Tag: small business

Getting New Franchisees Off to a Great Start

Posted on by Franchise Strategist

GETTING FRANCHISEES OFF TO A GREAT START…The likelihood of a franchise owner “going rogue” when a company is transparent in its expectations lessens. Franchisees know what is expected of them. 

Getting New Franchisees Off to a Great Start
Prepare them for business ownership through the onboarding and training process.
By Gary Occhiogrosso – Managing Partner of Franchise Growth Solutions, LLC.
Photo by Perry Grone on Unsplash

When training new franchisees, there is a term that is used regularly but has received a lot of criticism “Onboarding” Many Franchisors believe that the “onboarding process” begins once a candidate is awarded the franchise. I coach this process is a different way. At Franchise Growth Solutions we know that the onboarding process begins from the very first interaction the company has with the franchise prospect.

Getting to the Goal

That said, let’s take a step back and first explore the goal of proper onboarding. In my opinion, the main focus is to create value for the brand in the minds eye of the candidate. Without value and respect for the brand, all the training in the world will not produce a franchisee capable of living up to his or her full potential as the operating franchisee.
Although franchisee training is often seen as a means to an end because of how quick paced it is and how much information is packed into training sessions, in and of itself training is certainly not the sole answer in producing quality franchisees. Through the years I’ve trained franchisors to understand that in order to successfully orientate a new franchisee; Mission, Culture and Core Values of the brand must be communicated to and embraced by the franchisee. Here again I cannot emphasize enough that franchisors must start building value and respect for the brand during the recruitment phase. It is during that time, potential franchisees and the franchisor should engage in meaningful, mindful conversation so that the franchise candidate understands what is expected of them and the Franchisor should understand what the franchisee expects in return. It’s a simple (but not easy) process that can lead to rejecting a candidate and losing the deal. However, trust me when I say, losing that candidate is a far better outcome than bringing the wrong franchisee into the system only to wreak havoc, compromise brand standards and lobby additional, otherwise satisfied franchisees into their negative mindset.
Successful onboarding and training requires transparency, consistency and follow up.

The likelihood of a franchise owner “going rogue” when a company is transparent in its expectations lessens. Franchisees know what is expected of them. In addition, the Franchisor’s support personnel should be out in the field in front of the franchise owner, coaching, counseling and working with the franchisee to achieve optimum results, financially as well as making sure the business is providing options consistent with the franchisees lifestyle goals. Supplying ongoing training that places resources within reach of the franchisee is not only vital at the onboarding phase but throughout the lifecycle of the business relationship.

Initial Training & Support

This approach helps franchisees adapt as the brand grows and systems evolve. Preparing franchisees to deal with the issues that may come up along the way is key to building a successful franchise system. Ultimately solid onboarding and training should expose the franchisee to detailed information so the franchisee knows what the company expects and they can live up to the “Brand Mission”. Initial and ongoing training should support the idea that following the system is the most important aspect leading to the success of the business. This approach puts franchisees in a better position to make sound decisions concerning the business with little outside assistance and with little room to “reinvent the wheel”.

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Franchisees need to be held accountable for holding the same high standards as the franchisor. In order to do this, your company culture, value proposition, training program, operations manuals, job aids and other franchisor supplied tools should be carefully develop, tested, reviewed and updated as necessary. The onboarding process and training program is never “done”. As the franchisor it is you job to insure that franchisees have access to the tools and support needed to grow and thrive.
Get new franchisees off to a great start through a sound onboarding process that starts at the first hello. Recruit and vet your candidates thoroughly, be certain they are a fit for you brand culture and buy into your mission statement. Provide them with the tools and support needed to navigate system changes as they occur. Give the franchisees the foundation they need to grow, develop, and succeed as business owners. An excellent franchise system, built this way from the start makes it easier for franchisees to overcome challenging situations as they occur, and they will occur.
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About the Author:
Gary Occhiogrosso is the Managing Partner of Franchise Growth Solutions, which is a co-operative based franchise development and sales firm. http://www.frangrow.com
Their “Coach, Mentor & Grow Program” focuses on helping Franchisors with their franchise development, strategic planning, advertising, selling franchises and guiding franchisors in raising growth capital.
Gary started his career in franchising as a franchisee of Dunkin Donuts before launching the Ranch *1 Franchise program with it’s founders. He is the former President of TRUFOODS, LLC a 100+ unit, multi brand franchisor and former COO of Desert Moon Fresh Mexican Grille. He advises several emerging and growth brands in the franchise industry
Gary was selected as “Top 25 Fast Casual Restaurant Executive in the USA” by Fast Casual Magazine and named “Top 50 CXO’s” by SmartCEO Magazine. In addition Gary is an adjunct instructor at New York University teaching Restaurant Concept & Business Development as well Entrepreneurship. He has published numerous articles on the topics of Franchising, Entrepreneurship, Sales and Marketing. He is also the host of the “Small Business & Franchise Show” broadcast in New York City and the founder of http://www.FranchiseMoneyMaker.com

MAIN STREET – TRAFFIC AND SALES TRENDS

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WHAT’S HAPPENING ON MAIN STREET ?? – TRAFFIC AND SALES TRENDS
By Roger Lipton
Photo by Nadine Shaabana on Unsplash

There is not much to celebrate among restaurant industry operators. “Flat” is better than “Down”, but sales and traffic trends continued to be lackluster in April, and there is no reason to expect a change in May (now history) or the month to come. We have described many times how the dining industry has been an excellent leading indicator relative to the economy. We suspected earlier this year, as our readers know, that the lack of momentum in the restaurant industry indicated that the economy was unlikely to break out on the upside. That has proven to be the case as the slowdown in the economy is clearer by the day. The latest GDP expectations for the second quarter are in the 1.25-1.5% range, a lot lower than the 3.2% of the first quarter, and bringing the first half very close to the 2.3% of the Obama years.

While some worse numbers than shown below have circulated, we quote below the Miller Pulse survey numbers.

Back in restaurant land: Continued weak traffic was the feature in April, with higher check values (up 4.1%) overcoming a 2.1% traffic decline and bringing same store sales to a 2.1% increase. As we have said repeatedly, that is not enough to overcome higher labor, rents, and other operating expenses, so margins will continue to be challenged. The two year stacked comp is up 3.8% in April, down 10 bp from March.

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By segment:

Quick service restaurants were up 2.7% in April, with 4.6% check average overcoming 1.9% traffic decline. Over two years, QSR SSS fell 30bp month to month to 4.3% so not much has changed.

Casual dining did worse, with same store sales down 0.5% in April even with a boost from the Easter calendar shift, and traffic was down 2.8%. Over two years, SSS was up 60 bp to a lackluster 1.3%, with traffic obviously down.

We have heard no credible reports that trends have improved in May so, with two thirds of the second quarter in the rear view mirror, and the economy showing signs of slowdown, there seems little reason to think that operating results will improve in Q2. A pickup could be in the cards, and the restaurant industry could lead the way, but not yet.

Read more from Roger Lipton here:
https://www.liptonfinancialservices.com/“>https://www.liptonfinancialservices.com/
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About the Author:

Roger Lipton is an investment professional with over 4 decades of experience specializing in chain restaurants and retailers, as well as macro-economic and monetary developments. After earning a BSME from R.P.I. and MBA from Harvard, and working as an auditor with Price, Waterhouse, he began following the restaurant industry as well as the gold mining industry. While he originally followed companies such as Church’s Fried Chicken, Morrison’s Cafeterias and others, over the years he invested in companies such as Panera Bread and shorted companies such as Boston Chicken (as described in Chain Leader Magazine to the left)

He also invested in gold mining stocks and studied the work of Harry Browne, the world famous author and economist, who predicted the 2000% move in the price of gold in the 1970s. In this regard, Roger has republished the world famous first book of Harry Browne, and offers it free with each subscription to this website.
Roger Lipton https://www.liptonfinancialservices.com/

PRESS RELEASE – Franchise Growth Solutions Exhibits Innovative Franchise Brands.

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COME OUT TO THE INTERNATIONAL FRANCHISE SHOW…Franchise Growth Solutions Expands Internationally as Exhibitor and Speaker at The International Franchise Expo May 30 to June 01, 2019 at New York’s Javits Center

“We’ll be showcasing some of the most innovative and exciting franchise brands of the year.” Gary Occhiogrosso – Founder, Franchise Growth Solutions, LLC.
NEW YORK MAY 27, 2019

Franchise Growth Solutions LLC, the New York-based strategic planning, franchise development and sales organization, headed by franchise industry expert, Gary Occhiogrosso, will exhibit at the International Franchise Expo, May 30 – June 01, 2019, at the Jacob K. Javits Convention Center in New York City.

Mr. Occhiogrosso, a 30-year veteran of single and multi-unit franchise development and sales, was instrumental in the launch and growth of nationally recognized franchises including Ranch *1, Desert Moon Fresh Mexican Grille, and brands found under the 100+ unit multi-brand franchisor, TRUFOODS, LLC.

From booth #646, Franchise Growth Solutions will showcase some of 2019’s hottest franchise opportunities: Acai Express®, Riko’s® Thin Crust Pizza, Balloon Kings®, and MATTO Espresso® to an estimated 20,000 entrepreneurs and future business owners. Occhiogrosso revealed, “We’ll be showcasing some of the most innovative and exciting franchise brands of the year.”
With additional credentials as an in demand public speaker on franchise success, and as an adjunct instructor at NYU, and Contributor to Forbes.

Occhiogrosso will also moderate two panel discussions entitled. At the first discussion “ Private Equity and Franchising” scheduled for Thursday May 30th at 10am, Occhiogrosso will host a discussion between franchisors and private equity investment professionals on how to find capital, the best ways to position franchises for growth/investment, and a checklist of what is required for strategic partnership in the eyes of the investment community. “This is my favorite venue to present this panel, we bring together Emerging Brands and Private Equity Investors to discuss ways to capitalize on the fired-up equity markets in Franchising,” added Occhiogrosso. The second event titled “Using Your Digital to Sell Franchises” is scheduled for Thursday May 30th at 4pm and will cover how Franchisors can maximize their franchise solicitation by tapping into the vast array of tools now available in the digital world. Occhiogrosso said “This panel will feature experts in the Internet marketing industry who will share tips and best practices designed to create accelerated lead generation for their franchise sales effort.” The events are free as part of the attendance fee for the Franchise Expo.

The International Franchise Expo in New York City is the largest franchise show of its kind in the country. The three-day show traditionally attracts over 20,000 attendees and over 400 national and international franchise opportunities.
ABOUT FRANCHISE GROWTH SOLUTIONS, LLC

Franchise Growth Solutions, LLC is a strategic planning, franchise development and sales organization offering franchise sales, digital advertising, brand development, strategic planning, real estate selection, architectural development, vendor management, lead generation, and PR including social media. Franchise Growth Solutions’ proven “Coach, Mentor & Grow®” system puts both franchisors and potential franchisees on the fast track to growth. Membership in Franchise Growth Solutions’ client portfolio is by recommendation only.

For information on Franchise Growth Solutions or any of its franchise opportunities, please contact Gary Occhiogrosso at (917) 991-2465 OR email at [email protected]

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6 Tips When Buying A Franchise

Posted on by Franchise Strategist

Starting a business can be a life-altering event both good and sometimes not so good. One of the ways people reduce their risk is to purchase an established brand with a proven business model – a franchise.

Franchising has proved over and over again to give a new business owner the highest probability of success. If you follow the system, choose an experienced franchisor, work diligently, are appropriately funded and understand what you’re getting into then operating a franchise may be a perfect business model for you.

Selecting a franchise and purchasing a franchise combines gut reaction with solid research. Although there are many steps to buying a franchise here are my Top 6 Tips that will keep you moving forward in the process. I recommend never skipping or overlooking any of them.

Tip #1 – Begin With Some Soul Searching
Make a written list of what you believe you’re looking for in a business opportunity. However, for this exercise, you cannot put the words “make money” on your written list. The reason for that is simple. I want you to look inward at your dreams, background, hobbies, likes, dislikes, skills, social and community positions and all the elements that a business would need to deliver to you, despite the money. I know many franchisees and entrepreneurs that dread getting up every day to work their business even though are making all sorts of money. Franchisees that are great at selling or corporate engagement should seek a franchise that puts them in front of customers in a corporate environment, perhaps in the advertising business or financial business. Entrepreneurs that like to craft things or work outside or work with their hands should never seek out opportunities that land them behind a desk or stuck in a shop 12 hours a day. Although ultimately in time you will not be doing the “work of business” keep in mind that in the startup phase you may need to. Moreover, if you don’t like the work or have neither the time, desire or inclination to develop new skills you may never get to the next level in developing your business. If you can’t “see yourself” doing a particular type of work, then walk away, no matter how much money you think you’ll make. Look in the mirror and be honest when you sit down to write your list.

Tip #2 – How Much Available Capital Do I have?
Numerous business reports cite the number one reason a small business fails is that proper thought and consideration wasn’t given to the appropriate capital required to open and sustain the start-up of a small business. A lack of adequate money can destroy you before you even begin. It is crucial that you understand the numbers. Before you start your quest for a franchise, you should access your available liquid capital, your borrowing ability and the net worth necessary to collateralize a business loan. Also, there are various ways to finance your new business. That includes your savings, investments or loans from friends and family, bank loans, SBA loans and using the funds in your 401K to finance the new venture. Once you know the number, you can go shopping, or you may decide you don’t have enough money now and need to create a plan to accumulate the appropriate amount of start-up capital. Your accountant may be able to help you access your investment ability. Keep in mind many accountants (and lawyers) are not entrepreneurial minded or risk takers. Some will attempt to “protect you” by trying to convince you not to go into business. Remember you’re assessing your investing capability not looking for permission. That said, knowing how much you can invest will save you and the franchisor time. In addition, it’ll place you in a better position to succeed.

Tip #3 – Meet The “Parents”
In this case, the Franchisor. Once you’ve selected the type of industry you’d like to be in, its’ now time to search for a company that meets the criteria on the list we discussed earlier in this article. There are many ways to seek out opportunities, Franchise Trade Shows, Websites, Franchise Business Brokers and others. I’ll cover that in a subsequent article. Once you reach out to a franchisor, a franchise sales representative will most likely contact you. At this point be prepared to answer some questions over the phone. You may also be asked to fill out an application before going any further in the process. Many reputable franchisors will not engage in any serious conversation with a candidate without an application. My experience has been that franchisors willing to forgo written applications or skip asking qualifying questions at the start of the process may be desperate to “sell” a franchise. That should be a red flag for you. Beware, because it may be a sign the franchisor is undercapitalized and/or more interested in selling franchises and collecting licensing fees instead of supporting the franchisees long term by focusing on royalties from successful franchised locations.

Tip #4 – Take A Good Hard Look At All The Documentation
Once you fill out the application, the franchisor will most likely interview you over the phone or in person and then is required to issue you a Franchise Disclosure Document (FDD). Depending on the State where you live, you must have the FDD between 10 and 14 days before you can enter into any agreement or hand over any money to the franchisor. You will be asked to sign a receipt that you received the FDD and indicate the date you received it. This disclosure document has all the required information that the Federal Trade Commission (FTC) and various States require the franchisor to tell you. Please read it and reread it. Have a franchise attorney review the document and offer legal counsel regarding the franchise agreement. Then follow up with the franchisor. I would recommend that if you’re interested in moving forward, it’s now time to meet the franchisor in person (if you haven’t already) by scheduling a Discovery Day. Make a list of questions and spend the day to meet the team and get answers as well as a feel for the culture of the organization. Find out how deep the franchisor’s organization is and, please make sure you feel comfortable that the franchisor has enough experienced staff to service the franchisees.

Tip #5 – Speak With The Franchisees
Your best source of information is going to come from the franchisors customers, that means the franchisees. Call and visit as many franchisees as possible. Since many Franchisors don’t disclose Average Unit Sales and Operating Expenses in their FDD, they can not discuss it with you. Franchisors can only make claims and address financial issues published in their FDD. Be wary of the sales rep that starts telling you how much money the franchisees are making and how much money you can make. This practice of making “earning claims” not documented in the FDD is not only a violation of franchise regulation but also another red flag. However franchisees are not bound by franchise regulation and if they choose, are free to answer any question as long as they do not disclose proprietary information belonging to the franchisor, such as recipes or processes. When visiting the franchisees, build a report, let them know you’re close to making a decision and carefully phrase your questions so that they are not intrusive. I always ask about support and if they had the opportunity to “do it all over again” would they? Keep in mind there will always be a few disgruntled or struggling franchisees. Without knowing all the facts, it’s tough to condemn the system or franchisor. That said, if the majority of franchisees regret their decision or feel that the franchisor is not supportive, then you need to make further inquiries with the franchisor before signing the franchise agreement.

Tip #6 – Ready, Set, Go
Not so fast. Before the franchisor prepares a franchise agreement is it essential to discuss the best way to structure your new company. Many attornies will recommend that you not sign the franchise agreement in your name but instead set up a separate business entity such as a Limited Liability Company (LLC) or an S-Corp. Seek competent legal advice from a franchise attorney before you sign a franchise agreement or set up a new company.

Franchise ownership can provide you and your family a lifestyle that can not be achieved by working a job for a company. Building a business can be rewarding, exciting and stressful all at the same time. As an entrepreneur, I believe business ownership is the best form of work for many people.

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Photo by rawpixel on Unsplash

About the Author
Gary Occhiogrosso is the Founder of Franchise Growth Solutions, which is a co-operative based franchise development and sales firm. Their “Coach, Mentor & Grow Program” focuses on helping Franchisors with their franchise development, strategic planning, advertising, selling franchises and guiding franchisors in raising growth capital. Gary started his career in franchising as a franchisee of Dunkin Donuts before launching the Ranch *1 Franchise program with its founders. He is the former President of TRUFOODS, LLC a multi-brand franchisor and former COO of Desert Moon Fresh Mexican Grille. He advises several emerging and growth brands in the franchise industry. Gary was selected as “Top 25 Fast Casual Restaurant Executive in the USA” by Fast Casual Magazine and named “Top 50 CXO’s” by SmartCEO Magazine. In addition, Gary is an adjunct instructor at New York University on the topics of Restaurant Concept & Business Development as well Entrepreneurship. He has published numerous articles on the topics of Franchising, Entrepreneurship, Sales, and Marketing. He was also the host of the “Small Business & Franchise Show” broadcast over AM970 in New York City and the founder of FranchiseMoneyMaker.com