Make your Franchise Stand Out

Figure out what makes your franchise different and sell that to franchise buyers.

Make your Franchise Stand Out

If you’re interested in starting a franchise, you have a lot of company. With many franchisors for franchisees to choose from, how do you stand out from the crowd? How do you create a unique selling proposition (USP) that will allow you to compete?

Finding Your Small Pond

When facing the task of creating this USP, you should start by understanding that every buyer’s universe is different. No franchise buyer would ever attempt to analyse the thousands of franchisors in the marketplace.

Some will start by choosing a specific industry segment in which they are interested or that capitalises on their skills or experience. They may narrow the list based on how they examine the marketplace – using brokers, trade shows, franchise directories or the Internet.

Some will be interested only in established franchisors, while others will be looking to get in on the ‘ground floor’ of a franchise poised for explosive growth. Many will eliminate franchisors quickly, based on size of investment and their available capital. In short, every buyer’s process will be both different and smaller than the universe of all available franchise concepts.

For you, as a new franchisor, this is good news. Although most franchise buyers are not fishing in your pond, the buyers that are, will be fishing in a much smaller body of water. That means an understanding of your specific pond, and what fish are in it, should be the first order of business.

Armed with this knowledge, you must then narrow your buyer profile as much as possible.

Part of this process can be intuitive, but more often the only way to obtain this understanding is research – talking to either your own franchisees or those of your closest competitors for insight into buyer motivation, media and the specific message that will sell to your audience.

The Many Sales of Franchising

The savvy franchisor also instinctively understands that there is not simply one sale to make, but rather four separate sales that each franchise sales person must undertake. Prospects are likely to ask themselves four basic questions:

  • Should I go into business for myself?
  • Should I go into the widget business?
  • Should I go it alone or buy a franchise?
  • Should I buy your widget franchise?

The answer to the first question, of course, is a mainstay of any franchise sales presentation. But this answer will be similar for most franchisors.

The answer to the second question will need to be woven into your sales and marketing strategies. To answer it, you need to understand and develop the selling proposition for the widget industry, but chances are it is not ‘unique’ but a shared message promulgated by all your closest direct competitors. Only when you’re in the enviable position of being the only player in a market segment can this question yield a true USP.

The third question offers little room for uniqueness. Do you offer any support services not offered by other franchises? Do you provide guarantees? For most franchise concepts, while the question is integral to franchise sales, the answer will be similar across many franchises.

So the core of the USP lies not in differentiating a concept from the vast herd of franchisors, but in differentiating it from your closest direct competitors.

Putting the ‘U’ in USP

A behemoth now, the McDonald’s juggernaut started with a single location. Before they captured the American consumer’s ‘mind share’ for fast-food burgers, they had dozens of competitors.

So why was Burger King successful while so many others failed? The main factor can be boiled down to a single sentence: “Have it your way.” Burger King positioned itself to be different from McDonald’s, not just a ‘me-too’ operation. It was positioned in such a way that McDonald’s could not respond competitively – because in order to do so, McDonald’s would have had to revisit its entire kitchen operations.

Finding Your Differentiator

There are a number of ways in which a company can differentiate itself. For those who are first to enter a new industry or niche, the most dominant position to seek is that of market leader. To achieve that status, a company must grow rapidly enough to achieve brand recognition.

For the rest of us, we need to become the best at something – either the biggest, cheapest, fastest, easiest or hottest. A company can try to be two of these things at once, but those that try to be ‘all things to all people’ quickly find they  only succeed at being mediocre at everything – a guarantee of long-term failure.

Aside from the concept itself, you can also differentiate yourself by size of the initial investment, target market, geography, quality of services provided to franchisees and franchise structure. A cautionary note: those taking the cheapest route should focus on minimising the franchisee’s investment, not the royalty structure.

Regardless of where this differentiation occurs, “stake out” the areas where you want to excel, develop a USP around those areas and acknowledge the areas in which you’ll allow competition.

Franchise Zone
About the Author
Franchise Zone is published by Entrepreneur Media SA. It offers advice and franchising opportunities in South Africa.

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