Since the advent of the franchise’s organized business model in the 1960s, the networks have continued to be original and bold in developing new concepts in many industries. This development success is growing year by year. And even in this time of crisis, the success of the franchise model does not falter! Why? What are the success factors for franchisees? And what about the franchisors’ side? Here are some answers!
The ingredients of a franchisee’s success
The success of a franchisee is largely due to his motivation. But motivation is not everything! Indeed, as for a solo creation, a minimum of start-up funds is necessary to give oneself the means (at least the first year) to meet his expenses. The calculation of the necessary contribution leaves nothing to chance. Achieving a seriously supported budget is vital. All the hypotheses must be studied with a magnifying glass by taking each time a sufficient margin of maneuver so that the turnover covers at least the loads. Generally, the most serious market studies are based on a zero point (CA = charges) located around 50% of the average sales estimate indicated by the franchisor. This caution with respect to the figures provided by the franchisor is one of the major ingredients of franchise success. Are you thinking about outsourcing your franchise salesforce? Check absoluzconsulting.com/ to have further information on how to settle your European sales force in a flexible, efficient way, without increasing your fixed costs, and while keeping total control on the strategy, the action plans and the business relationship.
A development accelerator model for franchisors
In the vast majority of cases, companies choose to become franchisors after duly testing the performance of a solo concept. The franchise model is chosen primarily over others mainly for structural and financial reasons. If each case is particular, it does not prevent that the passage of the solo company in the network format requires a concept to the duplicable success. Since manufacturing or supply processes are clearly identified, duplication can generate economies of scale by multiplying points of sale.
The ingredients of a successful franchisor
The ingredients that contribute to the success of a franchisor are numerous. If luck often smiles on the daring, the long-term success of a franchise network must be based on solid foundations. The concept first must be irreproachable since it must be a factor of success for franchisees! Duplicable by nature, the concept should leave nothing to chance for a development today but also and especially tomorrow. Anticipation is required. The least gear must be perfectly oiled. Without this, the network cannot develop serenely. Indeed, where the roughly can be sufficient to less than 10 franchisees, it is no longer tenable when the network grows. To succeed in franchising, each business involved must deliver its promise of offering high-quality products to its consumers.