On Get Business Smart, I talked with Tony Bradshaw about how the franchise discovery process works, from the first conversation about your story to meeting the team at headquarters. We covered building a personal model instead of shotgunning it, what companies have to disclose, talking with owners already running the business, service and brick-and-mortar businesses, why I don’t push anyone toward a business, and the support a franchise company gives its owners.
In this episode
- Introductions
- Franchise or independent business
- How the process works, step by step
- The companies I work with
- Understanding the all-in investment
- Service businesses and brick and mortar
- Differentiation, and why I don’t push a business
- The support a franchise company gives you
- New companies and experienced founders
- Resources for growing yourself
- Where to find me
Why narrow your franchise search instead of looking at everything?
Because looking at everything is shotgunning it: throwing stuff against the wall and hoping something sticks. That’s a tough way to live life. I’d rather build a personal model around your background, your interests and the life you want, filter out what doesn’t fit, and get laser focused on the businesses that make sense for you.
It can be the best company in the world, but if it’s not the right fit for you, we filter it out. The model isn’t only business considerations, either. Maybe you want time to visit a friend across the country, or you’ve got family in different places. Do you want to keep your job and add a business, or make it all of your time? Do you want to work in the business, or on it with a general manager?
Once you start talking to companies, I put a coaching hat on and help you hold true to that model. A lot of times we make small pivots along the way, because you learn about the businesses and about yourself too. Your plan has two to four companies: enough to compare, few enough to go deep.
“If you’re shotgunning it, you’re really throwing stuff up against the wall, hoping it’s going to stick, and that’s a tough way to live life.”
Not ready to talk yet?
Take the QuizWhat should you weigh besides the numbers in a franchise?
Culture and operations, as much as the numbers. Look at how the company handles marketing and operations, whether you’ll need a manager, and what it takes to build the business up and keep it viable long term. Looking at it from a lot of different angles mitigates your risk, though there’s risk no matter what you do.
Franchise companies are regulated, and they have to disclose certain information, including failures and litigation. Even companies that are very different from each other follow a similar process, so you can benchmark them side by side. Most of the companies I work with also share financial performance numbers, and that’s where the real numbers come from, along with owners already running the business.
I talk to people about scalability and sustainability: what you have to put in to build this business up, whether that’s money or your own blood, sweat and tears, and what you have to do to keep it viable long term.
Then validate it. I’ll give you information on a company, and the company will give you information on itself, but I want you to hear it from owners already running the business, because there are always going to be challenges. I talked more about that on the En Factor Podcast.
“You’re working it from a numbers perspective, but also from a culture and overall operations perspective. Looking at it from a lot of different angles mitigates your risk. There’s risk no matter what you do, even not doing anything is taking a risk.”
What happens at a franchise discovery day?
It’s the last step before you decide. You meet the team eye to eye, mostly in person, sometimes virtually, and learn what the company is about. You can learn everything about the business, but then it’s about the people, the culture, and connecting with them. It’s about finding a good fit for each other.
Some companies call it a meet the team day, others a discovery day. It matters because once you sign on, you own the business, but they own the brand. You want to be sure you’re on the same page with them before you go any further.
“If you move forward with a company, the last part of the process is meeting them eye to eye at their headquarters, learning about what they’re about, because you can learn everything about the business, but then it’s about the people, the culture, and connecting with them.”
What support does a franchise company give its owners?
Training first: how to be an owner and manager in that particular business, then ongoing training as things change. Beyond that, help with marketing and operations, call centers, national advertising and sometimes national accounts, plus a peer network and mentor groups. You want them to make you look bigger than you are on day one.
They train you to be a business owner even if you already are one, because every business has things unique to it. The point is that you understand where your business is, your financial situation, and what you need to do on marketing, operations and developing your people.
You’re not on an island. Somebody who spent years in another industry walks into a whole network of owners in that system who support them. For a business with a location, the company also helps with real estate: finding the right site and knowing what to pay in rent for the model to work. They sign off on your location just like you do, and you want it that way.
“When you look at a franchising business, you want them to make you look bigger than you are on day one.”
How do you tell if a franchise company adds value?
Ask yourself two things: can I do this myself, and why does this company add value? Look at what it actually does for its owners, from training to marketing to operations, and check that with owners already running the business. And remember, they’re not successful if you’re not successful. They have skin in the game too.
The company makes its money on royalties, so if you’re not building a solid business, neither of you will be successful. That’s worth remembering when you weigh what they bring.
I’ve been involved in independent businesses and franchise businesses, and you can be very successful either way. But it’s nice to start on second base instead of trying to get out of the dugout. I got into that choice on The Beyond Business Podcast too.
“I talk to everybody about asking yourself: can I do this myself, and why does this company add value?”
Key takeaways
- Start with your story and the life you want, before any business.
- Just because I like a business doesn’t mean it’s going to be the right fit for you.
- Don’t shotgun it: narrow down to the companies that actually fit.
- Validate what a company tells you by talking to owners already running the business, because there are always going to be challenges.
- Ask yourself whether you could do this on your own, and what the company actually adds.
- A lot of times we make small pivots along the way, because you learn about the businesses and about yourself too.
Questions people ask after this one
You never pay me. The franchise brands do, and only if you end up buying one.
Then you decide not to do it. That is a legitimate outcome and it happens regularly.
Two to four, chosen because they fit what you told me. Enough to compare, few enough to go deep.
This conversation first aired on Get Business Smart. Listen on Get Business Smart
