Franchising your business could help you survive the economic downturn
Brian Duckett - Chairman, The Franchising Centre
Converting an existing business to a franchise can give yourself a better chance of weathering the economic downturn.
Many established businesses, some with tens of outlets, some with hundreds, or even one with thousands, are currently exploring the advantages of converting some, or all of them, from company managed outlets to franchised. In doing so, the costs and hassles of the day to day operation of the business are transferred to the franchisee who may be the previous manager, but is now more motivated to operate it more profitably because it is their own business.
One of the biggest benefits of conversion franchising is that it provides the franchisor with a team of motivated business owners, who will be dedicated to growing their own business for the personal reward it offers.
The assumption is that they will be more enthusiastic and energised than an employed manager, whose only financial interest in the business is the salary it provides.
Time and again our clients have demonstrated that almost as soon as a branch converts from managed to franchised that within weeks sales go up and running costs go down. When you consider the business often has the same manager (now running it as his own business), and is in the same premises with the same stock and staff, franchising can, and does, have a miraculous effect on a branch that may have previously have been only marginally successful.
Customer service usually improves because a franchisee is more likely than an employee to go the extra mile. Costs such as cleaning go down because the franchisee does it himself, and staf often rally down to support their new employer as they feel they are no longer just a small cog in a big corporate wheel.
The franchisee takes control of the business, providing yet another benefit to the franchisor. Not only does he take responsibility for sales, but also deals with all the administration and employment hassles, leaving the franchisor to get on with running the core business, developing new products and services and promoting the brand for the benefit of all concerned.
In my next article I will outline a two more forms of conversion franchising…
Brian Duckett is Chairman of The Franchising Centre with over 30 years experience in the franchise industry. The Franchising Centre helps and supports potential and existing franchisors. Click here to find out more.
Tags: brian duckett, Downturn, economy, franchise a business, franchising
