In the next few weeks, we will be rolling out a series of articles that helps to define some of the key elements of building an F&B business using the franchise model. For the first part of this topic, we will be focusing on explaining how the “people and culture” factors come into play for franchising to be successful. As a follow up to this, we will touch on the systems and structures that support the business in the subsequent week.
One of the key considerations that a business owner needs to note when deciding to set up franchise is the timing. It is important to ensure that the following key areas are checked before getting started in a franchise business:
Are you in 3 years profitable track record?
Is your brand established and solidified?
Are your operations set in place? Has it been refined to ensure that it is running smoothly for past 3 years?
Preparing the foundation for your franchising model will require you to ensure that your brand is strong and impressionable. Having sufficient cash flow for business expansion, building in operations and structure will be essential for the next leap of growth.
Yes, it’s a cliché. We are pretty certain that you have heard this saying before: ”A business partnership is much like a marriage.” This is all too true but yet in many occasions, the common mistake that people make is choosing and evaluating a franchise partnership by financial investment. While finances are important in the evaluation process, there is definitely more to it.
When choosing a partner, one needs to consider:
Is the partner aligned with my vision?
How can the partner help to grow the business?
Are you able to hold clear communications both verbal and written with the partner?
These are important questions to think about as you select your partner. An alignment of vision and strategy of the business will ensure that trust can be built and decisions will be made to achieve and grow the business to its desired state.
Relationship is the foundation of all things
Often overlooked, a solid and strong relationship between a franchisor and franchisee is fundamental to a sustainable and successful franchise.
A parent and children analogy can be used to depict the relationship between a franchisor and franchisee. The DNA of the franchisor’s business is essentially being passed down to the franchisee. This implies that if the franchisor has already developed a strong business system, consistency in quality, tangible brand and support service, the chances of replicating its success for the franchisee is naturally higher. The role of the franchisor is to help the franchisee understand and utilise these structures to their advantage and the best way to achieve this is to build an authentic and strong relationship.
In many instances, franchising is simply looked upon as just a tool for business growth and expansion. Yes, while this may be true, many people do not realise that the success of this business expansion is an outcome of a strong understanding and relationship being built between the partners. To achieve this bond requires deep communications and conversations to perpetually align and build rapport.
For any relationship to grow and flourish, it requires an exchange of trust and a regular flow of information from both parties. Just as a parent would teach and equip his children to grow, his children would also share their experiences and new ideas with him to strengthen the relationship. Being open and receptive in the relationship allows the franchisor to co-develop new ideas and even customise offerings that is specifically catered that franchisee’s market.
Together, through building strong relationships, both parties can build a successful empire of the franchise business is build and it strengthens the overall brand.
Culture is the fuel that gets things moving.
With strong relationships set in place, it lays a foundation for the right culture to be built. Setting a right culture within the business and across the franchises means setting a tone and rhythm to how people interact and how things would operate.
A culture is the silent engine that gets everyone and things moving in an aligned direction and it helps to motivate everyone in moving towards a common goal. Spending effort to invest in building a strong culture helps you to manage your diverse group of franchisees, creating assurance that they share the same understanding with you in making decisions, down to the day-to-day operations.
We hope that our sharing has managed to shed some light on some factors to look out for in building a successful franchise. Stay tuned with us for the second part coming up next week!