Category Archives: The Franchise Market

Will the Banks Step Up Now?

One of the crucial keys to keeping businesses moving and healthy is a trustworthy source of ‘Parent Finance’.

What do I mean by Parent Finance? Well – that’s what I call the ‘back-up-plan-for-when-the-fat-hits-the-fan’ option. Nowadays its hard enough growing up, but trying to afford to buy a house, start a business, grow a family….these things are becoming more and more difficult for each new generation.

Now you could argue that older generations were less materialistic and more realistic about what they could afford and well…credit cards hadn’t been invented. I would definitely agree in part with this – however there is a huge chunk of reality that slaps new generations in the face:

(a) out-of -reach mortgages (home loans),

(b) property prices and

(c) the cost of living being at an all time high.

My worry is that this will adversely affect the sprouting of new businesses and the future entrepreneurs out there. Heck I have a daughter that is 4 months old and my biggest wish is for her to be able to do absolutely anything her heart desires and florish at what she is (will be) good at – what I don’t want is money to stop her being all that she can be.

I have never been one to lend money – but you can see why you need to…when it comes to trying to start and/or grow a business. For franchises – financing is pretty crucial especially for a start-up franchisor. He/she has a lot of work to put in, in order to get his/her model into a healthy franchisable position and be able to support a new growing network of franchisees. What I don’t understand is banks that have dealt with some business owners for years (even in a personal capacity) are not willing to sit down, have a chat mano-e-mano (or womano) and see what is POSSIBLE…as opposed to immediately jumping on to the fence of ‘NO WAY…not possible’.

I dare any bank to revert back to the good old of days of healthy client relationships based on give and take…and most importantly trust. As with disciplining children….parents oddly end up punishing the good kids…because one bad kid messed up. I feel that the ‘loan requirements’ nowadays are a result of years of bureaucracy and once off fraud cases….and have become as stifling as a mole that can’t find away back up to the light.

What are your experiences or thoughts on the subject?

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Strategic Partnership Choices

This is a really crucial subject that many business owners don’t look at hard enough when they are mapping out their business models.

I am a firm believer in businesses keeping their focus on what they are good at delivering, however I also believe that they should be grabbing viable opportunities when they arise.

This means that if there is something that your clients are asking for time and again, and your standard response has been “We don’t do that” – please realise that you are losing out on income every time you say that! (Or worse…pushing clients towards your competitors.)

So, what is the solution?

Forge some solid strategic partnerships and ‘white label’ them. What does that mean? Well, you engage businesses as ‘partners’ for all intents and practical purposes and they deliver what you need them to – but under your name.

What is the catch?

You need to be careful in your strategic partner choices. My top tips in securing long term, sustainable partners are as follows:

1. Interview them as you would a valuable employee
Remember that they will be the ‘face’ of your business – so there is a definite need to ensure that the partner business shares your values and has the same ethical business practises as you do.

2. Get References
Don’t take the prospective partner’s word for it that they are ‘fabulous’ – get some examples of their work and speak to their clients. The proof, as they say, is in the pudding.

3. Don’t jump at the first attractive proposition
I always ‘watch the waters’ for a while and see if the partner business remains consistent in their communication and that their reputation in the connected business circle ‘rings true’. The partnership must be lucrative for both parties – so make sure its attractive for you and the partner. Anything that is profitably unbalanced is fishy!

4. Have a trial period to test the relationship
As with a new employee – make sure you build in a probation or trial period, where you and the partner can work out if this is a partnership that will be lucrative and sustainable for both of you. You will also need the time to work out any ‘kinks’ – because you don’t know how anything will work out practically.


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The Opportunity in Regulation

If there is one thing any British entrepreneur will tell you, it’s how much the government likes to have a ‘hand’ in how they run their businesses. As a non-Brit born entrepreneur operating in England, I do sometimes despair at how much regulation there is and how very little faith the powers that be have in our ability to be adults and run our businesses responsibly. I reckon it’s all about the old adage of “punish the group, instead of just the naughty.”

Unfortunately, until we can all put ourselves forward to be MP’s (and who really wants to?) – we have to grin and bear it. After a lot of thought on the subject and being quite bored from fighting it, I have to say that along with regulation… comes an element of opportunity as well. If you, in your industry or specialism, can find a way to work with the regulation and even find a window of advantageous possibility – you may well surprise yourself with what you find.

What do I mean by this? The one defining thing about regulation is…you have to do it. By businesses having to comply to some form of rule or regulation in order to operate, there may be an opportunity to provide a service or product that helps the business owner do this in a cost effective and painless manner. Most business owners are happy to pay for someone to ‘just sort it’.

Tips on How to Make The Opportunity Yours

1. Ask yourself: What regulations do you know of, that have recently come in (or are about to) and what do businesses have to do or change within their operation to comply? Also – when does the regulation come in (if it hasn’t already) and how much time do business owners have to get themselves sorted.

2. Map out what your strengths are and where can you help? Draft a service package or product outline of what you can do and/or provide and get some feedback from a few business owners to see if it’s something that they would find useful.

3. Research the size of the market and the potential for profit. Do some serious market research to ensure that should you embark on providing this product/service, there is definitely a good reason to do so!

4. Carefully choose the right partners and routes to market that will suit your service/product and maximise the opportunity for your business.

5. Be smart: Automate and outsource how you can provide this product or service! This will help create a ”bolt-on” revenue source that will add value and not drain your current business.

Always remember to apply the smart principles of franchising behind every new element you want to add to your business. Why? Because the basis of franchising is that it doesn’t need you in the model – it runs itself or is easy to teach someone else to do.


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Marketing the Franchise Proposition

This is one of the main elements that need to be planned out along with the main strategic bits when embarking on franchising your business. The actual franchisee model will dictate a little of how the proposition will be marketed and to whom. What do I mean by this? Well…your marketing plan will consist of two parts:

(a) Brand positioning

This is where you are clear about where your position is in relation to the competition, and what the target customer looks like for the physical service or product that is provided as part of the model (i.e. these are the franchisee’s prospective customers). Why do you have to focus on this? Because this is how the brand will be identified as a whole in the market place and is how you will initially attract any interested prospective franchisees.

As a start-up franchisor: your marketing plan should include the following:

  • a pre-phase 1 step of brand pushing (i.e. before you even start to try and recruit franchisees, take a few months to do some real brand awareness about your service/product, the reputation of the brand..and educate your marketplace about your business. I would advise a minimum of 6 months in staggered proportions in various media.)
  • a preliminary step in marketing to the people that already know about your business (so this may be your current business contacts, client base etc)..and let them know that you have created a fantastic business opportunity and are looking for interested parties

(b) Targetted franchisee recruitment

This is integrated into the above  (even for an existing franchisor) although there needs to be more of a focus on what your message is in your recruitment campaign regarding the business opportunity. My biggest advice on this score is to have a staged plan of recruitment advertising and marketing, leading up to an opportunity for any interested enquirers to come and see you either at a Discovery Day or personally. Interviewing takes up a lot of time, and shouldn’t be rushed, so my advice here would be:

  • Carefully profile your perfect franchisee (in terms of  their identifiable skill set, character and ‘drivers’), so you can easily identify them when they are talking to you
  • Create an enquiry process that makes it easy for prospects to get in touch, but also gives you the opportunity to reduce the time wasters and the mystery shoppers
  • Have a fabulous, eye-catching and attention-grabbing prospectus

By perhaps using a few dates to hold Discovery Days, it will give your sales team some clear time goals to get the prospects in by a certain date and you can plan your recruitment enquiry influx better. Discovery Days are opportunities for people to come and hear a presentation from the franchisor about the franchise proposition and what it can offer them. Make the day interesting and perhaps build in a viable FREEBIE…that will be useful for them when they walk away, like a tool that can be used again, even if they don’t go with your opportunity. You will be remembered forever.


Marketing is such a touch and go scenario, because of its subjective nature, but if you are responsive and listen really well to the feedback you receive (or don’t receive), you are already a step ahead. Here are some of my top tips which may help you cope:

1. Don’t be too proud to outsource for help

It is easy enough to outsource the preliminary enquiry processes – but make sure they are professional providers and a great ‘face’ for your business. First contact is very important!

2. Only stick with the advertising routes that work

It is expensive to advertise, so make sure you weigh up the payoffs with the cost of the route you choose. Do not continue to advertise in top broadsheets (national papers) when you don’t actually, physically get any response from them! (When you are big enough and able to…then advertising in these papers are more for brand awareness than recruitment.)

3. Think outside the box to find your prospects

Consider the options of looking at Vetfran (ex-military), disability organisations (as long as the disability isn’t a hinderance to operating the franchise), minority group associations (women, ethnic groups etc) and other kinds of organisations that have a ‘listening’ of individuals who are actively looking for alternatives to employment and want to start their own businesses.

4. Plan how you are going to manage filtering people through your application process

Always plan for best case scenario – so plan that 10 franchisees are going to signup in one month and ensure that your resource framework can handle this. If there is one time in a franchisee’s life you don’t want to mess up – its in inducting and welcoming them into your network. Make sure you have the support and training in place, so that all you need to do is ‘flip a switch’ and your systems swing into play. Smooth running is what you MUST aim for. People who don’t ‘make the cut’ need to be handled expertly and professionally…so that they are left with a great impression of how you deal with people as a business. (You never know – they may refer someone to you!)

5. Enjoy the growth and sharing your business with others

Although recruitment can be hard work, enjoy this time of sharing your business model with others, but also make sure you protect yourself in terms of how much you share at each point in your marketing and recruitment. Your adverts and marketing message in terms of the franchise proposition aimed at prospective franchisees must be ethical and wholesome, but attractive and competitive at the same time. Your enthusiasm, passion, pilot evidence and prospectus will be your main selling tools in the beginning – so use them wisely and don’t over promise (a trap you may fall into).

Multi-Unit Franchise Purchase the Way Forward?

I’m sure those of you who watch the market closely will agree that the days of single purchase franchises seem to becoming a thing of the past.

Franchisors are planning their growth patterns along the lines of recruiting viable franchisees who will be able and capable to own and manage multiple units. Now, this sometimes means, like in the case of Dominoes and Costa Coffee, that the franchisee will own more than one restaurant (sometimes as many as 4 to 5); but with other multi-service franchise groups…the franchisee may own a variety of the brands under the franchisor banner…for example with Service Master: a franchisee may run a Merry Maids (domestic cleaning) operation alongside a Trugreen (lawn care) one.

Now, the only issue I have with this, on an ethical franchising note – is that I would really hope that these individuals are given all the support, training and guidance that they would need to not only manage one unit…but a small growing empire. I have heard of franchisors who will gladly ‘sell’ multi-units, but don’t really have the resources to help the franchisee manage what it all means in practicallity.

Within my planning sessions with prospective franchisors I will always work a ‘career path’ into the franchise model with them. With a keen eye on the phases of a franchisee life cycle…I educate the franchisor on how the franchisee’s interest will evolve over time – so that they can ensure that they retain the franchisee and don’t end up spending more money having to terminate or recruit new franchisees.This includes building in the option for further unit purchases or having different levels of franchise ownership (in terms of staffing, vans, areas etc)..which a franchisee can progress to (after proving capability over time).

My stand has always been to recruit wisely and with care….because you are in essence choosing ‘family’. These franchisees will be with you for the next five to ten years, a relationship that will not be easy to get out of when you find out that you didn’t carry out your due diligence during your application process.

I think multi-unit ownership is great, but it must be undertaken with due caution and consideration – from both the franchisor and franchisee’s perspectives.

Smart Franchisors: Interview with the End in Mind

Having just finished writing an e -book for people looking to invest in a franchise, I found many things were coming up for me on the franchisor front and I definitely thought it warranted a post on it.

Providing advice and guidance to prospective investors is a really interesting one for me, because I can share some stories and insights to people whose toes curl up when they hear about what can happen if you don’t go into an interview with a franchisor with your eyes wide open and your feet bolted firmly on the ground.

So, my top tips for franchisors when they are interviewing prospective franchisees are:

1.  Be Consciously Respectful

The amount of times I hear of boltchy, arrogant franchisors who admit people into their ‘domain’ and ‘grant’ the person the time of day…man, I could write a book just on that! Of course these people are (generally) in the minority….but bad behaviour travels just as fast as bad news. Stop it in its tracks. Do you how much it takes for that person to be sitting in front of you? Be kind enough to acknowledge that its a big step this person is taking, and that it probably took a lot of courage to be sitting in front of you.

2. Be Aware of Franchise ‘Ignorance’

The franchisor is pretty clear about what the franchising model entails and means in practice, but most prospective franchisees haven’t got a clue. Be mindful of this when going through the proposition with the interviewee…or at the very least give some background to the franchise business model to give the person some kind of frame of reference to compare your discussion to. I use the example of a Head Honcho with Indians vs. Cowboys.

Head Honcho with Indians  = Indians are replicas of the main ‘dude’ so to speak (hence:  Honcho)…and although they carry out the ‘work’ as they are directed to do, they don’t create the ‘system’ or way in which they carry out the work (that is engrained into them as being a part of the Honcho’s crowd) [Franchisor with Franchisees]

Cowboys = generally are a gang of individuals finding their way in the world, guns blaring and behavioural antics alter with how long they have been in the gang. So, they have no real ‘quickstart’ to a system they need to actually achieve anything quickly. [Self-employed finding their way on their own.]

3. Clearly Articulate How You Make Your Money

I educate prospective franchisees to ask this question and be clear on how the franchisor makes his profit. Why? Because they really need to work out that the revenue structure works for BOTH sides. A franchisee never wants to find a franchise where it seems ‘cheap’, ‘easy money’ and there’s no real responsibility to the franchisor for growth or performance criteria.  A franchisor needs to be profitably in this for the long term and be able to provide all of the support and resource frameworks promised to the franchisee. Please acknowledge the importance of this when interviewing a prospective franchisee – also…this will nip any conflict in the bud early on. As you will know…in a franchisee lifecycle – you will get to the ‘teenage’ phase where they will start to question your value and how much they pay you!

4. Never Slam the Competition

Please please please! As most best practice business professionals will tell you – this is a sure fire way of undermining your position and making you look like Iddy the Idiot. A more professional take would be to actually provide the interviewee with a list of who the competitors are and invite them to investigate those offerings as well. Perhaps it would also be good to highlight ever so politely the differences between them and yourself. (1) This gives the interviewee a heads up on who else is in the market and (2) Gives you an opportunity to be look helpful but at the same time (3) Highlight where your offering fills the gap.

5. Pack in the Punch

When I advise prospective franchisors at the planning stage to ‘pack in the punch’ in the offering – make sure you REALLY do. Franchising is very competitive and if you haven’t put together something that really takes away all of the aches and pains for a start-up business, this is where you will lose out in signing up more franchisees. Yes its important to have  market share, an edge and a compelling brand…BUT…a prospective business owner is looking for a wholesome package that will help in all aspects of setting up a business. So, how can you put more into your offering to put you ahead of the rest of the crowd? You will notice the difference in the interview: a prospective franchisee will just light up when you work through all the avenues you have covered. Basically…he will have made his decision then and there…and it won’t take that much more to get a YES.

6. Remember that Interviewee’s are Interviewing You too

Yes, there is the major element that the person you are interviewing has to meet your strict entry criteria and profile – but don’t forget the tender aspect of you meeting their standards and expectations. You, as the franchisor, are also being interviewed (however subtle that might be). So, even if you did approve of their application….they need to approve yours to be their franchisor!


All I’m really trying to say I guess is that SMART franchisors recognise the opportunity to really shine and engage a prospective franchisee in the initial interview – but my 2cents worth of wisdom is that you need to be emotionally and professionally intelligent about how you conduct yourself and present the offering in that interview. If it goes badly, you will find that your enquiries start to dwindle (bad news travels fast as I said) and won’t have a second chance to clean up your mess!

So…Interview with the End in Mind. The ‘End’ being bringing on board a franchisee who respects you and has chosen your franchise because of your great offering and professional handling of him during the whole interview process.

Economy Slowing…Franchising Hotting Up

I am awfully happy to report that there are some more positive stories coming out now – although I have to find them in round about ways. It seems that some people are really being creative about how they get through this period, and are looking at how they do business, as well as how they spend their money. Of course there are the few key drivers that will move the more entrepreneurial minded people towards franchising, and those are:

– not wanting to return to corporate employment (the view of ‘job security’ as changed)

– create something for themselves, with the umbrella of support that franchising provides

– having received the redundancy pay-outs,, this helps them to invest in the right franchise opportunity

Banks in the UK still not actively supporting business (especially small business)… in lending responsibly to those that have viable business plans and have shown steady and unwaivering growth over the last couple of years. My message on that score is – ‘Banks…you best be careful’. When the tide turns and business owners can afford to choose…they will choose those banks or personal bankers who listened, supported and guided as much as they could. They won’t choose those that handed them a multi-page loan application form with hoops and boxes to leap and tick just to get the £15000 they needed to keep their business going and growing.

Its scary how the economy is grinding to a halt – but I have every faith that with the combined entrepreneurial conscienciousness out there – the kickstart is coming soon!

Click here for a story of someone in the US who used his redundancy payout to get into business for himself with the Mr Handyman franchise.

Do note that getting into business for yourself is not the easy route – its even harder than you think it is, but there are payoffs in the longrun.

Me as a Handyman

Me as a Handyman