How a Franchise Agreement and a Franchise Disclosure Document differ
There are two documents that are of vital importance...
Over the 25 years I have been in franchising I have worked with a variety of brands. I have worked in food, real estate, travel and other industries. Despite the many differences, I have found similarities. One of the commonalities is the qualities shared amongst successful franchisees.
Strong franchisors know the qualities of successful franchisees and will watch and interview for them as they recruit new franchisees into the system. Depending upon the industry, they will look for certain experience and skill sets. It might be sales or management. But these skill sets can be taught. More frequently it is attitudes that make the difference. Franchisors will actively look for these attitudes when selecting their next franchisees.
Below are the top 10 qualities that are most commonly found in successful franchisees. Rate yourself and see how you compare.
1. Ownership, Accountability and Responsibility. Successful franchisees take ownership for their own success. They rely on the franchisor for support and assistance. They will seek input possibly from other franchisees, but know that their success is dependent upon them. If things are not going according to plan they make adjustments to get things back on track, rather than placing blame, making excuses or being in denial.
2. Willingness to follow a system. Successful franchisees are committed to following a system. They recognize that a brand is created through consistency and that there is a need for all franchisees to follow the franchise business model. Some individuals are too entrepreneurial, not willing to adapt but instead want to do their own things. These individuals are best to open an independent business.
3. Customer service focus. Successful business is all about getting and keeping customers. Successful franchisees have a high desire to provide exceptional customer service. This is how you build a long term viable business. It is far easier and more impactful to have existing customers coming back more often, buying more products and services, than trying to get new customers.
4. Leadership. Successful franchisees have the ability to get things done through others. They see employees as a valuable asset rather than an expense. They will communicate to employees what is in it for them. Their employees are treated as individuals, with respect and trust. The successful franchisee Inspire others to a common vision.
5. Optimistic outlook. Business will always have ups and downs. You will be faced with challenges, i.e. employees not showing up for work, running out of inventory, etc. Successful franchisees don’t let these issues take away from their long term positive outlook. They always see the glass half full, not half empty. They respond to the issues knowing that it is simply a small speed bump and not an insurmountable mountain.
6. Energy and stamina. Initially starting a business may require long hours. Successful franchisees recognize that starting business will require a lot of long hours and hard work during the initial start-up phase. They have the energy and stamina to work the long hours and do what is required to start the business.
7. Realistic expectations. It may take 1 to 2 years to build the business to solid profitability. Successful franchisees are not expecting to get rich overnight. They may not get rich at all. Instead, they are going into the business knowing that the business will provide a great income and will allow them to build long term equity.
8. Drive, high attainment. Successful franchisees have a habit of setting goals and working hard to achieve them. Ideally the goals are written. They are fully committed and focus on the achievement of their goals. Despite obstacles and challenges. , the successful franchisee does not give up.
9. A passion for the brand. Successful franchisees are excited about the brand that they have chosen. They are constantly promoting the brand in the community and with friends. They are excited about getting up in the morning and going to work. They strongly believe in the products and services that they offer.
10. Financial ability. A common reason why businesses fail, often within the first year, is because they are undercapitalized. Successful franchisees have the financial investment required to invest in the business initially as well as provide for the working capital needs during the start up phase of the business. The successful franchisee is not borrowing all the funds and having all the profits going towards servicing debt, but instead has anywhere from 30% to 50% unencumbered funds, or cash, to invest.
No person is perfect but if you have the majority of these qualities, you have what it takes to be successful in your own franchise. Most successful business owners will have a variation of these ten qualities and character traits. It is what has made them successful. How do you compare?
Getting into business for oneself is not for everyone. Doing it through a franchise allows you to minimize the risks of getting into business. Once you have identifies your personal strengths, and still desire to proceed you can search for a franchise opportunity which will allow you to capitalize on your strengths.
