Being a Game Changer for the Franchisor
Before we begin this guide, there are a few important points of advice that you should consider before solidifying your partnership. These are qualities and skills that a franchisor will look for, so it is essential that you apply them.
Follow the system
Realize quickly that the system was put in place for a reason, and it's been tried and tested. So don't deviate from it, as it could cost you your franchise. Sticking to the system protects your investment and preserves the brand.
Leadership and team management
This begins by recruiting the right people for the job. Treat your employees with respect, keep them happy to prevent them from leaving. Finding good help is getting more challenging.
The bread and butter of a functional franchise is a repeatable system, which is achieved by continuous training. A committed franchisee would pass on everything they've learned from their franchisor to their employees.
Don't stop marketing
Implementing an effective marketing strategy is how you create awareness and make people value your product in your community. For the most part, this means getting your local advertising and social media marketing right.
Another innovative way of gaining visibility is by engaging your immediate environment through avenues such as festivals, charity events, community sports sponsorships, business shows, and seminars. The general idea is to stay relevant in the mind of your prospective customers.
Maintain communication with franchisees
One of the great things about franchising is taking advantage of the wealth of knowledge and experience of other franchisees. It's essential to maintain a good relationship with other franchisees who can help when things get tough.
The goal is to have three more franchisees you're comfortable enough to contact when you need advice on marketing strategies and employee issues.
Now, let’s begin by going over why a strong and healthy partnership is crucial for a successful future for both the franchisor and franchisee.
Ensuring the Partnership is Right for You
As a franchisee, acquiring a franchise from a franchisor comes with a lot of benefits, but there are also shared risks that both sides need to be aware of.
Therefore, it is essential that franchisees do in-depth research before settling for a particular franchise system. On the other hand, franchisors will accept candidates who would be a perfect fit for the system and contribute to the company's success.
Of course, before you fill out your application, you need to conduct research, and try to understand and learn about the industry you’re in.
Adequate Research on the Franchise
With more than 750,000 franchises in the US, most franchisors would want to know why you've decided to go with their business. This presents you with an opportunity to dazzle them with your knowledge about the company's brand, business model, and the industry in which it operates.
Ways to get useful information on your potential franchisor include:
Getting insights from franchise shows
If you have no experience being part of a franchise, you can demonstrate your understanding of the model by attending industry events.
Events like Franchise Expo West and the IFA Annual Convention bring together sponsors, attendees, exhibitors, and expert speakers for education, information sharing, business development, and of course, an opportunity to have fun.
Visit the brand’s website
Visiting the website of the franchise you're interested in will provide you with information such as the requirements, policies, and prices associated with the franchise. Some franchise websites will even give you insights into basic sales information and help you prepare and plan for your application.
Research the industry and competitors
Understanding how well your desired franchise is doing in the industry and against direct and indirect competitors will put you in a better position to discuss business strategies and ways you’ll contribute.
Experience in the Industry You’re Interested In
Whether it's running a rental center, catering, or an auto workshop, experience is always a big bonus. Although any trade or business can be mastered over time, combining industry-specific knowledge with the backing of a sound franchise system can be a recipe for success.
Potential franchisees should be able to convince the franchisor of their managerial and leadership ability. If you're lacking in any of these skill sets, it is advisable that you seek out an industry expert to serve as an advisor or manager and help round out your requirements as an eligible candidate.
Getting Ready for the Application
A franchise application is like a loan or job application. Though not all franchise applications are the same, the primary objective is to obtain factual information about you as a potential franchisee. One vital aspect of the application is the financial section.
The financial assessment will help the franchisor determine whether you meet their financial criteria or not.
Here are some of the details you can expect to find in a typical franchise application form:
Detailed personal information: this would contain all contact information plus personal history.
Business interest: you might be required to provide information about any business partners, if you have ever managed a business, and any previous legal arbitrations/litigations.
Location preferences: will contain the region and area you're interested in and if you're willing to relocate.
Employment history and educational background: will contain places you've worked, in what capacity, the duration, and annual earnings.
Personal financial statement: this will contain information about your source of income, total income, net worth, assets, and liabilities.
Like job interviews, it's necessary to update your CV when preparing for a franchise interview. You're going to want your CV to highlight some of your experience and skills that best demonstrate why you're best suited for the role of a franchise.
Additionally, you'd need to review your social media presence. Make sure your social media platforms such as Facebook, Twitter, and LinkedIn reflect your professional endeavors, such as awards and seminars you recently attended.
Franchisors sometimes use social media as a form of background check, so be sure to take care of any compromising content you might have uploaded that shows you in a less professional light.
When going for the interview, ensure you're appropriately dressed. Most franchisors have a brand to protect. Since you'd be representing them when you become their franchisee, they'll be more likely to take you seriously if your general vibe is professional and put together.
During the interview, try your possible best to exude commitment. Most franchisors already know the amount of work and working hours it takes to make a franchise successful.
So, they'll be looking for candidates who can go the long haul. Let the franchisor know you're no stranger to hard work and cite examples of instances you've been committed to achieving your goals despite adversities.
Application Process for Some Top US Franchises
The franchise application process for McDonald's
- The process starts by first filing an application form online. The form will require personal information, educational background, credit history, finances, and criminal history.
- If your application is accepted, you'll be required to take some personality and ability tests to ensure you're best suited for managing a large business.
- After completing the tests, you'd be required to gain working experience at a McDonald's restaurant under supervision. You'll also gain access to existing franchisees to ask questions about running a McDonald's. Then you'll undergo a panel interview to evaluate what you've learned.
- If you've made it thus far, you've earned the right to a one-on-one interview at the nearest McDonald's headquarters. This interview will determine if the McDonald's corporation will be moving forward with your application.
The franchise application process for Dunkin' Donuts
- The process begins by accessing the online application page for domestic franchising.
- The application will require you to decide on a traditional or non-traditional store. Non-traditional stores include distinct venues like airports, casinos, stadiums, universities, etc., with high traffic.
- The application will inquire about your experience and finances. You'll be asked about your liquid assets and total net worth. You'll also be asked to discuss your relevant experiences in the restaurant industry.
- After providing the necessary information, you are to review and submit it. Then your application will be reviewed by the Dunkin Franchise corporation. You'll receive an email after detailing your next steps.
Funding Your Purchase
Since most people can't bear the total cost of owning a franchise on their own, franchisees sort out financial institutions like a credit union or bank. Before seeking out a potential lender, it is advisable to make sure your documents are in order. The lender will consider your debt-to-income ratio, credit history, and expected income.
We offer a guide on small business grants and a guide on loans to buy an existing business you could follow that will inform you on what to expect and help expedite the lending process.
Pursue Your Franchising Endeavor
Most franchisors are picky when choosing who to give rights to their brand. Therefore, it becomes necessary as a potential franchisee to put yourself in the best position to be selected. Following some of the tips discussed earlier will help guide you through the application and selection process.
After scaling through the application process, the next step in your franchising endeavor is to sign a franchise agreement. Remember to go over this with your legal advisor to ensure everything is in order. We’ll go over this in depth in the next guide.
Franchising is an excellent opportunity for those with a strong entrepreneurial spirit. But sometimes, the process of getting started could feel overwhelming. You can contact us if you wish to get more clarity on what's been discussed.