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Lead Generation, Franchise Sales and Reality

Posted on March 9, 2020April 9, 2020 by Franchise Strategist

This approach is terrible not only because you have empty spots in your pipeline but also because an ebb and flow in the advertising plan sometimes may cause the “brand” to disappear for awhile and send the franchise buyers a less than confidence inspired massage. For a start-up or emerging brand, this is the equivalent of a jet airliner “pumping the brakes” to save fuel while attempting to “take off.” It usually leaves a mess at the end of the runway.

Lead Generation, Franchise Sales and Reality
By Gary Occhiogrosso – Managing Partner – Franchise Growth Solutions, LLC.
Photo by Kees Streefkerk on Unsplash

The best way to get results in franchise lead generation is to remember that NOTHING works a lot, but everything works a little. What does that mean? It means for a start-up or an emerging brand (under 50 units), you need to try various lead sources to test which “streams” bring in the type of leads at the rate necessary to make your sales plan.

Look at all the factors in the game
Cost Per Lead and Cost Per Acquisition are only two KPI’s to look at when monitoring your program and its results. It is not as straightforward or revealing to limit your decision based on “how much did I spend and how many units did I sell.” The Reality is; it takes numerous elements to gain success. Such as time to build your pipeline (5-8 months), consistent follow up by a competent, highly trained, and relentless sales staff. As well as accepting the reality of the selling cycle
(about 120 to 180 days) and a realistic lead generation budget to pursue a professional and sustainable franchising recruiting effort. Your brand will NOT “sell itself.”

The Reality is that consistency in lead flow is also essential. I have seen many start-ups and emerging brands take a hiccup approach to franchise lead generation. This approach is terrible not only because you have empty spots in your pipeline but also because an ebb and flow in the advertising plan sometimes may cause the “brand” to disappear for a while and send the franchise buyers a less than confidence inspired massage. For a start-up or emerging brand, this is the equivalent of a jet airliner “pumping the brakes” to save fuel while attempting to “take off.” It usually leaves a mess at the end of the runway.

Royalties will make you the King or Queen
For me, the most important thing for a start-up or emerging brand to remember is the “value” of your franchisee over the lifetime of the franchise agreement. The Reality is; if you calculate the royalty return over that period, you will see the real reward of consistent lead generation and awarding a franchise. Calculate your Royalties on your AUV’s by the number of years you expect your franchisee to be in business, and it’s obvious. Do the math. Keep that in mind, and you won’t think the “Cost Per Acquisition” is too high unless you are attempting to “fund” your new franchise company from the upfront franchise fee collected. Funding your growth solely with the Initial Franchise Fees is never a good idea.

You should be in the franchising business for the royalties and the eventual exit, not the franchise fee. News Flash, focusing on the collection of Franchise Fees doesn’t work and often puts not only the franchisor in jeopardy of failure but also the franchisee. When you focus on the franchisee’s success, you will build a better organization, better equipped to support your franchisee. Successful franchisees paying long term, residual income from ROYALTIES is the way to BUILD YOUR BUSINESS.

A bigger “kiss” at the end
The Reality is; the sale of franchise companies (especially to Private Equity firms) have proven time and time again, that multiples paid on Royalty driven EBITDA at exit are more significant than the multiple typically offered on EBITDA derived from company operations. That’s because it’s scalable at a faster pace and with a lower cost.

Building a franchise business as a Franchisor requires a great concept, a comprehensive system, manuals and training, proven results, capital, planning and patience. If you remove any one of these components the journey may be an endless winding road with no clear direction.Talk to us to get started.

For more information, visit our YouTube channel and watch the videos titled:
“Using Digital to Sell More Franchises.”
“Private Equity and Franchising.”
https://www.youtube.com/channel/UCy6HZTtVYfsO9o8fBFMnZww

Leads – A Never Ending Challenge For All Companies

Posted on December 14, 2019January 13, 2020 by Franchise Strategist

Photo by Berkeley Communications on Unsplash

He explained that through his experience and the help of a little sonar gadget on his boat, that he knew there was a shoal of fish below. We all slung our rods over the side and dropped our lines.

Fishing for Leads – The 5 Steps
By: Peter Lawless

The first thing that I noticed when I got onto the small boat at the harbour in Enniscrone, Co. Sligo, was the cleanliness and order of the boat. The skipper in charge had all of the rods, upright, with their lines neatly tucked away, in holders. The holders were made out of piping, about 30cm long, which had been welded to the side of the boat.

A simple, inexpensive aid had made me sit up and pay attention. This skipper thought about his customers, and this device left a strong impression. We then got a very short lecture on safety, checked we had our life jackets on, and off we went. About 12 of us!

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Finding your target market
About 12 minutes later, the skipper stopped the boat, and told us we should find some mackerel here. He explained that the lures on the hooks looked just like what mackerel wanted to eat. It certainly was not something I would have fancied!

He explained that through his experience and the help of a little sonar gadget on his boat, that he knew there was a shoal of fish below. We all slung our rods over the side and dropped our lines.

Reeling in the sale
Now I don’t know about you, but this was totally new to me. I wound up the line frantically, as soon as I felt a tug, and hey presto, there were three fish dangling off the hooks. I started flailing about, one jumped off before I even got it in over the side, and when I was trying to reel it in the final bit I lost another one. The one that I got in, I lost down the gutter when I finally got it off the hook.

The skipper explained to me, that once a fish took the bait, I should give a quick tug on the rod, to make sure it was firmly hooked. I should then take my time, to reel it in. Secure the rod in the holder, with the fish hanging over the bucket and deal with them one by one – I did, and I ended up with 20 fish, which delighted me, as I had set a target of 10, since my friend had caught 9 on his first time

So what are the lessons for marketing – if you are still with me, and have not already got most of them, here they are in business speak;
1. Set goals and targets that are realistic, and based on some valid foundation or research.
2. Have simple procedures set up, to make it easy to operate and for your customers to conduct business with you.
3. Speak in your prospects language, about what they want – it’s a bit like the fish bait, unlikely that strawberries and cream will catch many mackerel!
4. Once you know what your prospects like, find out where they are, do some research and target them accordingly – as in our example, not much point in putting down shark bait in a shoal of mackerel.
5. Once you get your customers attention or have a lead, qualify it, and ensure you follow up at all time to close the sale. Again the use of a good sales process is essential here.

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The bottom line, if you know what problems or desires your customers have, and you can solve or fulfill these, while providing value for money, you will always be a winner.

And if you don’t know the answer to that question, go ask the people who have already bought from you – they do!

Author Bio
Business Owners who need more sales and better marketing advice, turn to Peter Lawless, of 3R Sales & Marketing. For previous articles and interviews like this, visit our website and subscribe to Success. We also provide free Sales & Marketing Assessments for Business Owners with an Irish Connection.

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