How to create a successful franchise: 4 golden rules
Instead of increasing the number of franchises, unfortunately, their quality decreases and confidence among franchisees decreases. The rules for creating a successful franchise are shared by Oleg Yudin, director of franchising at Domino’s Pizza.
Franchising is rapidly gaining popularity. One of the decisive factors in this matter is the crisis, condemning Russian business to instability and uncertainty in the future. The purchase of a franchise eliminates this issue by providing an already developed business model with prescribed solutions to possible risks.
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Buying a franchise interests both newcomers and experienced entrepreneurs seeking to develop their business from new perspectives. Unfortunately, due to growing demand, a large number of low-quality franchises have appeared in the market, undermining the trust of potential franchisees. So how do you create a truly high-quality and successful franchise that will work great and make the franchisee profitable?
1. Franchise is about development, not about sales
If the main income of the franchisor comes exclusively from the sale of franchises, and he forgot about opening his own establishments long ago, then he can hardly be trusted. This means that this business model is not effective, since the franchisor earns exclusively on lump-sum payments and royalties, and no one cares about the fate of the project.
2. If support, then in everything
It is worth paying attention to the fact that a successful franchise always includes supporting the franchisee in any organizational aspects, from the selection of locations to the selection of personnel. I want to note that the solution of these issues lies entirely on the shoulders of the franchisor, for example, the client should not independently go in search of a location for his institution, escort of the franchisor is mandatory here. And, of course, the franchise should include marketing, operational, IT, HR and other types of support, providing assistance to the franchisee in any of its areas of activity.
Franchising Domino’s Pizza
3. Don’t leave your own
Franchisee support should be provided both before, after, and at the time of opening a business. After the decision to open an institution, an employee should be allocated, providing support for the franchisee: by phone and e-mail, and also once a few months independently checking how the franchisee works and develops. The presence of such an employee will help to correctly identify possible errors and eliminate them to improve the quality of the institution.
After starting a business, one can hardly relax and stop helping franchisees. In the first year, a fairly large number of companies are “drowning”, so do not forget that a newcomer who needs the support of an experienced mentor is at the helm, otherwise his path will be short-lived. By the way, when choosing a franchisor, people often request feedback from previous franchisees, so it’s in your interests to control the development of their business according to your franchise.
4. Training = success
Do not forget about such an important point as the training of employees and, if necessary, the franchisee. Training should be carried out by professional trainers in teaching aids and in no case “on the knee”. For example, at Domino’s Pizza, our study is completed, as in any educational institution, with an exam. And passing it is not so simple. This is quite an important point, because the success of a business depends not only on the work of managers, marketers, and so on, but also on staff. Therefore, do not lose sight of the issue of training.
Domino’s Pizza Staff
Creating a franchise is an excellent solution that will help to promote your own business, and will begin the work of other institutions, supporting novice businessmen. However, do not forget that most people come to franchising wanting to protect the business that they have from bankruptcy and crisis, or looking for a reliable franchisor to support when starting a business, so you need to be as responsible as possible about creating a franchise. It should not just be – it must be of high quality. Then its work will be effective, the number of institutions working on your franchise will increase, the franchisee will be larger, and you and your franchisee will benefit as a result.