How To Manage A Franchise Business

27 Oct

The advantage of buying a franchise over starting up a totally new business is that it provides the opportunity to jump straight into a proven business model. Buying a franchise, however isn’t an ironclad guarantee that the franchise will work.

Franchisees must be effective at managing and working their business. If you’re thinking of starting a franchise, or have just bought a franchise and you are starting a new career as a franchise owner, here are the steps to manage your franchise towards guaranteed success.

1. Sell With Passion. Know Your Product Inside Out

Enthusiasm is infectious. Business owners who love the product or service that they’re promoting will find that projecting passion when dealing with customers inevitably leads to more conversions and higher retention rates. Combine this with a comprehensive understanding of your franchise product or service, with a willingness to listen and you have a recipe for success that rewards you with customer satisfaction.

2. Be Prepared To Invest. Hire A Team. Aim For Growth

One of the main attractions for people buying a service-based franchise is the opportunity of being able to work for themselves. While this may be ideal for an initial period of time, being content with a small team may lead to problems further down the line.

One person, no matter how skilled they are, can only do so much work within a working day. Not hiring to service demand stunts the future growth of a franchise and in some instances, the franchisor will also have something to say about this.

Having capital to invest in the business, to hire competent employees and build a team, is a proven way to build a franchise. Going down this route may lead to higher initial outlay, as the cost of employees and equipment will lead to more outgoings than income during their first days, but working on a growth strategy will in the end generate more sales where there is demand.

Building a team that is incentivised through sales commissions and bonuses, creates an ambitious workforce and a successful business with the right employees. Some of the more advanced franchises will have different levels of support available internally that you can utilise for a fee, helping you to gradually expand your workforce without having to commit to recruiting employees immediately.

3. Get All The Help You Can From The Franchise Brand

Most franchises will provide training for new franchisees, to help them to get up and running as quickly as possible. Some franchisees may provide further support, through mentoring during the first months or years. We recommend that opportunities such as the above are taken, no matter how confident you may be in your abilities to grow your franchise.

4. Be Disciplined. Work Towards Targets And Measure Success

Running a franchise that’s a part of a successful brand doesn’t mean that there is less work involved. Focused effort and meeting realistically set targets will be necessary to manage and build the business. Exerting less effort and riding the coattails of the established brand you're a part of could lead to some success, but you won’t be anywhere near maximising the franchise's full potential.

5. Manage Customers And Retain Them

The likelihood of a franchise thriving or failing will depend in a large part on your ability to build, manage and retain customers. Some businesses make the mistake of fixating on signing new customers, without giving thought on how to; effectively maximise their sales margin, manage enquiries and retain them over time.

Thought has to go into how you are going to maximise your sales margin.

Can you focus on better-quality leads?
Do you conduct research to compare what your customers are currently paying, so you can be price competitive whilst maximising your margin?

Managing customers can be an art in itself. Some customers are pleasant and easy to deal with, while others may be rude or confrontational and may present you with unrealistic demands.

At times you may be faced with challenging enquiries that are hard to complete, or customers forever threatening to leave unless some sort of compensatory reward or discount is applied.