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to 60 days of conversation or two chats a week and
one face-to-face meeting?
You can run credit, driving history, criminal
background checks and utilize personality profiling
tools — all of which are important, but there are
opportunities to learn so much more through the world
we live in. Consider the length of your typical sales
process. Recognizing that time kills all deals, most
franchisors try to run the shortest timeframe possible
while giving prospective buyers time to properly
evaluate the opportunity. The financial burden is
extremely high. Industry sources such as FRANdata
and Franchise Update Media Group estimate the
average cost per deal between $10,000 and $25,000
or more, and this doesn’t include compensating the
salesperson. The bottom line: franchise development
efforts are very expensive and also one of the most
important elements of a successful franchise company.
WHAT MOTIVATES PROSPECTS TO MAKE A
CHANGE?
Prospective franchisees are learning everything
they can about a brand as quickly as possible in order
to make an informed decision. Given the readily
available data, shouldn’t we be doing the same
thing to get to know our prospects personally and
professionally?
Many of our franchise prospects today try to
connect with us on social media or at least look at our
profiles, both personal and corporate, to investigate
the development staff, executive team and our
company during the process and beyond. I encourage
all franchisors to accept most of these invitations as
a means of getting to better know our prospective
franchisees.
This may cause concern for some who prefer some
level of personal privacy. On the other hand, we should
consider the opportunity it creates to help better vet
prospects and see what interests and drivers they
have motivating them to make a major change.
After all, the efforts each party goes through to
properly conduct due diligence is expensive and time
consuming, but well worth the effort. Think about
the last time you made a major purchase, sought
employment, or tried to volunteer for a school,
church or youth sports league. Most of the time we
are accustomed to being “checked out,” whether it
is simply pulling our credit or driving records, or even
criminal backgrounds and histories.
We need to adopt policies and practices in our
franchise development processes that allow us to
portray ourselves and our companies in manners that
address prospects’ emotional drivers while we engage
and get to know them. Part of this effort involves
not just being selective in who we administer these
processes with, but doing it with every candidate at
the appropriate time in the development process. Do
it smartly, in a non-alarming way and don’t be afraid to
research the people you plan to do business with over
the next 10 to 20 years. After all, they are doing the
same thing to every company they consider.
By not being responsible franchisors and fully
vetting prospective franchisees, we run the risk of
bringing in under-performing franchisees and setting
our brands up for additional headaches down the road.
We also run the risk of thinking we have a great new
franchisee only to find out during the lending process
that he is not able to access the necessary funding for
the project. Now both parties have wasted time and
money on someone who shouldn’t have been awarded
a franchise in the first place.
SET YOUR BRAND UP FOR SUCCESS
As we evolve and adapt our franchise development
processes we should keep in mind certain types
of franchise companies draw more scrutiny from
customers, lenders or suppliers. With readily available
information, partners and customers can quickly and
easily find out about our franchisees — meaning
one “bad apple” can really impact your growth and
development, both short and long term.
Technology and information are reshaping our
franchise development efforts. Properly using it
to identify and vet the right prospects will set our
franchise brands up for success. No longer are the
old staples like credit pulls or background checks
sufficient. It’s not a question of should we incorporate
all of these new sources of information, it’s a matter of
how and when and in what manner that makes sense
given our development process and franchise offering.
To arrive at the “perfect” new franchisee we must
gather as much relevant information and incorporate
these practices into our marketing and development
processes routinely.
Kevin Drudge, CFE, is Chief Development
Officer at AdvantaClean. Find him at
fransocial.franchise.org.
ADOPT POLICIES THAT ADDRESS PROSPECTS’
EMOTIONAL DRIVERS
It has become a mainstream practice in our lives
to protect ourselves, our families and everyone’s
well-being. Don’t be afraid to utilize these traditional
means of vetting prospective franchisees, but also
incorporate these new sources of information at the
same time.
36 FRANCHISING WORLD NOVEMBER 2015