Are you thinking about buying a franchise? There's a lot you
need to know before you invest if you want to be successful as a
franchisee. My new manual, The
Franchise Buyer's Manual is a self-help manual that helps you
decide whether or not franchising is for you and teaches you how to get the
information you really need to choose the best franchise opportunity for you.
Click here for more information.
Managing social media can be difficult and time consuming, whether it’s a Facebook page or Twitter account. For a franchisor and its franchisees, these challenges can be even greater and much more difficult to manage. Learn how to keep
social media content fresh while engaging your customers.
Look Before You Leap: Due Diligence By Prospective Franchisees
It’s important that prospective franchisees perform a
comprehensive due diligence
before purchasing a franchise. This article by franchisee attorney, Jeffrey
M. Goldstein, provides insight into this important subject.
CareMinders: A Home Healthcare Franchise with a Purpose
Recently I had the opportunity to interview Gary Kneller, President of
CareMinders Home Care.
Scrutinizing Franchise Legal Claims
Franchisees need to carefully consider their actions when faced with a
franchisor that is seeking claims
and recourse for violations under the terms of the franchise agreement.
Social Media: For Franchisors the Future is Now
Various social media analysts confirm the strength and continued growth
of social media. Franchisors need to
embrace social media in order
to maintain their market presence and grow their brand.
A Cautionary Tale On Arbitration Clauses For Prospective Franchisees
The following case demonstrates why individuals considering executing a
franchise agreement in California should be cautious regarding franchise
agreements that contain an arbitration clause. Learn why it’s important to
utilize experienced franchise
counsel.
What Are You Doing To Monetize Cold Franchise Buyer Prospects?
Franchising Should Take a Lead from Theodore Levitt
The surging popularity of Facebook and Twitter can cause us to stray from the
basics of marketing. In spite of new technology the
principles of marketing
remain the same.
What Makes a Franchisee Successful?
In a previous article I presented what, in my opinion, makes an effective
franchise leader. This article looks at the other side of the relationship
between a franchisor and franchisee, namely,
what makes a successful
franchisee.
What Makes an Effective Franchise Leader
The effective leadership of a franchise company requires a particular
approach not applicable to most companies. This article presents five key
areas that franchise executives should embody as a part of their
leadership style.
China Should Enforce New Laws to Protect Franchisors
How Fledging Franchisors Can Survive the Recession
As businesses continue to struggle through the recession emerging and
smaller franchisors that are attempting to grow their network can face
obstacles. However, there are steps that can be taken which can lead to
successful outcomes. Read more to see
what these steps are.
A Successful Franchise Below the Radar: The Murphy Business Franchise
Recently I interviewed Roger Murphy the founder of Murphy Business and Financial Services. Franchising since 2006,
Murphy Business and Financial Services franchise has become a successful operation with 127 franchisees.
Private Equity in Franchising: The Upside and the Downside (Part 2)
In part two of my article on the role of
private equity in the franchise
industry, we look at which kind of franchisors are attractive to PE
firms, the evaluation process, along with the impact on the franchisees of
acquired companies and what’s in the future.
The Role of Private Equity in Franchising: The Upside and the Downside
This is the first of a two part series on the role of private equity
funds in the franchise industry. We’ll examine a number of issues, including
why there has been a dramatic increase in
PE investments in franchise concepts,
the benefits for franchisors, the impact on the franchisees of acquired
companies and what’s in the future.
Starting Up a Franchise Company the Right Way: The MoneySaver Franchise
India continues to offer increased franchise opportunities for U.S franchisors with the world’s largest middle class.
Understanding Indian franchise regulations is an important component for entering the Indian market.
Franchisors Must Use Social Media
Franchisors need to get on the social media bandwagon. Reports that measure social media indicate that its use continues to grow and that it’s is being used by more and more people. Following is what some experts have to say about the use and effectiveness of
social media and its role in franchising.
Sound Leadership Practices for Franchise Operators
Interviewing Franchisees and Employees: Part 2, Developing a Structured
Interview
In part 2 you’ll learn how to develop your own franchisee or employee
interview related questions. There are sample questions you can use for
employee
interviews and for qualifying prospective franchisees.
Franchisors looking to grow their system can have a tendency to focus on a
single approach; namely selling more unit franchises. However, this strategy
should be adjusted, so that it’s not the only way to
grow the franchise network.
There are a number of advantages in owning a home based franchise. However,
there can be disadvantages as well. Franchisees and franchisors should focus on
the pros and cons of home based
franchises when making their respective decisions.
Should Franchisors Encourage a Franchisee Association?
The establishment of the Coalition of Franchisee Associations and its
ratification of the Franchisee Bill of Rights could portend more franchisees
seeking to organize their own associations.
How should franchisors deal with the formation of a franchisee association?
Resist, encourage, and remain neutral?
Does the Massachusetts Fair Franchising Act Have Legs
When you Buy a Franchise Pretend You’re Selling It in Five Years
When individuals purchase a franchise most will plan on selling the franchise
at some future date or operate it until their children can take it over. I’ve
encountered some individuals who plan on operating the franchise for the long
term until retirement. If you’re considering buying a franchise a good approach
to take is to plan on selling the franchise as part of your analysis.
Learn why this strategy can be helpful.
Planning on a Partner for Your Franchise? Here are some Pro’s and Con’s
It’s not uncommon for prospective franchisees to plan on having a partner for
their new franchise. However, there are advantages and disadvantages to a
franchise partnership. Here are some
pros and cons.
Accounts Receivable Factoring: A Source of Capital
During these tough economic times many franchisees have difficulty obtaining
working capital, factoring can be a quick and reasonably priced source of
capital. This article presents some reasons why.
Operating a Successful Franchise: Not as Easy as it May Seem
Social media continues to grow in popularity and is being employed as a marketing strategy by an increased numbers of franchisors. I wrote an article for
FLAME®the publication of the Burger King National Franchise Association. It provides an
overview of the franchise restaurant sector and its use of social media.
Conversion Franchising: Just What the Doctor Ordered
An increasing number of franchisors are offering some form of financing to
prospective franchisees. There is a requirement that this information be
disclosed in the Franchise Disclosure Document.
This article explains the disclosure
requirements for financing.
Creative Ways for Franchisors to Attract New Franchisees
For the past several years, the recession and the resulting reduction in the
traditional sources of new franchisee investment capital has slowed the growth
of new franchisees. The real estate market has shrunk home equity values and
small and medium banks have significantly tightened business loans.
Here are some creative ways franchisors can
stimulate new franchise growth.
The fitness industry continues to be one of the fastest growing concepts in
the franchise industry. This article provides a look inside the
fitness
franchise craze and why this sector will continue to grow.
The Universal Franchisee Bill of Rights
At a recent meeting the Coalition of Franchisee Associations ( CFA) ratified
the Universal Franchisee Bill of Rights. It’s important that franchisors and
franchisees understand what this
document states.
Women are playing an ever increasing role in the franchise industry both as franchisees and franchisor executives. There are certain traits that women have which make them excellent franchisees.
Learn why women and franchising are a perfect fit.
It’s Important That Franchise Leaders Control Their Egos
Effective leadership often requires striking a balance between ones ego and
the need to solicit and encourage constructive feedback. Because
franchisors must lead their organization, employees and franchisees to their
respective goals, it’s important that ego not
impede these important objectives.
Franchisor Competency: As Important as the Franchise Concept
There are hundreds of franchise opportunities that are based upon a sound
franchise concept but for various reasons never reach their full potential.
Newly emerging franchise companies need to have competent leadership as well as
the necessary financial resources in order to succeed. Although a sound business
model is a prerequisite for a successful franchise so too are the
business
skills and the experience of the franchise leader.
Not All Franchisees Are Created Equal
It’s a proven fact that buying a franchise is not a guarantee of success.
Moreover, there are few McDonald’s in the franchise world where a powerful
brand, top notch operating system and a history of near flawless site selection
leads franchisees to success by following the “Program.” Rather, many
franchise systems fall short in certain areas, which may require its franchisees
to overcome these shortcomings.
The Franchisor-Franchisee Relationship: A Tale of a Failed Store
Required Disclosures – Initial Fees: Can Provide Prospective Franchisees
with Negotiating Information
Prospective franchisees should fully understand how much the initial
franchise fee and is there an opportunity to negotiate lower fees. It’s also
important to know if the franchise fee or any portion of the fee is
refundable. Read more >>
Franchisors and Franchisees Must Avoid the Peter Principle
It’s important that franchisors and franchisees maintain a sense of balance
when it comes to franchisee growth. While some franchisees want more territory
and some franchisors are more than willing to accommodate this request,
it’s
important that this growth be carefully controlled.
Why Franchisors Should Evaluate Their Franchise Competitors
During these challenging economic times, individuals seek the greatest return
on their franchise investment. In order to grow their system franchisors need to
offer the best opportunity and value to prospective franchisees. For these
reasons, it’s important for franchisors to perform a competitive analysis of
franchisors that are direct and indirect competitors.
Protection After You Purchase: State Franchise Relationship Laws
In a report by Franchise Update Media Group, 57% of the franchisors
responding to the survey reported using franchise brokers. Despite the use of
franchise brokers by franchisors, their use remains somewhat
of a controversy. This article explains why.
Does Your State Have Franchise Disclosure Laws? If Not, Then What?
Before searching for a franchise opportunity, it’s important to understand
how the State you live in or will operate your franchise, regulates franchising.
In terms of franchise regulations some States do very little while others have
strong requirements. Read more >>
Personal Guaranties in Franchise Agreements: to Sign or Not to Sign
Avoid Becoming a Victim of Franchise Fraud (Part 2)
Franchise candidates should know how to use the information in Item 20 of
the Franchise Disclosure Document. Contacting former franchisees and
obtaining information may be more difficult than appears.
Read more >>
Avoid Becoming a Victim of Franchise Fraud (Part 1)
Franchisees and Franchisors Should Share in the Cost of Promotions
Since sales promotions are a necessary strategy that franchise systems
must employ from time to time, franchisors should construct promotions so
that its franchisees look forward to participating.
Read more >>
Post-Expiration Covenants Not to Compete
Franchisees need to understand the impact of certain provisions in their
franchise agreement when the agreement is terminated. One of the most important
post-expiration provisions is the non-compete.
Learn how to deal with the non-compete
issue.
US Supreme Court Decision Could Impact Franchisee Rights
A recent decision by the U.S. Supreme Court pertaining to a case involving
AT&T could have an impact of class action claims brought by franchisees.
Click here to learn more.
Can a Franchisor Collect Future Royalties When a Franchise Agreement is
Terminated?
Franchisors and Franchisees Must Learn to Deal with Change
All organizations need to make changes in order to maintain the vitality of
the business. This is true of franchise companies. When significant changes are
made, franchisors and franchisees must be equipped to
deal with change.
Precise Compliance With Notice Provisions Essential for Franchisors
This article by Craig R. Tractenberg of Nixon Peabody appeared in the
Legal Intelligencer. He uses a recent judicial decision involving Domino’s
Pizza to emphasize the importance of franchisor’s providing timely and
proper notice to its franchisees and updating the operations manual to
reflect operating changes. Read
it here >>
Thinking of Buying a Franchise? The Pro’s and Con’s
Bob Stewart is Managing Director of a British recruitment and
outplacement firm. As a former franchisee, Mr. Stewart offers his
insight and advice regarding
franchising. Whether in Pounds or Dollars the message is the same.
Helpful Tips When Drafting or Revising a Franchise Agreement
New Franchisors as well as existing franchisors may need to consider
changes to their franchise agreement. Before any changes are made its
important to know what your competitors are doing. In addition, franchisors
need to be aware of objections to certain provisions of the current
agreement, made by prospective franchisees and their attorneys.
Read more >>
Information That Will Benefit Franchise Candidates and Franchisors
When selling a franchise the franchisor should provide the franchise
candidate with the information necessary for making an informed decision. On the
other hand, the franchise candidate should know what information they require
before making their decision. This article provides advice for both parties.
KFC Franchisees Ad Council Receives Favorable Ruling Over KFC Corp.
The KFC advertising council can claim victory over franchisor KFC,
regarding the final approval and control of domestic advertising programs.
Read a summary of the case and ruling.
Franchisors Going International Must First Answer Five Questions
A number of franchisors look to development agents for increased system
growth. Despite the benefits this approach can provide, there are also a number
of drawbacks. Read about them here.
Being an avid sports fan I was interested to learn more about the i9Sports franchise. I found it to be a great concept with the right product for children. Its objective in removing the stress and emphasis on winning so prevalent in children's sports is refreshing.
The following is my interview with Brian Sanders, President of i9Sports.
Buying a Franchise through the Eyes of a Franchise Expert
Building and Maintaining Positive Franchise Relations
Franchise relations is the term typically used to refer to the state of the
relationship between a franchisor and its franchisees. It is perhaps one of the
more important matters that franchisors deal with in addition to growing the
franchise network and increasing sales and profits.
Here are four things you can do to build
and maintain positive franchise relations.
FranchiseKnowHow Spotlight Franchise
Bookkeeping Express: What the Small Business Owner Needs
Before Starting Your Franchise Have Your Team Ready to Go
A successful franchise operation requires more than one person to manage the
business. There are a number of reasons why it’s important for a new franchisee
to have their team in place before the franchise is off and running. First, the
franchisor needs to know how the franchisee intends to operate their franchise
before completing the franchise transaction.
Here are some reasons why both the
franchisee and franchisor need to have answers to this particular question.
One of the most important components of a franchisee investment is the
construction work done on the franchisee location. Since this activity is such an important aspect of franchising we welcomed
the chance to meet with Bruce Link, Estimating Department Head of Stalco
Construction. Read the interview here.
Private Equity and Franchising: When Will the Money Get the Game?
To Franchisees: Be Wary of Using Company Credit Cards
When starting up a new franchise, odds are the new franchise owners will be
solicited by credit card issuers. Franchisees need to be cautious when it comes
to the use and control of company credit cards.
What Franchisors can Learn from Traditional Recruiters
Franchisors frequently cite a lack of suitable franchisees as a significant
barrier to their growth. Steven Frost, Franchise Consultant at Smith &
Henderson, explains what they can learn from traditional recruiters to help
overcome this.
Attention Franchisors and Franchisees: A Successful Franchise Shouldn’t Require
Extraordinary Performance
CMIT Solutions franchise network is a franchise company that’s on the right
track, helping small business owners to manage their technology needs. In
addition, this franchisor practices what they preach when it comes to supporting
their franchisees. Read more.
Follow up to Rock Music Franchising Decision- Significant Reward in
Favor of Franchisor
In a previous article on the FranchiseKnowHow web site, Craig Tractenberg
of Nixon Peabody reported on a favorable ruling on behalf of the NP client,
Paul Green School of Rock Music Franchising (PGSORM).
Here's an update on that case.
Whether You’re Selling or Buying a Franchise You Need Consider an Important Fact
Franchisors planning their franchise sales strategy for the short term need to recognize the impact that unemployment rates have on purchasing power. Those individuals looking to purchase a franchise would be well served to
know the employment situation in a territory they are considering.
Patricia Beckman, founder and CEO of Cybertary has developed a unique
franchise concept that provides a number of services for business owners while
offering individuals a reasonably priced home based franchise opportunity.
Following is an interview with Cybertary's founder Patricia Beckman.
Sourcing Capital
Investments
From
time to time, franchisors and large multi-unit franchisees seek
large capital investments. The key to success is knowing where to
look and what investors will want to know. Here is a presentation
that will put you on the right track for
sourcing capital.
Prospective Franchisees and Franchisors Should see These Statistics
In a previous article I presented the advantages and disadvantages of
purchasing a franchise from a new franchisor. This article provides key factors
that should be considered before making your decision.
Learn how to evaluate the
start-up franchise company.
Franchisees Gain New Financial Benefits Under the Small Business Act
The Small Business Jobs and Credit Act which was just signed by President
Obama provides benefits for franchisees and particularly those franchisees in
the restaurant sector. Here is a short summary of the benefits.
Purchasing a Start-Up Franchise? Here are some Advantages and Disadvantages
Hundreds of new franchises start up every year. Some of these new franchises
can represent a good opportunity for prospective franchisees however; these
individuals need to understand the pros and cons of investing in a brand new
franchise. Here are some of the important considerations to look for.
Franchisors Should be Careful When "Selling" a Franchise
Franchisors should avoid the aggressive "selling" of a franchise; they should
direct their efforts into providing prospective franchisees the information
needed to make an educated and well informed decision.
Learn why this is
important.
Franchisees File Law Suit Against Edible Arrangements
Edible Arrangements the franchisor that sells floral like designs from
sculpted fresh fruit has been sued by a group of franchisees.
Read further
details of this story.
What do Franchisees Really Think about Their Franchise?
Franchisors should know the satisfaction level of their franchisees.
Although, the options for measuring franchisee satisfaction are limited, there
is an effective way to obtain this information. We interviewed two companies
that provide the answers to the questions franchisors should be asking their
franchisees.
Choice of Law and Forum Clarified in Recent
Franchise Cases
This article on choice
of law and forum provides insight into non-compete provisions in
franchise agreements as regards California law. Franchisors and franchisees
will find the results of these recent decisions helpful.
Five Indicators of a Successful Franchise Program
There are certain attributes that all successful franchise programs
share. This article presents five of the most important attributes. Whether
you’re a franchisor or an individual looking to purchase a franchise read
this article to learn about what successful franchises have in common.
How Franchisees Can Perform Effective Employee Evaluations
An Interview with Ron Berger, Franchise Industry Leader and CEO of Figaro’s
Pizza
This is the second part of an interview with Ron Berger, CEO of Figaro’s
Pizza. (Read Part 1 here.) Ron has been in the franchise industry for 36 years and has been a member
of the IFA Board of Directors in the 1980’s, 90’s and until February, 2010.
Part
2 of our interview includes a discussion of recent acquisitions by Figaro’s and
a program that enables existing Figaro’s franchisees to benefit directly from
the acquisition.
Technology and Franchise Marketing: An Interview with Nick Simard of
InspiriaMedia.
FranchiseKnowHow wanted to get some answers about how social media, smart
phones and mobile websites are impacting marketing strategies. We called
upon InspiriaMedia a marketing firm located in White Plains, NY.
Here's our interview with co-owner Nick Simard.
10 Things Franchisees Should Know About Their Competitors
Looking for a Franchise? Consider Purchasing an Existing Franchise
If you’re thinking of purchasing a new franchise, you may want to consider
purchasing an existing franchise. Statistics indicate that, on average, a
typical business changes ownership every four years. Franchised businesses are a
part of this universe, and studies undertaken by the business brokerage industry
report that franchised businesses follow the same pattern.
Here are some things to keep in mind
before purchasing an existing franchise.
FranchiseKnowHow Introduces Online Business Courses
We've partnered with MindEdge, a premier online learning provider, to
introduce a library of online business, management, communication and leadership
courses.
These professional development courses are designed to enhance skills in
Leadership, Management and more. All programs are condensed versions of courses
developed for, and in collaboration with colleges and universities such as the
Harvard Business School, Boston University, and other world-class institutions
of higher education.
A major reason people buy a franchise is to own a business with a proven
operating and marketing system, a recognized brand and support services.
Despite these features, the individual franchisee is responsible for growing
his business. Here are 10 ways franchisees can increase their sales at the
local level.
Buying a Franchise? You Better Understand Item 7 of the FDD
Item 7 in the Franchise Disclosure Document requires franchisors to set out
in a prescribed format a franchisee’s estimated initial investment needed to
start the franchise business. It’s important for individuals looking to purchase
a franchise to fully understand what Item 7 contains. A leading cause of
franchisee failure is being undercapitalized.
Learn how to avoid falling into
that situation.
The Benefits of a Franchise Preferred Vendor Program
Home Based Franchises Grow in Popularity but Operating These Franchises
Requires Certain Skills
As the popularity of virtual or home office businesses increase, so do
franchises that can be operated from the home. Home based franchises provide
individuals an opportunity to purchase a low cost franchise with the added
flexibility of a home based operation. However, there
are certain challenges that a home based office presents.
Five Lessons Franchisors Can Learn From Network Marketers to Expand And
Build Their Franchise Companies
Franchise companies tend to think of themselves as a level or two (at
least) above multi-level marketing (MLM) companies, but having worked in
both industries I have discovered that MLMers (or network marketers) do some
things more efficiently and effectively than do many franchisors.
Here are five things you can learn from the
MLM community to help your franchise thrive.
5 Questions You Should Ask
Franchisors about Financing
These simple guidelines can be used to begin an evaluation of an
existing franchise opportunity. These guidelines also represent the
foundation for building a franchise concept from an independent
business. Follow this list to find important questions and
attributes that you should consider when you search for a particular
franchise. When you’re finished, ask yourself if the franchise
program passes the test.
Franchising your Business? Start with a Financial Model
Individuals looking to franchise their business should start the
process by building a realistic financial model. This article
provides a blueprint for franchising a business with an emphasis on
the importance of using a
realistic and conservative
financial model.
The Laws of Franchising Remain Unchanged
In the franchise industry there are certain truisms which have remained
virtually unchanged over the years. I refer to them as The Laws of Franchising.
The following are six of these laws.
How Franchisees Can Use Social Media to Connect With their Local Markets
Home Care: A Franchise Opportunity with a Dynamic Market
The home care industry continues to grow and will continue to
represent a large market segment in the future. Franchise companies
that provide home care to seniors are an excellent opportunity for
franchisees.
Read this article to learn
why.
What the Sale of New Franchises May Reveal About a Franchise Program
8 Warning Signs That Your Franchisor is Having Problems
Franchise companies are not immune to the financial challenges
facing many businesses these days. Since franchisees are dependent
upon their franchisor, it’s important for franchisees to identify
warning signs that their franchisor is having problems.
Find out what these
warning signs are and how to respond.
Why Franchisees Fail
Before you make a decision to purchase a specific franchise, you
should speak with existing franchisees. However, it’s
important to know what questions to ask. Understanding
why
franchisees fail can help you ask the right questions to
help you evaluate the franchise and your chances of success as a
franchisee.
How To Get Your Franchise Start-Up Off To a Fast Start
The faster you start getting customers and sales at your new
franchise, the faster you become profitable. Here are 5 marketing
tips to fast-track sales for your start-up.
How to get sales fast for your new franchise location .
Get To Know The Franchisor Before You Buy The Franchise
When buying a franchise, it’s important to evaluate the
franchisor. This article will present tips on
getting to know the
franchisor before you sign the franchise agreement.
The Importance of the Franchise Territory
When prospective franchisees discuss their franchise territory with the
franchisor, the focus is usually on the size of the territory. However,
there are other important considerations. Here's what you need to know about
franchise territories.
Venture Capital Investment Updates for the First Half of 2010
This article includes results of Venture Capital activity for the first six
months of 2010. Although the majority of investments were made in the technology
sectors increased VC investment represents positive news for business owners and
start-ups. The franchise industry can take comfort from these results knowing
that VC capital is flowing once again. Given the popularity of clean technology
start-ups perhaps a franchise model will be used to grow some of these firms in
the future. Read more >>
Are you thinking about buying a franchise? There's a lot you
need to know before you invest if you want to be successful as a
franchisee. My new manual, 
