Know about the biggest challenge in franchising
Hi, Iyyappan Rajendran, Founder of Strategizer, here. I have been talking to many aspiring franchisors over the years, and the many challenges that franchisors face can be insurmountable to most business owners. Believe me, there is no rule that decides whether a brand is franchisable or not? Surprising, isn’t? Even more surprising is the number of startups that are able to transform their business into a franchise model, even during the pandemic. This speaks a lot about the nature of today’s startups in making big decisions. But to me there are three primary factors that enable them to talk to potential investors or franchisees and create their franchise business expansion opportunities. That is why I always emphasize the three 3-C’s formula in franchising:
Now if you ask me again the single biggest challenge in creating a franchising model. Let me tell you that if you fail in any of the three ingredients of the 3-C’s formula in franchising, the chances of establishing a franchise network are invariably low. And remember the success rate of any aspiring franchisor is the ability to establish a trusted franchisor network. If that’s an issue, then the franchisor can be assured of failure some time or the other. Also, I consider this failure on the part of the franchisor’s inability to stick to the 3-C’s franchising formula. If you’re looking for the best franchisee business consultant in Chennai, then don’t go any further than Strategizer. We provide you with the perfect franchise business opportunities in Chennai and Tamilnadu for your business success.
What do I mean by clarity here? It is not about how much franchisors know about their business potential, but about solving customer’s problems at large, and how fast and effective they’re in that. I also feel that it is also not about why a business needs to solve a problem, but about ‘how’. Yes, for a franchisor the ‘how’ is more important than the ‘why’. Now imagine every business in a specific niche or category looking to solve a particular problem. It would simply boil down only to the ‘why’ point at the end of the day. Some of the biggest franchisor brands were able to make rapid strides in the franchise system because of their ‘how’ factor. It Is their constant pursuit of how to get ’better’ at franchising their products or services that has helped multiply their business potential and furthermore catalyze their success rate. It is my opinion that the clarity of the franchisor in solving business pain points can lead to better franchising opportunities anytime.
The ‘control’ of a brand franchisor can be effectively defined as its ability to establish control over its franchisees. Examples of a few control aspects include branding credentials like trademarks, trade names, domains, transferrable management and training and operational procedures, etc. These controls mold the franchise business model into a proven system of management and operation. But what if the franchisor brand fails to exercise control over its franchisees? It could fail big time in expanding its franchise network–in other words, its revenue base and increased brand visibility of products or services. Therefore, it is important for any brand looking to establish a franchising system to first exert its control over its franchise network.
Communication of a franchisor can be defined as properly propagating the values, vision & mission, processes and procedures in all departments to the franchisee(s). Interrupted or broken communication can result in the franchisor brand failing to motivate or support its franchise network to the next level possible. For instance, if there’s a lack of effective guidance–like implementing best practices or specially crafted message in protecting the interests and security of franchise owners and employees–the franchisor can lead to feelings of ambiguity and inaccessibility on the part of the franchisee(s). To sum up, there should be effective to-and-fro communication between the franchisor and franchisee at every possible link along the value chain.