What is the best advice you would give a franchisee?
Initial and ongoing training is vital. A franchisee needs to focus on training and know the business system inside out before opening since unnecessary mistakes can cost you money. Attend all meetings and training sessions as you can never stop learning – if you learn one thing that can help you, it will have been worthwhile.
I have been in the food business for over 25 years and I am still learning. Ask for help if you need it, since a franchisor of a large group cannot always know that you’re in trouble.
What do you think some of the most common misconceptions among franchisees are?
- You bought a franchise within an established brand and will now get rich. Whilst a recognised franchise system increases your chances, your ultimate success will depend on your own competence and commitment.
- A franchise system works so I won’t have to be there all the time. You’ll have to work hard to establish your business until it begins to generate a profit, as owner-run businesses are far more successful than manager-run businesses.
- It’s my business and I’m my own boss. Whilst this is true to some extent, decisions regarding the franchise group will be made by the franchisor and you’ll have to comply with these decisions.
- Franchisees believe that the franchisor will do all the marketing for them and business will prosper. The marketing fund is usually spent to benefit the entire group and not just one franchise. So the reality is that marketing is also the responsibility of the franchisee.
What do you think the ‘next big thing’ in franchising is?
The franchise industry has been growing at a rapid rate and people see that franchises work. I see more low capital investment franchise opportunities being developed but fear that some of them will not necessarily come with high rewards.
What do you think the biggest challenge for the franchising industry currently is?
I feel the recession is still biting. The greatest obstacle that has held me back has been the high rentals being charged by landlords. Growth of my group has been slowed down as I cannot put franchisees in these sites knowing that they’ll struggle.
The bigger landlords are the worst culprits and continue putting up rentals even if they know their tenants will not make it. The malls aren’t as busy as they used to be so paying these higher rentals is not justified. Franchisees have been hit by bigger expenses, and high electricity bills have affected their bottom line.