Grow From Here

A recent UK study showed that nearly twice as many consumers would rather buy from a franchise than a non-franchised business (‘Franchise Awareness & Preferences survey,’ 2006.)

Queried consumers both understood the business model of franchising and preferred using them over non-franchised outlets.   

The problem was that they were often unclear as to which was which. With an estimated 22% increase in customer attainment, the evidence for franchises to increase their visibility became clear.

Contrary to the common misperception of a franchise being a ‘big bad chain’, and media buzz promoting shopping small and local as the noble way to support local economy, these new findings on popular opinion offer a much more positive perspective.  The British Franchise Association (BFA) has acted on this information and developed a brand, ‘Proud to Franchise’ (PTF) which quickly and easily allows consumers to better identify franchises.  BFA member companies (all stringently screened) join at no charge, and are promoted through logo displays and various online as well as print media channels.

How can this data improve your business?

Focus on the advantages that consumers perceive; review your marketing materials and see where they can be improved.

The study shows that consumers want to shop at franchises because they perceive these benefits:

1. Familiar products and services with quality controlled consistency,  high standards of  service levels
2. Support of local economy with the backing of a secure and stable national brand
3. Increased value-for-money due to low purchasing costs
4. Knowledgeable and invested (local!) owners display pride, expertise and commitment
5. A sense of being a valued customer

Remember: 22% more customers are available to you.

Today’s increasingly sophisticated consumers say they see franchises as the best of both worlds:  the dedicated local with the friendly touch; and the broader national network which ensures consistency, support and lower costs.  For business owners, franchises offer a strong supply chain in tough economic times.  Finally, franchise opportunities are offering a safe foothold for people looking to start a business.  All in all, you have many great reasons to be proud to franchise and to find new ways to increase your visibility! 

Have you tried something similar to the BFA’s Proud to Franchise campaign?  If not, is there a simple way you could use these findings to increase sales for your franchises (and therefore interest from prospective franchisees)?

Best Practices, Franchise, Tips

A few days ago, I was talking with Greg Nathan from the Franchise Relationship Institute about his software product that helps franchisors select franchisees who are the most likely to succeed.

In brief, the Franchise Relationship Institute does this by benchmarking characteristics & traits of past successful franchisees and then providing a system that compares new applicants with those traits and characteristics.

Greg is a trained psychologist and works strong in the scientific tradition; hypothesize, measure, analyze and then compare results with hypotheses.  One of his current projects is the validation of the exact extent to which is product is successful in predicting new franchisee success and, not surprisingly, his results will be fact based & very precise.

Listening to Greg talk about the validation project, I was struck again by how vital these feedback loops are to franchise growth.

Successful franchises implement the best programs and systems they can come up with, but then they measure, analyze and adjust based on the numbers and results (rather than what they ‘think’ is happening).  And the faster they can complete this cycle (and then start it up again), the more likely they are to be successful in the long term.

From 1-800-GOT-JUNK?’s Net Promoter measurement tool to calculation tools for attrition rates to sales performance indicators, business growth is fueled by knowing exactly what is actually happen so the best actions can be taken.  One of our customers ties client satisfaction records into payroll bonuses for their employees, which is a great motivator to get everyone in the company on board in trying their hardest to keep the clients happy – you can imagine what that has done for their referral and return customer rates.

What are your best scientific tools to create feedback loops and do more of what is working & change what isn’t?

Best Practices, Business Growth, Franchise

I hear the word ’systems’ and I get excited.  I see possibilities to set things up that make life easier for people & that allow them to focus on what they need to focus on without trying to remember the little details.  I think about setting people free to do what they do best (our company vision).  I think about how it’s the little daily stuff we do that can really change our mindset.

I know that not everyone shares my delight when they hear systems.  Some people think about technology, others think ‘what a hassle’, others just glaze over.  One of the things I enjoy about working with franchisors is that they tend to share my joy in systems.

Out of curiosity, I recently went to Wikipedia to look up the definition of a system:  “a set of interacting or interdependent entities forming an integrated whole.  Systems have structure, behaviour and interconnectivity.”  It almost sounds like poetry to me.  Structure, defined behaviour, and interconnectivity – what better way to grow towards a goal and make sure that each of the pieces is taken into consideration.

However, lyricism aside, good systems are critical to a franchisor.  They increase efficiencies, allow the franchisor to manage the brand effectively, improve communications, and help to increase franchisee satisfaction which then increases your credibility in the marketplace, and the value of your franchise.

Systems include the software used to manage operations, as well as the various forms, checklists, operational manuals, policies and procedures and franchise wide processes.  Systems are also the set of rules that govern behaviour and structure.  The design of effective systems is an entire science in itself (systems theory) which ties into operational behaviour and strategic planning, as well as change management processes.

During periods of growth, the strength of the franchise systems becomes even more important as new people are being brought in at an increased rate and the time available for each task decreases.  Often small gaps in systems become much more expensive or unmanageable during periods of franchise growth.

Franchise systems can include:

• Policies
• Procedures
• Departments
• Corporate (head office)
• Economic
• Cultural (relational)
• Production
• Distribution
• Communication
• Information Distribution
• Sales
• Marketing
• etc, etc, etc

 Developing a system can be challenging as it requires a degree of abstraction and a strong understanding of how all the pieces tie together and how these relate to the business strategy.

Just today I was meeting with a franchisor who had been struck by a very critical system that was suddenly discovered to have been missing from the franchisees’ operations.  “I had it when we ran our first office, but I was absolutely shocked to discover that they didn’t have it.”  Systems that depend on people remembering or doing the right thing require constant energy & attention to maintain.  This is an ongoing struggle and it is easy for systems to fall away over time.  But automating a system not only means the people can put their attention elsewhere (hopefully into growing the value of the franchise) – it also means that the system will be maintained automatically and flagged if it disappears.  What a great way to grow your business!

Best Practices, Business Growth, Franchise

This is a Guest post from Paul Segreto – Franchisessentials, originally posted at http://franchisessentials.wordpress.com/2009/06/22/controlling-brand-trademark-within-social-media-what-to-do-if-franchisees-got-there-first/

I was recently asked to share my point of view on how a franchise brand can — or even should — wrest control of their brand on social media destinations when franchise holders have been early entrants.

Here are my initial thoughts:

As is typical in most franchise agreements, there’s most likely a clause regarding use of the brand name and trademark. It may need some interpretation to Web 2.0 usage, but there should be no problem applying the language in this regard. Also, online branding falls into marketing, and ultimately, advertising. I’m certain franchise agreements provide typical clauses that prohibit franchisees from utilizing non-authorized ads, etc.

All that being said, it’s always best to convince rather than demand. If the organization is large, it may be more effective to work through advertising cooperatives and franchisee advisory councils in pushing anything regarding social media. One strategy could see the franchisor contributing financially to a social media strategy. (Much cheaper than legal expense to enforce clauses in franchise agreement; not to mention “expense” of diminished morale) As incentive to initiate the same, franchisees would need to voluntarily relinquish their online identities so the parent company may establish one facebook page, one twitter id and one website.

I would recommend developing a template for franchisees to use that would piggyback off the national identity. For example, if corporate identity is Zippy Lube, the franchisee could use Zippy Lube NY or Zippy Lube NY 101 or Zippy Lube Jamaica NY and so on. Each franchisee could have their own web page linked to company website. It’s important to maintain uniformity and a sense of organization when attached to company brand or when linked together.

Please share your thoughts below. Thank you.

Best Practices, Communication, Franchise

For those who enjoy reading the franchisor spotlights, have a look at Franchisor Spotlight: Judy Brooks from Blow Dry Bar – Business Wisdom on The Next Women – a business magazine for female internet heroes. 

It’s an interview I did with Judy Brooks from the Blow Dry Bar, talking about how she has grown Blo and her personal learnings along the way as well as her advice for people considering franchising.

A short excerpt:

Growing her company has come from growing the brand and building a strong community, where customers know that they have something in common with the person sitting next to them, whether they ever speak together or not.  Her brand is built down to the smallest detail; calling new staff ‘hair cadets’, fit out details for the premises, playing on the name ‘Blo’ and teaching new staff to honour the fact that customers chose to spend their money with Blo.  Her staff tend to be young and very plugged in – Blo is active online with Facebook, Twitter, YouTube and online bookings.  Read More

The Next Women is also a great place to find articles about women in business and women involved with interesting technology – both start-ups and established companies.

Best Practices, Business Growth, Franchise, Franchisor Spotlight

Enterprising Moms Network.com

They say that necessity is the mother of invention, and in the case of Kelley Scarsbrook that age old expression holds doubly true. I’ve recently had the pleasure of working with Kelley who developed her own franchise, the Enterprising Moms Network. The Enterprising Moms Network offers a place for mothers who are also entrepreneurs to come together and talk about their questions, issues and challenges and be reminded that it is possible to be both a good mom and a good entrepreneur. Kelley Scarsbrook, the founder, is a columnist, entrepreneur, blogger & a mom.

I talked with Kelley about how she got going, her franchise experience, and some of the factors in her success.

Katryn: When did you start Enterprising Moms?

Kelley: I started in Oct 2007.

Katryn: What prompted you to start your own franchise?

Kelley: Back when I left the work force full-time & became a stay-at-home mother, there were no job share or part-time opportunites for me. I started the Mom At Home blog and received lots of emails asking how I got the blog going and ran a business as a stay-at-home mother. I discovered there was nothing out there to support mothers who also want to run businesses. I knew having a secondary income (which almost every family today needs) was important for many women. There are a lot of women who are smart & intelligent but don’t see the options available to them. They have business ideas, but no network to help them get to the next level.

I started small workshops on how to have home-based business for women. It started with really small workshops & seminars, with ten women in a room. Eventually those workshops evolved and grew. I then hosted a luncheon with Sandra Wilson (she had just sold Robeez). Everyone wanted to hear how she did it, how she built her business & eventually sold it for many millions.

The luncheons evolved into events to celebrate women who have done it – made a viable business for themselves. The first event was about celebrating moms in business. It was not a tradeshow, but an educational opportunity. I saw a need for ongoing support for Moms in business.

Katryn: How did you get into franchising?

Kelley: I knew that other women needed/wanted this. I initially I took on the expansion myself, opening in Richmond, & the North Shore, then thought it was ridiculous to think that I can be everywhere. It was supposed to be a side thing but it was taking all my time. I asked members about who might want to run their own chapter. From there, franchising was an opportunity to get it out to other communities.

Katryn: What are/were your franchise development challenges?

Kelley: There were all the details involved with setting it up, the things I never would have thought about. I had to create the manual & the book – writing out the training manual – putting all my brain into it – how I run meetings, what my thought process is & putting that all into words so someone else could pick the book up, read it and run with it. The hardest part of the work is getting people to understand. One of biggest stereotypes to get over was that people assumed the Enterprising Moms Network was about mom topics only. The second obstacle is the type of mom people picture – eg. moms knitting at home. We are business women who happen to be mothers. We have all different levels of successes, and people are always surprised by the profiles of our members. People tend to assume franchising is a hands-off business, but if anything, it’s more time consuming because you have to train & oversee the business. For anyone considering franchising, definitely speak to people in that world to get a full grasp of what is involved.

Katryn: What has been the most exciting part for you?

Kelley: Seeing it catch on. Seeing people understand what it’s about and who are as passionate about it as I am. It was great to connect with other women who “get it”. Building the Enterprising Moms Network has been a bit llike a wheel – you push and push to get it to turn, then it eventually begins to turn on its own and gathers momentum.

Katryn: What were your best resources?

Kelley: Small Business BC (http://www.smallbusinessBC.ca) is a huge, tremendous resource. They have a lot of great programs.
Talk with franchise lawyers or consultants and get some insight first before you take the plunge. Get information & learn about what it means to be a franchisor and the amount of work involved.

Connecting with Kelley Scarsbrook

The Stay At Home Mother is where it all started, and I continue to post information and stay in touch with people there. I am new to Twitter, and am just learning all the lingo and educating myself slowly on how Twitter works. I can also be contacted directly through the Enterprising Moms Network website.

Our next event is the 2009 Business Conference “Get the Word Out!”, Saturday, June 13th, 2009 – 11:00 – 5:00pm. The Conference is an inspirational Event that supports and educates mom entrepreneurs.

Business Growth, Franchise, Franchisor Spotlight

Online Coupons Bringing In New Customers

CBC had an interesting interview recently related to the recent increases in online coupon usage.  They’re in huge demand these days and websites like Red Hot Deals are doing a booming business.  Online coupons can be a great way to attract customers and bring new people in to your location.   People are looking for ways to save money these days, and many are open to trying new suppliers/companies if they can get lower prices.  Coupons can be a great way to entice new customers, and the cost can be extremely low (close to non-existant) if you use online coupons.

Using the internet to distribute online coupons for some retailers has led to a reduction in catalouge production/distribution, saving both the consumer & the supplier money, not to mention lowering environmental impact by reducing paper waste.

Statistics on Online Coupon Usage:

Many retail franchises have traditionally used coupons to bring in new clients, and according to a site called Prospectiv, “Tough times are seeing more people using coupons – 72% of consumers are using more coupons than they did six months ago and three quarters say the state of the economy is the reason for doing so”.  This is strong evidence that using online coupons to promote your product(s) or service(s) is a sound marketing strategy.  When times change and new trends on consumer spending practices surface, they often become the norm for the long term rather just surfacing as a “fad”.

Prospectiv also quotes the following survey stats from polling 1,386 consumers, (August 2008): 

• 80% said they would be very likely or likely to increase their use of coupons if they could be tailored to their interests and delivered online.

• 87% of shoppers said they would be more likely to shop at a retailer that offered coupons.

• And the good news for newspapers: 47% found print and online coupons equally convenient, while just 9% reported online coupons were most convenient.

An article on how to market your coupons can be found at TamingTheBeast.net, where ideas such as; raising standard prices; offering a coupon sign up registry on your site; submitting your coupons to online coupon sites & setting up an affiliate program are discussed.

Creating Your Own Online & Print Coupons:

Other options are to create your own coupon(s) using websites such as MerchantCircle.com (for a fee, their service is to assist you with online advertising), or CouponsReady.com  (design your own coupon for your business website, or print distribution).  Each charges a fee for their service, but make the process of online coupon creation a relatively simple process.  Even better, you can set coupons up for free using Google Coupons.

Get set up with Coupons in 10 minutes or Less With Google:

If you’re not already set up on Google Maps, do that first (5 minutes).  Then go to www.google.com/local/add to create an online coupon for your company.

Google Coupons

Best Practices, Business Growth, Communication, Franchise, Technology, Tips advertising, clients, consumers, creating, Design, distribute, economy, franchises, Google Coupons, Google Maps, ideas, marketing, new, offiliate, online coupons, polling, prices, print, product, promote, retailers, service, statistics, strategy, submitting, trends, usage

So You Want To Franchise Your Business by Harold Kestenbaum and Adina M Genn, 2008

This book  is jam-packed with ideas, suggestions, reminders and information.  It is invaluable for anyone who is thinking about franchising their business.  As a sidenote, I have been interviewing a number of franchisors about their experiences recently, and the most common advice they have for someone thinking about franchising is ‘know what you’re getting in to’ or ‘do your homework about franchising’ or some variant thereon, so this book is a great resource to help you do just that.

So You Want to Franchise Your Business contains four main sections, a useful add-on; guidelines for an operations manual, and lots of good stories – both success stories from franchisors and also warnings from franchisors who got some thing wrong.  The four sections are

1. Why Franchise?
2. Moving Forward (information about advisors, operations and so on)
3. Rolling It Out
4. Keeping it Going

I found Part 1 to be the most valuable.  As I kept reading, I realized I was mentally accumulating a huge to-do list, and it started to feel a bit overwhelming.  This is not a book to try and read in one sitting.  But do read it.

This is clearly written by people who have been through the wars (or, if they haven’t, have spent a lot of time with people who’ve been there!).  I was struck by the phrase ‘you get what you pay for’ – one franchisor I spoke with a couple of days ago was telling me what a disaster one particular attempt to do things with few resources had been for her in her early days.  There is also a good exploration of what makes a succesful operations manual (including a sample table of contents) and a whole chapter on exit strategies.  The exploration of what makes a suitable franchisee is also a nice combination of theory (fit, skills, attitude, funding) and practical (review committee, discovery day, earnings claims, etc).

Technology – Integrated Throughout

I have read a lot of books about franchising, and since I run a company that uses technology to help build businesses, I am always curious whether technology is even mentioned.  Often not.  With So You Want To Franchise Your Business, I was intrigued to find ways to benefit from technology running through the various sections:

• Chapter 6 talked about website and marketing tools, including how to provide branded sites to franchisees
• Chapter 8 talked about training tools and how beneficial automated or online training programs can be
• Chapter 9 was all about the website, including how it can support and strengthen branding, sales, quality assurance and lead generation
• Chapter 10 talked about advertising, building buzz online, internet marketing, public relations and electronic coupons
• Chapter 11 talked about online support; including internet training, the convenience of web access, the advantages of a strong audit trail, the benefits of communications tools and how to advance your branding.

This type of integration of technology into core business strategy can be a huge competitive advantage for franchises that see the value and implement it.  One franchisor said to me that technology had been her source of greatest expense & irritation, but had also provided opportunities for revenue and company growth that she would never have had otherwise.  So thank you to the two authors for including the technology thread in their exploration of how best to franchise your business.  And guess what?  You can find Adina Genn online via twitter at http://twitter.com/AdinaGenn (no real surprise there, right?).

Words of Wisdom/Quotes:

“For starters, not every business is franchisable.” (p. 10)

“Most franchisors agree that moving into the business of selling franchises is a tough transition….  So the more you know about the difficulties, the better equiped you may be at overcoming the challenges ahead.” (p. 21)

“If you have franchisees but do not have the appropriate infrastructure to handle them, it can lead to disaster.” (p. 34)

Past Book Reviews

Outliers by Malcom Gladwell

The Franchise E-Factor by Greg Nathan

What No One Ever Tells You About Franchising by Jan Norman

Book Review, Franchise, Technology

Martha Matilda Harper and the Harper Method – 1888

Martha Matilda Harper was born in Ontario.  She emigrated to New York where, in 1888, she founded the first retail franchise (also called a business format franchise).  She first established one salon and built up its clientele and reputation, then expanded to Buffalo, across New York, to Detroit, Michigan and then to Chicago in time for the World Fair in 1893.   She eventually developed a network of 500 salons across America, Europe, Central America and Asia.  The first shop owners were all poor or working class women.  Harper created the Harper Method and training centres and created a formula for business success that considered location, product lines and services, marketing and the customer experience.  Nothing was left to chance, so that customers got a predictable experience in any Harper salon around the world.  As her biographer, Jane Plitt (author of Martha Matilda Harper and the American Dream) says, ‘She created a team of loyal, ambitious women who followered her precept and business practices as if they were scriptures, and whome she and customers worldwide trusted to carry on the Harper tradition withconsistency and finesse”.

Her ‘Secret Sauce’

The three things that distinguished Martha Matilda Harper and made her frachise operations a huge success are still key to franchises and their business success today.

1. Creative and distinctive Marketing
   When she first began, Martha Matilda Harper used creative advertising and marketing techniques, including offering her salon as a reception room for the next-door piano teacher (one way to get customers in the door!), setting up child care rooms in her salons to build a future generation of customers, and getting the patronage of high profile women like Mrs. Coolidge and Susan B Anthony.
2. Customer Experience
   Martha Matilda Harper focused on making the experience of being in her salons a delight for her customers.  She developed the first reclining shampoo chair (so customers would not get the soap in their eyes), charmed everyone who entered, and, through her training programs, ensured that new associates would not graduate from her training programs until they could make the customer smile.
3. Consistency and Training
   Martha Matilda Harper set up training schools across Canada and the United States to ensure that the quality and training were consistent.  She closely monitored the quality and practices of the franchise locations and sent regular newletters to her many franchisees.

Historical Considerations

As I was researching the story of Martha Matilda Harper, and the first franchise, I came across a number of sites that referred to Albert Singer, founder of the Singer Sewing Machine Company, as the founder of the first franchise system.  The key difference seems to be that Singer’s products were sold by salaried employees, rather than by franchisees, as in Martha Matilda Harper’s case.  She installed working-class women like herself in salons exactly like hers, trained them, inspected them, and shared the benefits of her marketing and advertising campagains with them.  They owned the salons so long as they bought Harper and followed Martha’s rules and the Harper Method.

Other Resources:

• http://www.winningthevote.org/MMHarper.html
• http://www.greatwomen.org/women.php?action=viewone&id=203
• http://www.marthamatildaharper.org/

Business Growth, Focus, Franchise, Franchisor Spotlight

Recession – Where is the Opportunity?

There are many blogs and articles online these days about a recession providing both danger and opportunity.   This has almost become a bit of a cliche.  For business owners in the midst of it, the danger is clear.  But the question many people are asking is where is the opportunity. 

Is the opportunity in the future when many competitors may have gone out of business and my company will still be around?  Is it in the fact that I have to focus on my company’s core values RIGHT NOW if I want it to survive this period?  Is it the fact that I need to get my staff to pull together & need to focus on customer satisfaction to continue to grow during these times?

All of these are possible opportunities, but somehow none of them are terribly exciting.  They’re making the best of bad times, but they don’t get many of the business owners I talk with excited. 

Exciting Opportunities

Three things have come up that do get business and franchise owners excited:

1. The chance to see very cleary where the leaks are in a business – and plug them
2. The opportunity to get new business with bigger customers
3. The opportunity to build exciting new partnerships and strategic alliances

Where are the Leaks?

Recently I got a nail in the tire of my car.  When I went to the mechanic, he pulled out the nail and plugged the hole, then covered the tire in soap to see whether air was still leaking or the patch had been succesful (apparently soap shows up the air coming out of the hole if the leak is not completely plugged).

In the same way, right now, businesses need to be operating at maximum efficiency, and any leaks can easily be seen – the recession is acting as soap on the tire (inelegant image!).  When money was flowing easily, it was not always obvious which expenditures were resulting in increased cash, which jobs were profitable, which customers were happy – there was so much to do and business was growing.

Now, as the outside world may be slowing down (depending on your sector of the economy), it is worthwhile to take the time to look for leaks.

• Are your systems efficient?
• Where is time getting lost?  How could productivity be improved?
• Is your pipeline moving smoothly?
• What are barriers to customer satisfaction/referrals?

Multiple Leaks

One of our clients recently asked us to review their processes.  They had field staff who were writing reports while on site.  Then those reports came in to the office and were typed into an invoicing system.  The invoices were printed off and filed by due date so they could be checked for payment.  If follow up work needed to be done, that was typed into another system and printed off for re-scheduling when the follow up date came around.  Then once payment was received, the information was typed into the actual accounting system (as opposed to the invoicing system).  Each order was typed in at least 3 times, and manually retrieved to verify payment and follow-up scheduling.  Each step in the process had a ‘leak’ in terms of time, efficiency, cost and frustration for the staff who knew that this was a ‘crazy way to be doing things’.   Integrating all those systems (so that the information was typed in once and flowed through to the other systems and automatic reminders were set up so nothing got missed) had a cost, but the payback period was extremely short (less than 6 months) because of the enormous cost savings in staff time – never mind the boost to morale!

10 Minute Exercise:

Sit down for a moment and think about your company.  Where do you do things in a ‘crazy’ way?  What do your staff complain about?  Where are the areas that errors crop in?  (this is a great indicator of a ‘leak’ waiting to happen).  Where does stuff slip repeatedly?  Where are you spending money that doesn’t seem to be paying off in revenue.  Pick one area and start ‘looking for leaks’.  Then let us all know what you found.

Business Growth, Franchise