Despite industry challenges like Inflation and the Labor Shortage, 2022 appears to be a year of Franchise Growth. The shutdown during the pandemic forced many people to rethink their career paths, many opting to take control of their career through entrepreneurship. Buying a Franchise provides a time tested and proven business model and eliminates the effort of building a brand from scratch. The challenges of the past year have also improved the relationships with Franchisors and Franchisees as they overcame hardships together. This means as a Franchisor, now is the perfect time to think about selling your franchise.
In fact, the International Franchise Association published a report stating that franchise brands, “drive 1.8 times higher sales than comparable non-franchise establishments.” If you’re selling your franchise this year, here are a few tips to get started.
Looking for the fastest way to grow? Read our blog: Why Outsourcing is the Key to Growth for Multi-Unit Companies.
Selling Your Franchise: Build a Franchise Development Team
Selling your franchise is a 6-8 week process. You might begin by being the sole person selling your franchise, but you’ll eventually want to build a Franchise Development Team. An expert team who knows and understands your brand can focus on selling your franchise, so that you can focus on other priorities. As you begin to acquire additional locations, you’ll have the capital to think about building your own Franchise Development Team, or hiring an outside consulting firm to work with you.
Selling Your Franchise: Know Your Ideal Buyer
The success of your franchise goes far beyond selling your franchise. Your franchisee has to be successful. You’ll want to award the right person the opportunity to buy your franchise. You’ll need to have certain steps in place during the buying process to ensure you’re working with an individual who meets your requirements for an ideal franchisee. Do they follow the instructions you’ve provided? Are they engaged with you, your content, and your processes? Pay attention to the behavior of your buyer. The franchisee-franchisor agreement is a long-term relationship, and you want to ensure you’re choosing buyers who are the right fit for you and your brand.
Selling Your Franchise: Educate Your Buyer
Understand that when a buyer reaches out, they’ve already done the research and feel they have a strong understanding of your brand. Therefore, you need to be educating potential buyers long before that first contact is made. Tell your brand story across as many channels as possible, and educate your potential buyers along the way. What is the value of your product? What is your mission, vision, and purpose? What about the reason behind the investment costs and the potential ROI? Answer these questions for your potential buyers before they ask, and give them the tools to discern whether or not they’re ready to buy. Selling your franchise is easier when you give your buyers the knowledge they need to make confident buying decisions.
Selling Your Franchise: Leverage Unit Economics
Nothing sells a product or service better than a great success story. Who is your buyer going to be when they purchase your franchise? What is the benefit? Make sure your franchisees are making money and achieving success. Leverage your successful franchisees and their stories in your sales process. Hearing from someone who is living your brand will make your buyers want to buy, creating demand among prospective buyers.
If you do have franchisees who are struggling, take a look at why you agreed to award them the opportunity in the first place. Is there something about the location that has been overlooked? Offer additional support and learn where there are areas that need improved.
The franchise industry is gaining strength as more entrepreneurs are looking to invest in buying franchises. Many franchisors who have optimized processes and build expert, efficient operations and leadership teams are in the perfect position for significant growth over the next 12 months.