When it comes to opening up a franchise, many new franchisees believe it’s going to be a cakewalk. They’re bringing a major well-known brand into a new area. People will start lining up in excitement, right?
Well, no, that’s honestly further from the case. This is only one of the many other common mistakes that franchisees tend to make when opening up a business. But here are seven other common ones.
1. Not Marketing Enough
Even when it comes to a franchise, you’re still going to need to market your business. There are more than enough proven strategies out there to help franchisees. Plus, the businesses (the brand) usually provide marketing material as well. Make sure to utilize this and lean on their experience.
2. Not Learning or Adapting to the Local Culture and Market in the Franchise
The local market and culture are important factors that every franchisee should consider when they are planning to expand their business. A company can impact people’s lives and culture in many ways, such as through advertising, hiring practices, product selection, or customer service. This may include needing to change what is presented in the product. For instance, Mcdonald’s franchisees will alter the menu and ingredients to attract the local market.
3. Not Optimizing Operations for Profit and Growth
Profit and growth are two of the most important metrics for a company. But, it is not always possible to optimize operations for profit and growth at the same time. It isn’t going to magically happen because there is now a major brand in a new area. It will still take a lot of work.
4. Not Hiring Staff That Can Think on Their Feet and Adapt Quickly to Changes in Business Conditions
This is a difficult task as it requires a person with strong leadership skills, experience in dealing with change, and the ability to anticipate future developments. Companies should look for candidates who have worked in similar industries to find these qualities. They should also be able to show that they are not afraid to take risks and make decisions without being told what to do. But the same goes for the franchisee, they need to be familiar with the market and the product as well.
5. Not Delegating, Developing, and Motivating Employees to Maximize Performance
The franchise model is a great business idea but can be difficult to manage. It requires a lot of time and effort on the part of the company to maintain the franchise. Sure, you can look into Franchise Direct for options on what can be franchised, but there is so much more that goes into all of this. In order to maximize performance in the franchise, companies need to develop their staff members. They should not only develop their skillset but also motivate them by providing opportunities for growth and development.
6. Focusing too Much on Operations and not Enough on the Brand for the Franchise
Branding is essential for the success of a franchise. It is not enough to just focus on operations and marketing. You should also focus on developing your brand and ensuring that it is relevant to your target audience.
7. Thinking About What to Sell Instead of Thinking About How to Serve Customers Well
Franchises need to understand what their customers want and how they want it. The best way to serve your customers is by listening to them and understanding their needs, wants, and desires. Sometimes you may have an idea for a new product or service, but ask yourself, “does the brand itself within the franchise even have a reputation for providing that product or service?”
