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It’s all good and well to find a franchisee to run your amazing business, but they have to be the right franchisee! While you’re probably very eager to open up your next franchise and keep your business going, it’s important to create a strong and capable network of franchisees to help you expand your business. Making poor decisions in terms of franchisee candidates is going to cost you a lot of time and money later on - so start out with great franchisees from the get-go! Read on to find out how to choose the right candidates for your franchise.
A financially qualified candidate is a necessary qualification when it comes to applying to be a franchisee with your brand, however it is not the most important qualification. Too often, franchisors place too much importance on the finances and ignore other qualities that make a great candidate. By solely focusing on a candidate's ability to buy in, you risk choosing a franchisee that actually doesn’t ‘fit’ your brand and can cause you quite a bit of grief. Of course as a business, you need to know that a candidate can afford to buy in, but need to make sure that you aren’t surviving off that franchise fee alone. As a franchisor, you should build a royalty stream, rather than just implement large initial franchise fees. This will not only give you assurance of a steady revenue stream, it will also assure you that the franchisee you have selected is invested in your business. Royalties are just one tactic to provide reassurance that your franchisees are the right choice and that they are heavily invested in your franchise.
An often overlooked factor is a candidate's passion for your business and the industry you operate in. “Why is passion important?” “Shouldn’t we focus on a franchisee’s ability to run the business?” Well a franchisee's capability to invest themselves into your business and have success as a franchisee is directly related to their passion for the brand and the industry. A franchisee that is passionate about your brand is going to be your best advocate. They are effectively representing your brand and if they have no interest in your brand or even what you sell, they’re going to be a pretty poor representation of your brand. Not only that, but they aren’t likely to be willing to work hard to allow the franchise to be successful. Those working with only profits in mind are less likely to find themselves motivated to actually put in the work. In reality, they’re going through the motions, but not really putting in effort. Franchisees who are passionate about your brand are going to want to work hard to create a successful franchise and will take pride in what they do. A passionate franchisee is your best asset!
While having this quality is admirable and definitely not something to be criticised, when it comes to franchisees, this quality can be detrimental. Franchisees should take your brand and run with it, not try and make it something else. Maybe you want your franchisees to add personality and a bit of a twist to make the franchise their own, but reinventing your business is something different altogether. Your business is already awesome, it doesn't need reinventing! Keep an eye out for the entrepreneurial spirit among candidates and steer clear!
You already have specific brand values, so does this potential candidate ‘fit’? That doesn't mean you should discount diversity, it just means to note whether this person values the same things your brand does. Consider also, whether this candidate has the qualities that you might like a franchisee to have. Maybe that's a bubbly and outgoing personality or a to-the-point attitude. Not every franchise candidate is going to tick all the boxes, but have a think about those qualities that make a great franchisee for your brand. A franchisee that aligns well with your brand values is an asset worth having!
Finding the right franchisee is really important and it's not something that can just be boiled down to the funding qualifications. As a franchisor, you need to consider whether a candidate has the passion for both your business and the industry you operate in, whether they can (and will) run with your brand and whether they ‘fit’ with your brand’s values. A franchisee can make or break your franchise, so ensuring you have the right franchisee from the beginning is essential.