Last week, Matthew Cancino and I spent three days in New Orleans networking, learning, and having some fun too at the 2023 Emerging Franchisor Conference. I took too many notes, and not enough photos, and simmered it all down to these 10 key takeaways. What happens in NOLA doesn’t need to stay in NOLA, so I’m sharing these for all current and future emerging franchisors.
This is my second year going to (and sponsoring) this conference. Here are the takeaways from the 2022 Emerging Franchisor Conference.
Though I represent a franchise supplier/sponsor, I compiled these takeaways for the benefit of our emerging franchisor clients and of any other businesses that consider franchising as a way of expansion. This conference offers a wealth of knowledge and insights from experienced franchisors.
Takeaway #1: The value of company-owned stores
Validate your franchise idea by replicating your concept in one or several company-owned stores. This is a great way to test your systems and generate cash flow. More cash flow means you get to keep more equity. But their value goes on: they are the playground for testing new ideas before rolling them out to franchisees (like a new recipe, a new marketing campaign, or a new software.) However, make sure they have a separate support team (don’t use the marketing fund and the corporate marketing team!)
Takeaways #2: Learn to love something new
Franchising will take you away from the business you love, and you’ll have to learn to love franchising more than you love your original business. (I find that to be true of business and leadership in general; I started as a graphic designer, but I had to learn to love running an agency more than I loved designing websites.)
Takeaway #3: The cost of open & profitable
Only franchise when you know how much it costs to get one franchise location open and profitable. That’s the only way to grow responsibly and sustainably. If franchisees are profitable, most of the first years’ franchise sales come from referrals.
Takeaway #4: Don’t be your franchise’s bottleneck
“At some point, some of you will be the ones holding your companies back,” said Mary Thompson, COO of Neighborly. She spoke from the perspective of a platform brand that acquires small brands; however, throughout the conference, I picked up other supporting ideas from various speakers. The founder, who successfully ran a few dozen company stores, was not able to successfully lead a franchise. Most franchise brands don’t make it past the 100-unit mark because what got them there won’t get them beyond.
Takeaway #5: The quadrant of franchisee relationships:
|successful & engaged|
(call them often!)
|successful & disengaged|
|unsuccessful & engaged|
(likely new, need support)
|unsuccessful & disengaged|
(decide if you should get rid of)
Takeaway #6: The key to good franchisee/franchisor relationships in one word
- Empathy. “Please remind me that I matter” – Clement Troutman, Tropical Smoothie Cafe franchise owner
- Alignment. “Seek alignment” – Saunda McDaniel, Mr. Rooter franchise owner
- Love & trust. Where trust is defined in terms of Steven Covey’s four pillars of trust: integrity, intent, capabilities, and results – Mary Thompson, COO at Neighborly.
- TRUST – Charles Watson, CEO, Tropical Smoothie Cafe.
T = transparent;
R = responsible;
U = unique (we’re all snowflakes!);
S = service-oriented; to serve someone is the greatest gift;
T = tenacious.
Takeaway #7: Marketing fund and brand standards
“If you don’t have a marketing fund in your FDD, change that now.” – Ashley Mitchell, SVP Marketing at Streamline Brands. Work together with the franchisees to approve a marketing budget; show them how it will be used and ask them to vote on it. A franchise owner remarked how she chose her brand because of the brand name, because of the website, and because of the marketing. Tightening the brand standards is a good thing because all the other units will follow them, too. “But that’s because I have buy-in,” she added.
Takeaway #8: Use measurable KPIs
Clarissa Bradstock, CEO at Any Lab Test Now!: “If you tell a franchisee: ‘you just need to pay more attention to marketing’ – that’s overwhelming to them. Pick two KPIs and work on them.” Make 24 calls and book 4 appointments.
Takeaway #9: Stay clear of the “nephew SEO”
“Do not use your nephew to do your SEO,” said Clarissa Bradstock. Agencies outside of franchising don’t understand the multifaceted aspects of franchise marketing, including local marketing in diverse areas.
Finally, my favorite takeaway came from Bud Summers, EVP of Operations at PuroClean, who paraphrased something that David Barr said in the opening session.
Takeaway #10: Think “average”
Everyone is looking for a rockstar, but in reality, franchising is for the average person of average intelligence in an average city on an average day.
Want more Tips for Emerging Franchisors?
If you found this valuable, you might also like to read this short article in which I outline Marketing Strategies and Best Practices for Emerging Franchisors.