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The Entrepreneurial Franchisee May Not Make the Best Franchisee

by Ed Teixeira

 It's been my experience that some so called entrepreneurs don't always make the best franchisees.

By its very nature, franchising can offer a person a proven and successful business model with training, a recognized brand name and operational and marketing programs. In many systems the franchisor provides oversight and support for the franchisee operation. Despite the advantages that a franchise can provide the new business owner, there are certain individuals that don't make the best fit as a franchisee and it has nothing to do with their business acumen or financial resources. These types may be better suited to be an independent business owner or to run a large multi-unit franchise.

During my franchise career I've encountered franchisees who at first glance presented strong qualifications for becoming a franchisee. They fit the profile we established and impressed franchisor staff, yet some were not up to the challenge. Certain highly qualified candidates, who fit the dynamic entrepreneur mold, may not be the best fit as a franchisee. I refer to them as entrepreneurial franchisees. This doesn't mean that they will fail but rather they may not maximize their results. The reason is that these entrepreneurs may have their own ideas about how a business should be operated and marketed and this can carry over to how they manage a franchise. Some of the advantages that a franchise offers can frustrate some entrepreneurial franchisees because of their specificity.

  • A structured system that represents the very foundation of a franchise operation can frustrate those who resent the rigidity of franchising.
  • Franchise systems may invite suggestions from its franchisees; however, some entrepreneurial franchisees tend to be more creative and may lose patience by not being heard or having their suggestions accepted.
  • Franchisor staff charged with the responsibility to support and assist these franchisees may be perceived as being under qualified by the franchisee.
  • Marketing and advertising restrictions that require a franchisee to restrict these activities to a specific territory can frustrate the entrepreneurial franchisee who takes an aggressive sales approach.
  • These franchisees may stray from the franchise system, from time to time, as their aggressiveness comes into play.

There are certain individuals I would classify as entrepreneurial franchisees. They are rather strong willed confident business people with a creative side to operating a business. Franchisors that have this type of person as a franchisee may find that both parties may become frustrated by the constraints of a franchise model. It can be difficult to identify the entrepreneurial franchisee. Franchisors should be careful when dealing with highly confident franchise candidates that conduct themselves like an entrepreneur rather than a compliant franchisee.

2015 FranchiseKnowHow, LLC

Ed Teixeira is the President of FranchiseKnowHow.com and Chief Operating Officer, FranchiseGrade.com. He is a former franchise executive and franchisee. He can be contacted at 631-246-5782 or at  franchiseknowhow@gmail.com



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