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A larger and more motivated pool of franchise candidates requires franchisors to evaluate their sales practices.
A year ago, you could barely open a news source without seeing headlines of workers losing their jobs in record numbers. But today, the headlines have changed. People are not returning to plentiful jobs in the hopes of finding something better, even as enhanced unemployment benefits begin to dry up. For franchise sales, this means a larger and more motivated pool of franchise candidates than has been seen in years. No, this is not going to be an article about how easy franchise sales are right now. In fact, franchise sales have always been and will always be a complicated mutual courtship.
While the foundational principles of franchise sales remain, as do franchise sales best practices, today’s buyer brings the unique history of the past year and half to the conversation. As with all sales, it is important to be able to anticipate the thoughts and questions of these prospective buyers.
As we look back at the last tragic year, we can presume your post-pandemic franchise buyers have been doing the same thing. Many will conclude they no longer want to be beholden to a corporate boss. They want to do what they love, control their own destiny, build something and enjoy the independence of being an owner. In short, many are looking for a fresh start.
Also keep in mind that for many buyers, their narrow list of concepts for consideration is very emotionally driven. So it’s important that your messaging connects with the buyer on more than a logical level. It must touch them where they live and breathe.
The “what ifs” in the franchise sales process have grown exponentially. What if the pandemic and new variations of Covid-19 continue to linger? How will I even open my business let alone thrive? What if I open and I cannot find any workers? What if the new economy is different than pre-Covid?
You must be able to address these fears without over-promising.
While they may not necessarily have franchising expertise, this newer group of franchise candidates includes many coming from skilled management and technology backgrounds. Your franchise strategy, operations, marketing and support must be able to withstand evaluation by this sophisticated group. Perhaps a post-pandemic audit to ensure your program is optimized for today’s marketplace is in order. Evaluate if your operations manual needs an update given operational changes brought on by the pandemic. Be sure that your marketing materials are in line with the way today’s buyer does his or her research and communicates. Assess whether your support functions answer the unique challenges of a business owner in the post-pandemic world. Determine if adjustments need to be made in sales and compliance procedures.
Franchisors will need to be able to demonstrate their response to recent challenges and instill confidence that system operations and adjustments worked. Show how the business pivoted and refined itself as needed — and how it can continue to do so in the future. This is done in person through the sales process and is supported by your online presence (showing busy operations and grand openings on social media perhaps). The messaging in recruitment materials may need to discuss the difficulties encountered and your response to instill confidence in franchise candidates and their advisors. If yours was an “essential business,” your messaging should highlight this as well.
And remember, this is the time when a franchisor who has been actively engaged with and supportive of its franchisees during both the best and the worst of times can rely on those franchisees to help further validate the concept to potential new buyers.
Financial Performance Representations can be a great sales tool, but they are not necessary. It will be understandable if 2020 numbers look somewhat unusual, but most franchise performance representations report back several years. For franchisors who want to use them in the sales process to help inform their prospects, they will have to work with their attorneys and franchise advisors to present an accurate picture and stay within legal guidelines.
But remember, the impact of 2020 will not be lost on your candidates. If you were closed for some significant portion of the year and had limited operations during other times, you can certainly bring that to the prospect’s attention as long as you have disclosed it properly.
One of the important “sales” in the franchise process is selling the concept of franchising itself. The franchisor, through its sales team, may need to educate the candidate on the advantages (and yes, as part of your qualification process, the disadvantages) of franchising.
In addition to the franchisor’s survival and even growth during such difficult times, there are other benefits candidates might not immediately realize. For example, the franchisor can point to the good relationships it had with system vendors who were willing to accommodate the needs of the franchise system as it adjusted and the discounts on pricing that it realized. Point to the necessary sanitation practices that are detailed in your operations manuals so prospects can see they would not have been starting from scratch in this newly important area. Point also to the way the franchise industry, through the International Franchise Association, for example, went into overdrive to assist franchisors, franchisees and suppliers through its government relations efforts, member sharing and overall support.
The ability to effectively sell and award franchises is critical to the success of any franchise program. Franchisors and their sales teams need to be prepared for the post-Covid buyer mentality. This starts with an honest assessment of the franchise offering and the systems behind it, as perceived by these buyers, and an evaluation and action plan to ensure that the right messaging and tools are in place to attract, convince and then support those buyers at every stage in the franchise sales and onboarding process. Today’s thriving franchise sales marketplace, while ripe with opportunity, should also serve as a time of assessment and adjustment for franchisors who want to remain competitive in the years to come.
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