Franchise Validation: Why it’s Important and How to Use it

 

Dialing telephone keypad

I recently spoke to a group of top-performing franchisees at a conference held in Chicago, the focus of which was to help these top performers improve even more.  One of the topics their corporate office wanted me to discuss was the importance of validation – both for prospective and current franchisees.

For Prospects: An Inside Look at a Franchise System

Franchise validation can be an incredibly powerful tool for prospective franchisees, as it provides a deeper look into the brand and allows prospects to make a more informed decision when choosing whether to purchase a particular brand’s franchise.  The first step here is to call existing franchisees to find out what’s really going on in the organization.  Some important questions I suggest to ask include:

  • What should I expect?
  • What should I expect in regards to training/on-going support/marketing/economics?
  • Did the business meet your expectations?  What were those expectations?
  • Knowing what you know now, what are the keys to success in this business?
  • Who are the most successful franchisees in your brand?
  • Would you do it again?

For best results, speak with a wide range of franchisees, including those running large stores, those running small stores, and those at varying levels of success.  After you’ve had 10 or more conversations, you will hopefully begin to see some patterns in the responses you’ve gathered – whether positive or negative.

If after you’ve made your validation calls you’re still interested in the franchise system, you should arrange to shadow a franchise owner for a day.  This experience can be incredibly valuable in determining whether the business is right for you.  Then, if you do decide to purchase a franchise unit, the experience will provide useful context that will make information easier to understand during your training.

It will make you a better Franchisee, and establish strong relationships with those fellow franchisees early.

For Franchisees: Vetting New Business Owners

By taking validation calls from prospective new franchisees, you’ll have a chance to reiterate the core values of your brand to make sure the franchisee understands and shares those values.  You’ll also have an opportunity to educate and test prospects to find out whether the person is the right fit for your franchise system.

When I took validation calls as a franchisee for PostNet, one of the questions I would always ask is, “have you ever owned a business or a franchise before?”

Other questions that can provide a great deal of insight include:

  • Do you know what it’s like to make payroll when you don’t have the cash?
  • Do you know the culture of our organization and does that feel comfortable to you?
  • Do you know what technologies we use? Are you comfortable with that or can you learn it?
  • Do you know what our value proposition is? Do you have passion for the business?

 

Also, if they don’t ask about the keys to success in your organization, offer the information to them.  This is a great way to educate prospects about the skills you feel are required for the job.

Keep in mind that your job is not to sell the franchise, but to ask questions to make sure candidates know what they are doing and what is expected of them.  If a prospect calls who is obviously unprepared for the call, tell them “I don’t think you’re ready for this call” and reschedule the conversation for a later date – once they’ve had a chance to learn more about the system.  Also, don’t hesitate to reschedule calls if you’re simply too busy to talk at the moment.  These calls need to work for your schedule, too.

If prospects respond rudely to your request to reschedule a call, or seem otherwise unfit to join the franchise system, be sure to call corporate staff to share your concerns.  Don’t forget to let them know when a call goes well, too.  By keeping the corporate development office updated on the results of your validation calls, you can help bring the good candidates into the system – and keep the bad ones out.

 

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John Francis is a consultant, strategic advisor and keynote speaker who helps franchise organizations  “see what they don’t see” and achieve their highest levels of success.  In his 25+ year career, John has worked as a franchisee, franchisor, investor and Board Member for brands and organizations such as Cost Cutters, PostNet, Sport Clips, Office Pride and the International Franchise Association (IFA). To learn more about John, visit www.johnwfrancis.com.

Copyright © 2015 by John Francis. All rights reserved