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Archive for March, 2012

Franchise Sales: A Tale of Two Theories

March 27, 2012 1 comment

franchise_salesLast year, there was a discussion in the Franchise Executives group on LinkedIn with the posted question, “Who is using outside franchise sales groups [brokers]?”

Below are some interesting responses from group members that are not franchise consultants or brokers:

An experienced franchise executive stated:
“Why wouldn’t you develop your own small sales group? Using a service that sells multiple franchises diminishes your quality control to some degree. I have been a part of 2 franchisors for 25 years and neither has ever used any of these groups and we have had lots of success. What are you trying to achieve by using these”groups”? Lower cost of acquisition, less hassle, expecting more leads, more foot soliders?”

The president of a national franchise concept wrote:
“We do not work with an outside group. In talking with our prospects it seems important to them to know that our development staff are part of the company and experts on the concept they are selling. We even have a dedicated sales team for each concept. My advice is to talk with some of your new franchisees to see if it would have made a difference in their decision making process.”

A franchise attorney posted his response:
“…if you use an outside broker in the true “sales” role, they can lose credibility if they appear detached and not knowledgeable about what they’re selling (often happens when your brand is only one of many in the broker’s portfolio). That should factor into your due diligence process when you’re looking at outside brokers. But when the relationship stays between the franchisee and the sales person, the prospect’s going to be let down when that sale is done and the sales person is on to the next prospect. Besides, I always wanted my sales person’s relationship with the prospect to taper off once the sale was done – the franchisee’s relationship should be with someone on the development then someone on the operations team. Two points – first, I always caution my clients to use brokers more as “matchmakers” rather than “salesmen.” What should really “sell” the franchise is not the sales person (internal or external) or the broker, but the confidence that the prospect has in the brand and in the ability of the management team; and, second, if my clients use outside sales people, I always make sure the outside sales team attend the same training I give my client’s internal team and do so at the same time. That way the outside sales folks get entrenched into the company’s culture, they know what to expect from management, they see how to use management to “sell” the franchise, and they know what management expects of them.”

A Vice President of a national franchise concept went on to write:
“For a variety of reasons I’m personally a big believer in building sales teams from within the company. But then again I’ve had the luxury of working for established franchisors and had resources to either develop salespeople from within the company, or rely on referrals to hire from outside and train them to become franchise salespeople. Both methods take time – generally about 12 months for a franchise salesperson to really “hit their stride”. Many franchisors don’t want to wait that long, or can’t wait that long, or don’t know how to train franchise salespeople. In those situations it may make sense to bring on outside franchise sales groups.”

So, that’s what franchise professionals were saying a year or so ago… but what about today? Please, let us know your thoughts!


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Franchise brands are few and far between on list of top brands in customer service!

March 18, 2012 1 comment

Despite repeatedly hearing that exceptional customer service is paramount in today’s economic environment, franchising sees few brands make the list of top brands in customer service.

Do you believe it’s possible for a franchise brand to consistently deliver positively memorable customer service along the likes of Apple and Amazon.com, just to name a few of the brands that are repeatedly mentioned when discussing exceptional customer service and customer experience?

Are franchisors dedicating enough resources on customer service training? Are franchisees focused enough on providing exceptional customer service?

Personally, I believe it all starts with the culture of the Franchisor and the same must be conveyed to franchisees, not only through training, but in the way franchisors treat franchisees. It must be a top-down effect to start the process and must be on the forefront of everyone’s mind at all times and at all levels of the franchise organization. I also believe an extremely high level of providing positively memorable customer experiences is a key component towards improved unit-economics, and also in helping increase interest in franchise opportunities.

50 Brands Named ‘Customer Service Champions’ as posted on MediaPost.com March 15, 2012

In the faltering economy, the importance of customer service has reached new highs, overtaking even price as a purchase determinant, according to a J.D. Power report.

Read the complete article.

Want to learn more about customer service in franchising?

Mindy Golde, Director of Sales at Listen360 (formerly Systino) discusses Consumer Sales and Customer Experience at the upcoming Franchisee Sales & Marketing Summit. Listen to what she has to say about franchise brands and customer service! FranSummit is March 26-29.

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Can you handle the truth about your social media efforts?

March 10, 2012 Leave a comment

Wow. Talk about a loaded question! To quote the famous comedienne Joan Rivers, “Can we talk?” – I believe the key here is really being honest with yourself. Yes, we need to hear the truth… that is, unless, again quoting another famous person, Jack Nicholson as Colonel Jessep in A Few Good Men, “you can’t handle the truth!”

Well, and I’m quoting again here, this time from one of my all-time favorite movies, The Godfather, “Let me be more frank just to show you that I’m not a hard-hearted man…” Do you feel you could be doing better in social media? Ah heck, let’s ask the real question and stop dancing around, Does your business suck at social media? Below is a really great article as posted on Business2Community.com that may shed some light and maybe even open your eyes… to the truth!

4 Reasons Your Business Sucks at Social Media By , Published March 9, 2012

Social media networks were supposed to be the promised land for small businesses. They were supposed to be the great equalizer, the marketing tools that finally gave start-ups the same exposure as the industry leaders. But if that’s the case, why does your company still only have eight friends on Facebook?

Running a successful social media strategy isn’t as easy as many small business owners think it will be. Your company’s online success depends on several factors, and if you don’t account for all of them, you could find yourself stuck in the social media wastelands. That’s not something many business owners like to hear, but the good news is that getting out of the Internet desert is simply a matter of redirecting your efforts. While thousands of businesses struggle to establish a presence online, they all tend to have trouble with the same four issues. So if you’re not getting poked as often as you deserve, use this guide to troubleshoot your social media strategy.

The articles goes on to list the 4 reasons as…

  1. Stop trying to build Rome. Build relationships.
  2. Be more than active. Be hyperactive. 
  3. Aim for a social media strategy that matches your value propositions.
  4. Stop looking for love in all the wrong places.

To learn more about these 4 reasons, click HERE.

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HR Challenges in Franchising – Mitigating Risk is Key

“Employee management and HR compliance is a tricky topic, especially with the relationship between franchisors and franchisees. Depending on what HR support the franchisor can and cannot provide the franchisee may be on their own in this all important area.” These were the words that Dean Haller, President, CEO & Founder at HRSentry, shared with me in a recent conversation we had about HR challenges within franchising. In an effort to provide resources for the franchise community, I asked Dean to provide me with some information to share on the franchisEssentials site. Dean shared the following…

Even seasoned franchisees feel challenged by myriad demands, human resources among them. Most business owners don’t have time to become an expert in human resources management and can’t necessarily afford to hire one. It’s tempting to let some things slide, but doing so can lead to costly mistakes.

The good news is, with a relatively small investment of time, you can minimize your risk. Here are three crucial areas to keep in mind.

1. Hiring Basics

Application Forms. Purchase a template or create your own. Applicants certify their answers are truthful, giving you a legal basis for not hiring, or firing someone who provides false or misleading information on their application. The form highlights any employment gaps you may want to investigate, felony convictions (if inquiring is permitted in your state) and gives you permission to check employment references.

Smart Interviewing. Make sure all the questions you ask are job-related and thus legal. Your goal should be to get more information about prior behaviors, as the past usually predicts the future. Avoid leading questions such as, “This position requires someone who is organized. What traits would you bring?” Instead, it would be better to ask, “Describe a situation in which you had to juggle competing tasks. What was accomplished? How did you get it all done?” Don’t be afraid to ask about employment gaps or other potential red flags. If the candidate’s answers are short, ask for more detail.

Careful Employee Selection. Although fitting in with your work culture is important, you don’t want to hire someone just like yourself. You want diversity in skills and talent within the company, so you want to hire the best performer. Focus on key job skills, especially those that complement yours and others’. It’s essential to contact a candidate’s references. Ask for more information if the person hedges and, as with interviewing, request specific examples. A candidate can have exceptional interviewing skills, but references may reveal another story. Most important, if you haven’t found the right person, leave the position open longer. Hiring the wrong person is worse than hiring no one at all—and can be expensive.

2. Legal Pitfalls

Employment Laws. Know which state and federal laws apply to your business. The Family & Medical Leave Act, for example, applies to employers with 50 or more employees; your state may have a similar law that encompasses smaller organizations. Use the federal I-9 form and comply with your state’s new hire reporting requirements. A third of states require using E-Verify, the online system that compares I-9 information to Social Security and Homeland Security records.

Exempt vs. Non-exempt Status. Classify employees correctly into exempt and non-exempt categories, according to rules established by the Fair Labor Standards Act (FLSA), which governs minimum wage and overtime requirements. Maintain accurate timekeeping and other personnel records and be sure to pay time and a half to non-exempt staff who work in excess of 40 hours per week.

Independent Contractors. Employers may be tempted to misclassify employees as independent contractors to lower costs; or there can be honest confusion due to different definitions of “employee” for varied state and federal purposes. But states and the feds have been cracking down on violators. To protect your business from having to pay fines, penalties, back taxes, and back overtime wages, analyze contractor positions based on IRS rules along with your state’s unemployment and workers’ compensation rules.

3. Employment Best Practices

New Employee Orientation and Training. Place yourself in new employees’ shoes. What information, tools and training do they need to function in your work environment? Studies indicate that most new employees decide whether to stay or leave a company within the first 6 months, so be sure to be welcoming early on to help them feel part of your team. New employees experience lots of new sensory information—from the physical environment to new colleagues and new systems—so provide information in reasonable increments. If you’re thoughtful of your employees’ new experience, they will become more productive and engaged, and thus, more likely to stay.

Nip Poor Performance in the Bud. Communicate expectations clearly and give constructive feedback for improvement. Make sure you provide enough training and support. If your best efforts fail and termination becomes inevitable, don’t procrastinate. Make sure all performance-related reasons are documented clearly. Even in employment-at-will states, it’s important to avoid any perception of discrimination or retaliation. Treat the person with dignity and respect—not only because it’s the right thing to do, but because it’s good business practice and can help you avoid any potential legal action against your business in the future.

Reward Your Best Employees. Make every effort to properly reward good performance. When the company’s financial situation prevents salary increases or bonuses, get creative—provide flexible work schedules, interesting assignments, or a gift certificate to a great restaurant or spa. Be mindful that it’s costly to replace a good employee, so reward your employees with some kind of benefits if you can.

With the daily craze of operating a growing business, it’s all too easy to neglect areas, such as HR, that don’t seem to directly contribute to the bottom line. But making these suggestions part of your company’s operation can help you avoid hassles and greater costs in the future.

For nearly ten years, HRSentry has helped organizations across the country navigate the tricky world of human resources. Their online tools have been developed to save time, resources and money. For more information, visit HRSentry.com or call 1-800-523-2564.

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