Choose Wisely: Some Franchise Candidates Are Great Franchisee #1’s, While Others Need to Be #101
By: Jonathan Thiessen, Chief Development Officer, Home Franchise Concepts
My daughter recently cajoled me into watching the season premiere of “The Bachelor.” With all the contestants dressed to the nines and (apparently) on their very best behavior, I wondered aloud how he would ever be able to choose. My daughter laughed and explained that if I watched long enough, it would become apparent when their true colors started to show or “when the crazy comes out.”
That made me think about the challenges an Emerging Franchisor has with selecting their cornerstone franchisees.
Anyone who has ever launched a new brand into the franchising arena can remember the thrill of talking to the first handful of people who raised their hands by filling out a web form, engaging at a home show, or (to completely date myself) filling out a tear-out request from a magazine and mail it in (is that a 1 or a 7 in the phone number?) You are sure they will fall in love with your brand “baby” in the same way you have in the months/years leading up to this moment, and you can’t wait to tell them all about it.
While your enthusiasm for telling your brand story should be at an all-time high, you are almost at your most vulnerable as an emerging Franchisor. You are anxious to put pins in the map. You’ve already mentally composed the social media post that will shout your initial growth from the LinkedIn rooftops. You’re debating what kind of cake goes best with Grand Openings. However, before rushing to the altar with these initial candidates, I’d encourage you to park your emotions and evaluate whether this should be Franchisee #1 or if they would be better as Franchisee #101.
Aptitude for Risk: While you are without a doubt that your brand is the “next big thing,” until you have a history of successfully operating franchisees, it still falls into the category of “unproven.” Just because you ran a successful corporate store does not “prove” that you will be successful as a Franchisor. In Franchise Development, we are constantly talking about the value of a “proven model” and you need initial franchisees who are okay with the fact that you don’t have one. Franchisee #101 wants to know if the cake is fully baked. Franchise #1 intends to crack eggs with you.
Communicators: To build the franchise system you envision, you must become an expert listener. It’s hard to listen, though, if you aren’t starting with the kind of franchisees willing to collaborate and provide feedback from the field. Franchisee #101 can internalize their ideas and concerns. Franchisee #1 needs to be willing to blow up your phone constructively.
Great Validators: Your early adaptors will be extremely busy starting their new businesses and working with you to fine-tune the model. Oh, and you can add fielding a ton of validation calls to that list…and that can be problematic for the wrong #1’s. The first few validation calls are exhilarating for the new franchisee as they get to tell their story and their passion for the brand. It’s the 40th call, on the heels of a day where just about everything that could go wrong did, where the right Franchisee #1 pulls up their bootstraps and validates that it’s a lot of work, but they are convinced it’s going to be worth it. I highly recommend trying to lift as much of the time burden from your early franchisees by setting up group calls or creating a library of validation calls.
Leadership: Since we were kids in elementary school, we’ve all witnessed the teacher ask for volunteers to be “line leaders,” and the same kid’s hands would always shoot up. At the same time, the usual suspects were always more comfortable in the back. Those “line leaders” don’t always know what they are getting into, but they have the confidence in their ability to influence others that they are willing to put themselves up there. Franchisee #101 must hang back to ensure they know what to expect. Franchisee #1 just wants a compass and a machete.
Passion & Patience: When I think about my ideal #1’s, the litmus test I always used was to ask myself, “If someone was listening to this person talk about the brand in an elevator or at a cocktail party, would they be able to tell if they were a Franchisee or a Franchisor?” They must be able to match my passion for the success of the brand and our mission to wear the #1 on their jersey. I would never allow my first franchisees to be silent investors or semi-absentee owners. I want them to experience the results of our great work every day. I want them rewarded with their employees’ smiles and their clients’ gratitude. At the same time, they need to understand why we call it “building” a business and can stop running and walk sometimes. I want my #101’s to have this too, but it’s not as essential the further you go from #1.
Well Capitalized: I know this probably feels like table stakes, but it’s easy to loosen up your requirements if your potential #1 meets all the requirements above—and you just can’t. Even the best pilots need a minimum amount of runway to get off the ground, and given that much of this still rests in the “unproven” category, I’d suggest adding a half-mile of concrete to yours to be safe.
Growing your franchise family can be exhilarating yet nerve-wracking all at the same time. Before you start giving out your roses, make sure that the answer to these considerations is a resounding “Hell, yes!”…if not, it needs to be a “no.”
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