that a smart franchisor knows very well. Uniformity also helps in getting clean chits during audits and inspections thereby, increasing the chances of success.
If the plans are such that personnel and finances are insufficient, it is obvious that the expansion plan would fail. A franchisor should therefore have a systematic and detailed expansion plan. It is better if the expansion is restricted to a particular market at a time so that all the available resources can be utilized for it.
The job of a franchise broker is like that of a real estate agent wherein, he brings a franchisee willing to get into a contract with the franchisor and charges brokerage fees for the same. A smart franchisor develops a vast link of franchise brokers who help in the expansion of the business.
For successful franchisors their integrity matters to them the most, and they do not step back from doing what is right for the business and franchisees. They realize that they have selected the franchisees and do not blame them if anything goes wrong.
Now that you know how to become a successful franchisor, pull up your sleeves and climb the ladder of success, if you think you have it in you. All the best!