Posts

Franchise My Business with the Right Sales Process

Step 1: Franchise Outreach/Lead Generation

Franchise lead generation and marketing will fill your franchise sales funnel and be the first interaction with a potential franchise buyer.  Potential lead portals for franchise lead generation:

·         www.FranchiseConduit.com

·         www.Franchiseopportunities.com

·         www.Franchisegator.com

·         www.TheFranchiseCourier.com

·         www.FranchiseDirect.com

 

Organic leads can be generated through franchise referral programs, Franchise SEO, Franchise Public Relations and other mediums. 

Franchise Tradeshows can be an effective way to generate leads and meet potential franchise candidates in addition to other marketing channels.

Step 2:  Franchise Contact and First Presentation

Franchise leads should be greeted with an automated response promoting the model, the franchise value proposition and the overall concept so they are enticed to have additional discussions with the franchise team.  Franchise sales calls should be made within 60 minutes of the lead being submitted for best results.  We typically recommend that a text message should be sent as well. We then have additional introduction emails which should be crafted to your brand and franchise model, but ask key questions:

·         Why are you interested in the franchise?

·         What Time Frame would you like to open the Franchise?

·         Qualify the Franchise Candidate.

·         Present the next step in the sales process.

Step 3:  Franchise Presentation Call

During this call, you should explain the sales process and the defined steps in the process before they would execute a franchise agreement.

1.       Introduction and explain the team behind the franchise.

2.       Define the process and qualifications needed to be awarded a franchise.

3.       Ask the buyer to speak openly with you and share their story. 

4.       What is the timeframe for this decision?

5.       Confirm that the franchise process is clear and understood. 

Step 4:  Franchise Buyer Approval / Disclosure

Once the candidate has submitted their completed Franchise Request For Consideration form, it is reviewed and approval is granted to move forward in the process.  We review with candidate what to expect upon receiving the Franchise Disclosure Document.  We recommend sending a hard copy of the FDD sent via FedEx and electronically via DocuSign.  We then like to schedule a call to review the FDD with the candidate and go through the document in detail. Following the candidate being disclosed, validation and communication with existing franchisees is encouraged and recommended.

 

            Disclosure:  Current registered FDD document is sent to candidate.  Unaudited financial statements must be current within 90 days.  In registration states, the revised agreement must be renewed with every registration state every year.  The following are registration states: CA, FL, HI, IL, IN, MD, MI, MN, NY, ND, OR, RI, SD, TX, VI, WA, WI. (https://www.franchisemarketingsystems.com/blog/franchise-state-registrations/)

Step 5:  Franchise Discovery Day

Once a candidate has been disclosed and had the opportunity to thoroughly review the Franchise Disclosure Document, an invitation to attend a Discovery Day is extended.  The Discovery Day is the ultimate franchise sales opportunity, it is where you show off the business, let them see the business in action and get to know everyone involved in the business model.  If the discussions take you there, you can ask for the close at the Discovery Day. 

Step 6:  Follow up for the Close

Constant follow up is given throughout the entire process, the closing process is no different.  Following Discovery Day, most often the candidate has additional questions regarding the information they were provided during their visit.  The final commitment to move forward and become a franchisee is requested and confirmed.

Step 7:  Award Franchise

Now that the decision has been made to become a franchisee, Franchise Agreements and all supporting documents are signed, notarized and submitted to the corporate office along with payment of the initial franchise fee. Training is scheduled and the countdown to Grand Opening begins for the approved franchisee.

 

For more information on How to Franchise Your Business, contact us:

https://www.franchisemarketingsystems.com/contact_franchise_consultants/

 

How Many Leads Does It Take to Close a Franchise Sale?

If you’re a franchisor and you’re looking for ways to branch out and feed your franchise development pipeline, there’s a few things you need to know when it comes to closing a sale. Just how many leads do you think it will take to get to that final closing table? One? Ten? You might be surprised to know that it takes considerably more than that to get to the close of your new franchisee sale. When you start to franchise your business you have to find the highest quality leads to market your franchise to.  This means that you need a significant quantity of leads to close a franchise sale.  In particular when you consider that you will be qualifying the leads as they come in carefully to screen and qualify the franchise buyers.  As a franchisor, you only want the best of the best running your brand and name in other locations.  Finding the right franchisees requires a large volume of candidates to find the ideal buyers.  Here are a few tips and facts to keep in mind and how best to approach selling franchises.

 

How Many Leads to Close a Sale

Most often it takes at least 100-150 different leads to actually close a sale according to broad industry statistics (http://www.franchise.org/) . A lead generally is considered a filled out form, which in today’s world of franchise lead generation portals and internet advertising, a form lead isn’t necessarily the best lead.  The good side is that they are easy to generate and generally pretty cost effective ($35 – $65 per lead).  Generating the lead is only part of the sales process, a good franchise sales system will have a solid development team to work the leads and manage the incoming franchise opportunities.  This means consistent calling, regular communications and constant contact with candidates.  Generally we recommend 5-10 calls in addition to a franchise lead nurturing program to get the most out of every lead that comes in.  You may use sources such as the internet, tradeshows or your public relations department may provide leads. No matter where they are coming from, you need to know that they are good quality leads and they will cost you depending on what avenue you use.  Typically, we recommend that you have a franchise sales person on your team for every 400-500 leads you generate per month.

 

Best Lead Generation Strategies to Sell A Franchise

Part of what makes a good franchise development campaign is the leadership and thought process behind it.  Think about the franchisee as your customer, understand what is driving their decision making and what will get them excited about your franchise offering, create the appropriate messaging and then start the lead generation to get in front of the buyers and find the candidates.  When you’re looking to generate leads for your new franchisees, you want to have solid quality leads coming in. What are the best ways to get those leads? Well, internet marketing is still at the top of the list when generating sales leads. The internet can reach thousands more than you can alone and generally for a lower budget marketing campaign, Internet leads alone are capable of driving plenty of traffic and provide a low cost franchise sales campaign. Franchise Marketing plans should also incorporate some version of social media, third party websites and blogs are still very effective for brand development, establishing credibility and for generating great leads. 

 

Other avenues you can pursue include arenas such as your local franchise tradeshows where you set up a booth and can market to franchise and business buyers who are interested in brands and concepts in a particular market.  Tradeshows are viable strategies for generating leads in target markets and typically have a slightly higher closing rate than internet franchise leads.  Tradeshow leads will generally be a bit more expensive ($75-$150 per lead).  Some franchise brands will also purchase lists of candidates and conduct email marketing campaigns to drive traffic and generate franchise interest. Franchise Public relations are a huge area where you can also put the word out to those who are looking to own a new franchise.   Another great avenue for you to gain leads for new franchise owners is by direct selling and marketing through calling to potential conversion franchises in your market space or finding a category of buyer to focus on outbound calling or mailing.

 

How to move buyers through the sales Process

The key to success when reviewing how many leads you need to close a franchise sale is also considering what you are doing with those leads to get them to a closing.  Ultimately, we always use the Franchise Discovery Day as the target to close the new franchisee.  This is the meeting, final review and franchisee’s opportunity to see the business in person and ultimately where the franchise sale takes place.  We recommend creating franchise sales stages where you can understand key performance indicators and see where the buyer is at any given point.  For example, hold a regular franchise webinar where franchisees are invited to come to these as phase 1 of the franchise sales process.  For Phase 2, you might ask the franchisee to fill out an application form, Phase 3 might be a Franchise Disclosure Document review and Phase 4 could be the Discovery Day.  (Typically our franchise sales processes are seven stages).  Whatever your process is, define it and stick to it so you know whether you are getting a ROI from your franchise marketing efforts.

 

For more information on how many leads does it take to close a franchise sale, contact us:

info@FranchiseMarketingSystems.com

The Chick-Fil-A Franchise Story

Chick-Fil-A Franchise

 

Chick-Fil-A is an extremely successful and consistent franchise system.  The privately held chain did over $2.5 billion in systemwide sales in 2009 from over 1,300 franchised stores in the U.S.

Chick-Fil-A franchise

The founder of Chick-Fil-A, Truett Cathy, 88, credits the company’s success to over 1000 franchisees and over 600 employees who are unusually dedicated in an industry known for grumpy operators and high turnover among hourly workers. The turnover among Chick-fil-A franchise operators is an extremely low 5% a year.  Among Chick-fil-A hourly workers turnover is 60%, compared with 107% for the industry.  Chick-fil-A focuses on hiring and bringing in franchisees who are looking for lifetime commitments to the company.

That’s not the only company mandate. Chick-fil-A’s corporate mission is to “glorify God.”  It is the only national fast-food chain that closes on Sundays which allows franchise operators to go to church and spend time with their families; franchisees who don’t go along with the rule risk having their contracts terminated which is unusual in today’s “bottom line” approach.  Chick-fil-A’s approach is to balance life with work which seems to be working.

truett-cathy-chick-fil-a

Many of the Chick-fil-A franchisees have come from the foster homes run by a nonprofit organization Chick-fil-A funds, the WinShape Foundation.  The upfront franchise fee for a Chick-fil-A is only $5,000. Most franchise systems require net worths in excess of $500k and upfront franchise fees of $35k or more.
The structure of the Chick-fil-A franchise from a business model is unique also.  Chick-fil-A pays for the land, the construction and the equipment, they then rent everything to the franchisee for 15% of the restaurant’s sales plus 50% of the pretax profit remaining.  Operators are discouraged from running more than a few restaurants will typically take home about $100,000 a year on average from a single outlet.

Chick-fil-A Franchise

 Truett Cathy is extremely particular in who he selects as franchise operators.  He wants married workers, he would like them to have attended Christian-based relationship-building retreats and Chick-fil-A will even interview family members of prospective operators.  They would like to learn more about candidates and their relationships at home. “If a man can’t manage his own life, he can’t manage a business,” says Cathy.
How is this legal and why does it work so well for Chick-fil-A?  The structure is based on core beliefs and principles which are consistent throughout the franchise system.  Whether it is legal is open for debate, but the bottom line is that in franchising, the rules are different than in employment law. There is much more freedom in who is selected and why as opposed to hiring an employee where religion and marital status are to be left off the table.