During a Regional Business Advisor role that I was fulfilling during 2016 in the Hawke’s Bay region I had a few clients who were becoming interested in enlarging their bricks and mortar footprint and brand representation by franchising their business model. After explaining some of the finer points of operating a franchise these people started to realise that to go from a single business unit to operating (or at least overseeing the operation of) multiple business units is easier said than done.
Why ?
Mainly because new-to-franchise business owners don’t comprehend the significant step up it takes to move ones’ mindset from being an owner-operator of a single business unit to instead managing/ governing multiple business units…and some even try to juggle continuing to operate their own business unit alongside managing/ governing those business units that become owned/ operated by franchisees. The result is that something will necessarily need to be let go of…it is simply not possible for particularly one person to juggle operating their own business unit alongside being the driving force of a developing franchise.
Secondly, while a business owner may be competent at operating their own business, particularly the more introverted business owners find it difficult to “come out of their shell” to overtly manage the interests of the business units that become owned/ operated by others as franchisees. The single most important attribute that a Franchisor/ senior manager of a franchise needs to have in their skill set is a natural and well developed talent for communicating.
If you are contemplating becoming a Franchisor and you are not naturally predisposed to sharing information/ knowledge/ insights then I suggest that you should think long and hard about setting-up a franchise. In my experience a franchise operation will either be successful or dysfunctional in direct reflection of the extent to which the Franchisor communicates with all relevant stakeholders – with Franchisees in particular.
By all means have the ambition and passion to establish a franchise operation, yet understand with clarity what it takes to build and shape a successful franchise operation before you sign-off on the legal documents which will underpin your franchise. Legal documents do not create successful franchises…rather, highly competent leaders communicating openly, honestly and frequently with their internal stakeholders (Franchisees in particular) are responsible for most of the success enjoyed by high performing franchise operations.