Category Archives: Business modelling

3 Ways to Build Your Business to Franchise It

If there is anything that this recession has taught me as a franchise consultant – its that if people were afraid to grow before, they are damn near petrified to do it during a recession. Its such a pity – although you can understand when part (or two thirds) of the recession is based on the bank’s poor management or utilisation of financial tools. The small entrepreneur doesn’t have the support or resource of funding from a “trustworthy” institution to help spur and encourage his growth.

So, after reading a blog article about the ways to build your business on a budget, I thought that after the year I have had on the consulting front – it wouldn’t hurt to put together my Top 3 Tips on how to build you business towards franchising…so that you can do it in the next 2 years and not wait for the banks to sort themselves out.

TIP 1: PROVE AND DOCUMENT THE MODEL

Everything you are doing now is fantastic, but want I’d like you to think about is actually taking it a step further. Take an extra 30mins to an hour a day to reflect on the system or process that you enacted or initiated in that day – map it out and put it to one side.

At the end of the month – pull out the maps you have done through the month and stick them on your wall so you can stand back and look at them. This is a nifty way of trying to “third” position your business and pretend you are looking purely at the flow of actions. Do they make sense? When did you last update them? What is the most effective way to do something? What obstacles have you overcome?

These elements are the bits that will heighten your value to a prospective franchisee.

TIP 2:  PRICING FOR PROFIT

We all know that when we first start out in business, we don’t actually know how to price our services and proucts. Make a concerted effort to really make sure that your pricing:

  • Includes a true reflection of the time and effort you put in to market and deliver the service/product
  • Covers all costs incurred to put that service or product together (don’t forget delivery and collation where applicable)
  • Includes a good margin for profit (anywhere between 15% and 30%) – don’t forget that this is why you are in business

If you haven’t done a good competitor litmus test on pricing – make sure you take the opportunity to …and compare like for like. Pricing is big hurdle for newbies to business – but having this sorted for a franchisee and having proof that the product/service sells (well) at those prices – that’s a big PLUS.

TIP 3: PUT IT IN A PRETTY DRESS

We all know that it takes a lot of hard work to make a business successful and there are no “real” easy fixes, however…we also know that if we love what we do …the degree of “hard” diminishes. If you are thinking of growing your business and want to consider franchising…make sure you make the proposition attractive enough to get the deserving interest.

I’m not saying lie about what the business entails – I mean make sure that you build in the elements that would make the business look exciting and enticing to join (look at elements of branding, support, tools, alternative avenues for revenue, etc). A pretty dress attracts the interest, but its the person (or business) wearing it that will retain the attention – if that makes sense at all!

So – take those three tips and build your business towards the opportunity of growth (while we wait for the dearly mis-directed banks to get their act together and see that businesses need them to help them grow and pick the economy up!)

If you have any comments. questions or feedback you would like to give about your experiences of trying to grow in this environment – please share them with me below!

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Top Tips: Capturing Your Winning Formula

One of the very first questions I ask my prospective franchisor clients is ‘What is Your Winning Formula?’….and generally I get a blank look in return! That’s ok though, because that is a normal response.

How many of us business owners ever stop to work out what is working in what we are doing every day and what isn’t? The answer: few….but more than you would think. In franchising this is a crucial thinking step that needs to be taken before you can even consider growing using the franchise model. I’d like to give you some help though – its pretty difficult trying to step outside of yourself and work out what your formula is.

TIP 1: Listen to What Your Customers Say

When you get feedback from your customers on you; your customer service; or your product/service what do they actually say? I mean – look at things like:

  • The service you gave when they approached you
  • The service level by which you managed them through from “order” to delivery of the service or product
  • The way in which (system or process)  they were looked after (and communicated with)
  • The actual service or product delivered
  • Follow-up contact

TIP 2: Study What Comes Absolutely Natural to You

This is the hard one, because most people look too hard and can’t actually identify what that looks like. The best thing to do here is to engage your business circle of friends, contacts, staff and possibly even some trusted clients and ask them this question: What Would You Say is My Natural and Unique Ability?

I did this exercise a good few years ago – via email, so that I could record all of the responses – it was fab! Mainly because my circle very nicely highlighted what they perceived to be my strengths as a consultant – which helped me to be better placed to ‘market’ myself.

Purpose of this TIP is to really get to the crux of what makes your business stand out from the competition because of what YOU actually add to the mix.

TIP 3: Describe the ‘System’ By Which You Work

Everyone has a process cycle they have created in their business – what does yours look like? So, from the point of starting to market your product/service to the end result of having sold something to a client and having successfully completed the cycle….jot this down…step-by-step. (And if you have a good client follow-up or retention scheme…then of course add this in.)

TIP 4: Map It Out

Take your observations and notes from TIP 3…and map it out on a big A1 size flipchart. Then, in different colours, take the feedback and notes you have made from TIP 1 and TIP 2…and bulk up the detail around the flow diagram you have drawn of your process.

TIP 5: Stand Back and Observe

Now, after having completed the TIPS and exercise described above…stand back from the flowchart and have a good look at what you see.

  • What stands out clearly for you (as a Unique Selling Point) of your process
  • Are there any bits that could be taken out (in order to streamline the process and create a tighter model)
  • What is missing (if anything)..and if you just added that one thing it would really make the whole model

In closing…

By steadily working through those tips – you should get a pretty good idea of what your winning formula is. It will become clearer to you perhaps even a few weeks after you have done the exercise – because other seeds start to drop in your mind and you go “Ah, hey…that’s another thing that makes my process (formula) work smoother and convert custsomers faster. Let me jot that down…”

This is an exercise that can go on for weeks….so don’t try and do it overnight and set yourself up for disappointment when it doesn’t all become very clear instantly. You will get there – I promise. And when you do – and you have “bottled” that formula…you will be ready to replicate it!

Let me know how you get on…by commenting on this post (ask me questions too if you need to!) and/or going to my Facebook Page which you can find by clicking here.