As a franchise consultant, people often ask me “What are the common mistakes that Franchisors make when you franchise your business?” There are a number of errors that can negatively affect the Franchisor’s company when you franchise your business, including the following:
- Compromising on the site selection process
- Selling too many franchises too quickly when you first franchise your business
- Not requiring the Franchise Owner to complete the initial training program
- Picking the wrong person as a Franchise Owner when you franchise your business
- Compromising the brand’s trade name and logo
When you franchise your business, it is imperative that the new Franchise Owner follows the Franchisor’s site selection guidelines.
Some of the guidelines include the size of the franchise location, the nature of the neighborhood, the demographics in the area, ease of access to the potential site, nearby businesses, the site’s visibility, available parking for customers and employees of the franchised business, rental rate and other costs of the proposed site. When you franchise your business, if you allow your Franchise Owners to select poor locations, the future of the franchises can be jeopardized.
When you franchise your business, it is important that you do not sell too many franchises at the beginning. Key factors to your franchise program’s success when you franchise your business are your initial training program and on-going servicing of the Franchise Owner by Franchisor support personnel. If you concentrate your efforts on selling more franchises, you run the risk of not having enough personnel to help your new Franchise Owners effectively solve their operational challenges.
When you franchise your business, it is important that the Franchise Owner and his/her staff are fully trained. If a Franchise Owner cannot or will not successfully complete the initial training program, you must require him/her to repeat the training program until it has been mastered. When you franchise your business, you cannot allow a poorly trained Franchise Owner to represent your brand. Failure to complete the training program could result in termination of the Franchise Agreement with no refund of the Initial Franchise Fee to the Franchise Owner.