Franchise Beacon

Where Do I Find FDD’s Anyway?

Michael A. Peterson — Fri, 17 Feb 2023 01:42:58 +0000

Are FDDs Public or not?

The answer is kinda.

If you are like many people, you heard Franchise Disclosure Documents are ‘out there’, and ‘available’, but when you search all you find is sites offering to sell you the documents. There are a couple of reasons for that. First, FDD’s are not public records; they are not like court records, birth, death, and statistical records, or other type of documents you actually have a right to access. For some franchisors, in certain circumstances, you can find their FDD’s online, but if you can’t, no one ‘has’ to share it with you (assuming you are not actively engaged in their discovery process). Irrespective of if you are a potential franchisor wanting to see what this whole “FDD” thing is about, a young franchisor trying to find competitive FDDs to see if you can adopt some best practices, or even a prospective franchisees wanting to find old FDDs of a franchisor that you are considering as an investment, knowing these parameters will quickly let you know if the documents are something you can find, and I’ll even give you the direct links to find them at the end.

The franchisor must be registered in Wisconsin, California or Minnesota. As previously mentioned, FDDs are not public records and some states require franchisors to register their document with state authorities before they can offer or sell franchises in that state. Three such state authorities then make those documents available online: Wisconsin, California and Minnesota.
You must know the legal name of the franchisor; not just their DBA name (Doing Business As). This can be tricky as the legal name may be different from the name used for their brand or business. However, in Wisconsin, the state allows searches for FDDs by both legal and DBA names, so if the franchisor you are looking for is offering franchises in Americas Dairyland, you may still be good to go.
The franchisor cannot fall under the seasoned franchisor exemption. Different states provide different definitions of this, however California is the only state that provides both online FDDs and has this exemption. If the franchisor has a net worth in excess of $5mil, you won’t find their FDD on California’s website.DD on California’s website.

There are other places to find an FDD, but your first stop should be these three state sites:

A. California Department of Financial Protection and Innovation

B. Wisconsin Department of Financial Institutions

C. Minnesota Commerce Actions and Regulatory Documents Search

If you see something in an FDD that doesn’t make sense, want to learn best practices, or are looking to franchise your business or improve or even outsource your franchise sales process, don’t hesitate to reach out!

Since you are looking for FDDs, you are probably considering franchising.

We should connect.

As industry experts, Franchise Beacon prides themselves in offering top notch services to our clients, but also guidance to the franchise world at large.

There’s nothing to lose but questions, and everything to gain by investing 30 minutes.

Schedule a call today!

ECE is the place to be in 2021

Michael A. Peterson — Fri, 12 Nov 2021 17:01:35 +0000

Yes, The ECE Market is the Place to Be in 2021

_{This article was featured in the May/June edition of Franchise Connect.}

Businesses centered around childcare, preschool, tutoring, etc. are often spoken of in “soft” terms. Many individuals that enter into the children’s services space, and specifically the Early Childhood Education (ECE) space, have a desire to “give back”, “leave a legacy”, or “impact children’s lives. This is more than admirable; a desire to contribute to the greater good is a necessity to succeed in this industry. I want to begin, however, by bringing some hard facts to the discussion.

For the last 6 years, I have represented a franchisor in the ECE industry. When I first met the founders of Building Kidz Preschool in 2015, I was intrigued by their model, purported numbers, and passion, but had never considered the industry in-depth. As a metrics-driven individual, I started looking for concrete data on the industry. If you have ever researched the preschool industry, you know what I found, troves of information from extremely reliable sources.

I started, as they say, at the top; with a report from the Executive Office of the President of the United States (December 2014). The report is a detailed analysis of the true ROI, as a society, of early childhood development through education. If you are wondering if the impact of quality pre-kindergarten education can be quantified, the answer is a resounding “yes”. The report determined that for every dollar invested in educating young children, a lifetime societal return of $8.60 could be anticipated. Half of this return is from increased earnings of the child throughout their lifetime, and the other half is divided between increased parental earnings, lower engagement with the criminal justice system, and reduced expenditures on remedial education by the public school system. Outside of the straight dollar return, the report stated that pre-kindergarten age education leads to a “change in cognitive functioning and brain development” and could account for some characteristics, such as IQ, that are often considered to be hereditary.

Moving away from the President’s report and into actual industry numbers, I found the same availability of data. In 2015, the ECE in the U.S. was a $70B per year industry and had grown 13.5% CAGR 2011-2014. As I helped to launch Building Kidz into the franchise world and grow them to their current 30+ locations, the markers for ECE kept improving. In April of 2018, a report was released by Zion Market Research that pegged the 2017 U.S. market at $13.5B, and in February of 2020, a report by Facts and Figures had 2019 global Early Childhood Education Market at $245B and projected to grow over 10% CAGR until at least 2026.

Of course, that was THEN. Before the change that we are still watching remake our social and business structure.

In the last issue of Franchise Connect Magazine, I wrote about the appeal of home services businesses; lack of client contact, generally minimal investment, people investing more in their homes rather than vacations or going out to eat, among others. While completely true, home-based businesses and home services are not for everyone. Many people have a passion for helping their community, a passion for education, and a strong desire to build a physical presence that contributes. Recently I was speaking with Seth Lederman, one of the country’s leading franchise acquisition and development specialists, and he explained it like this:

Out of the 200 or so people that I have helped find a franchise, about half of them are really just looking for the right business for their needs, budget, and, especially now, the current economy. Many individuals, however, are driven to entrepreneurship by a passion. While still looking at unit-level economics and long-term trends, they won’t consider a business that doesn’t engage them in whatever brings them personal satisfaction. As someone who left the medical field in order to pursue a passion for coaching business owners, I can relate”.

The good news is that, while nothing is yet certain, the preschool and daycare industries seem to be surging back rapidly. The need for preschools as part of the economic recovery is both obvious and data-driven. We learned early on in the 2020 pandemic that, more than just an essential business, childcare is essential to business. For businesses that need their workforce on-site, the need for childcare is unquestionable. After the 30th or 50th zoom call interruption, however, the need for work-at-home parents to have childcare available is quickly becoming apparent as well. For the children’s sake, we’ve already explored the impact early childhood education has on their entire lives, but we must remember too that children that were not in preschool pre-pandemic often had playdates and other socialization activities. These activities are now often looked at as unnecessary group exposure, leaving only preschools and daycare centers as an option for early socialization skills to be developed.

The New Normal in Food and Beverage

Michael A. Peterson — Tue, 02 Nov 2021 22:33:08 +0000

How Actions and Reactions Defined the New Normal in Food and Beverage

_{This article was featured in the September/October edition of Franchise Connect.}

This issue of Franchise Connect is focused on the food and beverage space. What I want to share with you, however, is applicable across most franchises; how to be confident in your selection of a franchisor partner. Though this advice is somewhat franchise-ubiquitous, the actions over the last 18 months of franchisors in the food and beverage industry played an outsized roll in their franchisee’s success.

Is Now Really a Good Time to Consider the Restaurant Space?

The short answer is yes. The longer answer is: I can’t think of a better time to evaluate a franchisor in the restaurant space.

I can imagine you reading that last sentence and thinking “sure, there may be reasons why now is not a terrible time to invest in the food industry, but the best?”

Allow me to explain.

I likely won’t shock you when I tell you that most franchisors in the restaurant space were bruised and beaten over the last 18 months or so. It’s an unfortunate reality that some in the space didn’t survive, and others barely so.

The Covid-19 pandemic forced franchisors in all spaces to showcase their ability to execute in three broad areas:

Their ability to both react and react appropriately to unexpected marketplace changes
Their willingness and ability to truly partner with their franchisees
Their ability to truly lead

Let’s look at these one at a time.

Nimbleness and Direction

Dog Haus Restaurants epitomized what nimbleness in action looks like with their 2020 roll-out of “Absolute Brands”. According to Dog Haus’s Director of Franchise Development Erik Hartung, Absolute Brands are a series of virtual brands which re-menu portions of the Dog Haus in-restaurant offerings for take-out or delivery only. Erik explained to me that the company had been considering the Absolute Brands idea for some time, but prior to March of 2020 they were planning a roll-out “sometime in the next couple of years.”

When the pandemic hit and franchisees were suddenly forced to shutter their restaurants, the Dog Haus team went to work, and they went all-in on Absolute. Instead of “sometime in the next couple of years,” franchisees were able to offer the first of the Absolute Brands less than 60 days later, and today they have 4 different virtual brand offerings, with an eventual goal of 8. Dog Haus didn’t complicate things; they used what their franchisees already had; to-date they have only added one new sku to support the virtual brands, and franchisees of Dog Haus are automatically eligible to offer the virtual brands as well. The results? Franchisees generating pre-pandemic revenues by June of 2020 and comping up July 2020/2019.

A True Partner

A franchisor that enlists their franchisees in times of trouble, instead of shutting them out, is much more likely to react in a way that is helpful, rather than neutral or a hinderance. To illustrate this point I will step away from the restaurant space. In reaction to the stay-at-home order of March 2020, Building Kidz Preschools (a franchisor I work with directly) immediately took several actions to help their franchisees. Like many franchisors, they gave an abatement of royalties. Because royalties are typically a small part of a franchisee’s overhead, however, reduction of royalties is more of a sign of solidarity than it is a “life raft”. Franchisees expressed what they needed most; the ability to secure funding to weather the storm. Building Kidz reacted to the franchisees’ request for assistance and secured a relationship with an SBA lender well before the PPP loan program was actually passed through Congress. In so doing, they put their franchisees in a favorable position when the funds were approved; so much so that all Building Kidz franchisees (17) that applied for PPP loans received them.

True Leadership

Dog Haus and Building Kidz are just two example of the many franchisors that were able to step up and effectively lead their organizations during the initial days of the Covid-19 pandemic. They used very different methods, but to the same ends; to react to a sudden, unforeseen market shift in such a way that they either strengthened or, in some cases, outright saved their franchisee’s businesses.

Beyond Theoretical

The ever-changing landscape of 2020 and 2021 has laid bare a franchisor’s ability (or lack thereof) to step up to the plate. If you ask franchisees in two or three years from now how their franchisor helped them weather this storm, your will likely get vague answers. Let’s face it, our memories are short, and as business owners the events of two or three years ago are just not front-and-center in our minds. Right now, as many franchisees are just beginning to return to some sense of normalcy, is the perfect time to use real-world experiences, outside of the FDD, to evaluate the franchisor you are considering joining.

Go Beyond the Document

We all know that the FDD is an invaluable resource to help evaluate a potential franchise investment. If you are a franchise-savvy investor, you likely glance at Item 3, look at Item 7 to make sure it’s in your range, spend a bit of time on Item 20, and then dig into Item 19. However, when evaluating a restaurant franchisor as an investment today, I would encourage you to allow the narrative of the franchisees to carry at least equal weight to the FDD in your decision process. If you see an Item 19 showing that franchisees took a 10-20% hit in profitability yet hear from franchisees that business is recovering and also hear anecdotes that sound similar to Dog Haus and Building Kidz, you are likely looking at a franchise with strong and capable leadership. Likewise, if you see an Item 19 that shows a minimal drop or even increase in profitability in 2020, but franchisees can’t pinpoint how their franchisor helped them either push through the pandemic or make the most of opportunities it presented, you very well may be looking at a brand with mediocre leadership that happened to hold a market position that wasn’t hit hard, or even benefited from, the pandemic.

What Will the Next Challenge be?

The global and domestic economy, and U.S. small businesses, will suffer from another setback in the future. It may be another pandemic, but it could just as easily be caused by a financial bubble burst similar to the dot-com & housing market recissions, or even something completely unrelated to U.S. economics like the energy crises of 1973 and 1979. Prospective franchisees are in a unique position today to know, rather than hope, how well franchisors respond to external threats to their business.

Password Formula

Michael A. Peterson — Mon, 14 Jun 2021 18:16:31 +0000

Password Formula

Note: This is kind of a long article. If you just want to know how to make a unique, secure password for every site you log into, jump down to The Solution

So you might be wondering why a franchise blog is writing about passwords. It’s simple; regardless of your line of work, cyber security is important to you. If you are a franchisor, you likely protect your franchisees bank account information, credit card information, SSN, etc. with a password. If you are a franchisee, you likely protect your franchisor’s intellectual property, as well as your employee’s personal information, with a password. We all use them, and most people’s passwords are simply not safe. Why? There are four steps to a secure password, and I am of the opinion that, for most people, following them is impossible. Chances are you already know the four steps, so feel free to skim and then jump down to the solution if you want.

Step 1: Make it unique

This one seems obvious, but many people don’t even take this simple precaution. How do I know? Because many hacks and password dumps have shown that the top five passwords in use today are “password”, “123456”, “12345678”, “1234”, and “qwerty”. Of course, clever individuals do letter/symbol or letter/number substitution, so that “password” becomes “p@55w0rd”. This was a decent solution 10 years ago, but now this is so common that many dictionary hacking programs will try p@55w0rd before they try password! Now, to go truly unique, many people are recommending password phrases. A pass phrase would typically be something that is meaningful to you, but not obvious. For example, “Lightiningwonin04!” would be a secure, 18-character password. According to Online Domain Tools (link), this password would take a quadrillion years to hack. Not bad! Pass phrases are a good way to make a password unique. We could even bring this up a bit with some simple letter/symbol substitution and make it “L!ght!n!ngwon!n04i”, and we are even more secure. There is no such thing as an uncrackable password, but an 18 character password that uses letters, numbers, and symbols and only has one actual word in it (“won”), is pretty close. You could get closer with a random string of characters, but random strings won’t likely make it past step 2.

Step 2: Don’t write it down

This one seems pretty obvious, and I won’t belabor this, but your password is not secure if you save it in plain-text on your computer, email it to yourself, or write it down somewhere that someone might find it.

Step 3: Different passwords for different sites

Now this is where things get difficult. On a daily basis I typically log into 5-10 sites which might include my CRM, Google, Twitter, Facebook, Linkedin, my bank, my other bank, my utilities, etc. If I had to guess, I probably log into 20-30 sites over the course of a month. If just one of them gets hacked, and I am using the same password for the others, my entire cyber security is out the window, regardless of how good my password is. You should use a different password for EVERY SINGLE ACCOUNT.

Step 4: Changing passwords

How often you should change passwords is a matter of debate, but I think that you should change at least once a year, and any time there is an issue with security.

Really, it’s impossible

Lets be honest, you can’t remember 20+ unique passwords that change every year. It just isn’t happening. At this point you probably think you have only two choices; compromise your security by eliminating one of the steps (most people eliminate step 3), or use a password manager. The problem with the first choice is obvious, the problem with a password manager is that it can be compromised, and you can run into issues if you are using a computer other than your own.

The solution

So let me give you a fairly simple solution. Its called a password formula. If you have a password formula, like I do, you then only have to remember one formula and you will remember every password to every site you log into. You can change your formula once a year, and you have true cyber security. I am (for obvious reasons) not going to share my personal formula, so I am going to give you an example.

Here are the steps:

First, chose a symbol. For this example we will use “!”

Second, chose the letter formula. For this example, I am going to use the first, second, and and last letter of the service I am trying to log into. So for LinkedIn, it would be “L”, “I” and “N”. I am going to add the first initial of my middle name in the middle. So my letter formula would render “lian”. To make it a little more complex, add a capitalization. I will capitalize the last letter. So far my password for LinkedIn using this formula is “!liaN”.

The third step is to select four non-consecutive numbers that are not specific to you (not tied to your date of birth, year of birth, kids birthday, SSN, etc). I am going to use “21478” (look at the number pad on your keyboard and you will understand why). So now my password is “!liaN21478”.

Finally, lets select one more symbol. I am going to use “)”. So my final LinkedIn password with this formula would be “!liaN21478)” That is an 11-digit password that would take a few million years for a brute-force hack. A dictionary hack would be completely unsuccessful. But I can remember it fairly easily. With this same formula, my Twitter password would be “!twaR21478)”, and my Gmail would be “!gmaL21478)”. I now have a unique password, its different for every site that I log into, I can remember the formula therefore I can remember every password, so I don’t have to write it down. When it comes time to change my password, I can simply change the number set, the symbols, and/or the capitalization and fairly easily memorize a new formula. Also, if I have multiple log-ins, I can easily modify this formula to account for that. If I have, as an example, two LinkedIn accounts, I can either start or end the password with a number (1 for the first account, 2 for the second) or a letter (P for personal and B for business).

Don’t use this formula exactly, obviously. Come up with your own. Here are some ideas of what you can put in the formula:

_• The name of the service you are logging into

_• The URL of the service

_• First letter of your, your spouse’s, kid’s, business partner’s, or best friend’s first, middle, or last name

_• The middle numbers of your home or work address (just not all of the numbers)

_• The area code or prefix of your phone number

_• The first or last 3 numbers of your office zip code

As a last note, this might seem to complex. Too hard to remember. But think about the passwords you are remembering now. By having a formula, you only have to remember one password to have unique passwords to every website you log into. I think you can handle that complexity!

For what it’s worth, I don’t use this on every single website. I have a “throw-away” password. It’s been in about 22 breaches. I use it on sites that I will never share my DOB, SSN, banking, or other info on.

Apps Home

Michael A. Peterson — Sun, 13 Jun 2021 20:12:26 +0000

Franchise Beacon Scripts and Apps Home Page

If you are using a script or app designed by us, and you have any questions, feel free to email me or call me. If you don’t have my email or my phone, then you really shouldn’t be using the app, but feel free to check out our app policy and app privacy pages.

PRIVACY

Michael A. Peterson — Sun, 13 Jun 2021 20:05:01 +0000

Franchise Beacon Scripts and Apps Privacy Policy

If you are using a script or app designed by us, we don’t make any attempt at collecting any information about you ever, period. If any information is collected, it is inadvertently done so based on the platform (currently exclusively the various google developer platforms). Any information that is collected will not be shared, sold, traded, exchanged, bartered, swapped for a haircut, or given to anyone else for any reason.*

Please note the above does not apply to any forms we create. Forms obviously are intended to gather and keep information. Currently, we do not have any forms that we make available, but if we do they will have a unique policy.

*The obvious exception is if we are required to by law. I have no idea how that could happen, but if it did, we will share any information demanded by any party that appears to have the legal right to do so, and we will, unless legally bound not to, immediately tell you about it.

TERMS

Michael A. Peterson — Sun, 13 Jun 2021 19:56:49 +0000

Franchise Beacon Scripts and Apps Terms

Any google documents, spreadsheets, etc., that are provided to you that have attached scripts or apps are provided strictly as-is. Franchise Beacon does not:

Charge for any scripts or apps
Share usage information about these scripts with any person at any time for any reason*
Warrant the usability any such apps or scripts for any use.

*The obvious exception is if we are required to by law. I have no idea how that could happen, but if it did, we will share any information demanded by any party that appears to have the legal right to do so, and we will, unless legally bound not to, immediately tell you about it.

Building a successful pet grooming franchise

Michael A. Peterson — Thu, 13 May 2021 12:40:58 +0000

See the original article here in Franchise Connect Magazine

Building A Successful Pet Grooming Franchise

Although I have an extensive background in franchising, until recently I have had limited exposure to the pet services segment. I am glad that has changed!

I have had pets all my life, and I have been in franchise almost 15 years. However, my knowledge of the overlap, i.e. the pet franchise space, was fairly limited until recently. Since December of 2020 I have had the pleasure of working with Keith Miller, founder of Bubbly Paws dog grooming in the greater Minneapolis area, as we turn his pet grooming business into the newest pet grooming franchisor.

When I learned this issue of Franchise Connect was going to focus on the pet industry, I saw an opportunity to bring a voice to the table that is rarely heard in the franchise space; a business owner that is partially through the process of becoming a franchisor. I believe that Keith’s extensive experience owning pet grooming locations combined with his recent venture into franchising allows him to provide unique perspective into this industry.
I sat down with him recently to discuss Bubbly Paws, the pet grooming industry in general, and the advice he would have to offer somebody who is considering coming into this industry as a franchisee. I’m excited to share our conversation with you, as well as some of my own observations, below.

Michael
Keith, thank you so much for sitting down with me today! I know you’ve got a lot going on; four dog grooming businesses that are booming, a new baby at home plus your 5-year-old, and now trying to break in the franchise industry all at once! You really do have your paws all over the pet industry, don’t you? Besides Bubbly Paws, you also own Pampered Pooch Playground, which is a doggy daycare, and, as I understand it, you’re a podcaster in the pet industry?

Keith
Yes, I run a podcast for pets plus magazine. I love it because it allows me to stay in touch with my roots, as I started my career in the radio industry, as well as provide what I hope is useful content to people in this business. We concentrate on content and interviews that are helpful to individuals in the pet grooming industry.

Michael
Like I said, a busy man! Let’s talk about Pampered Pooch for just a moment and then we’ll get into Bubbly Paws. Pampered Pooch was your first foray into the pet services industry, right?

Keith
It was. We’ve had Pampered Pooch since 2008. 13 years!

Michael
And it was actually your experiences at the Pampered Pooch that led you to launch Bubbly Paws, correct? Tell me about that.

Keith
Keep in mind coming this was 13 years ago. The doggy daycare world was just taking off, and we would often have people stop in and asked to use our tubs on the way back from a romp in the park. We weren’t really set up for that, though we did try to accommodate them when we could. We even considered adding tubs to the doggy daycare but frankly most of our customers picked their pals up on their way home from work or from a trip; they wanted to be in and out quick. So, we decided to launch Bubbly Paws Grooming.

When Keith launched Bubbly Paws almost 11 years ago, he experienced the same unexpectedly rapid success in the grooming market as he had in the boarding space. One location in 2011 became two locations in 2013 and he opened the doors of his 4th location at the end of 2017. When my team conducted a franchise feasibility study for Bubbly, we saw a trend; each location experienced rapid growth in the first 6-12 months, getting quickly to break-even and beyond, and then sustained year over year increases in all locations. We also saw a couple of significant market differentiators.

The first was a fantastic use of social media, including memes, influencers, and dog “ambassadors” to market their locations.

A recent scroll through Bubbly Paws tagged posts on Instagram revealed a post from 7 days previous by Murphy in Minnesota (a sheepadoodle with his own Instagram) with over 1000 likes and comments.

Besides their strong marketing platform, they also offer a service that is becoming ever more popular in the #newnormal world.

Michael
Keith let’s talk about a one of the things that you have done to help Bubbly Paws stand out in the Twin Cities marketplace. You mentioned that the genesis of Bubbly Paws was people coming to Pampered Pooch and asking to bathe their dogs, so you decided Bubbly Paws would have a self-service option, right?

Keith
Exactly. Though most of our services focus on full-service grooming, we do offer a self-service option. Self-service has wide appeal for a couple of different reasons. First, you don’t have to make an appointment weeks in advance. Before the COVID pandemic, even on a beautiful spring Saturday you wouldn’t wait more than 30 minutes, and rarely even that. Now we have an online reservation system so there is never a wait for self-service. It’s a perfect solution for a messy trip to the dog park; hop on the app and book an appointment on your way to the park, and swing by on your way home. Self-service also allows some of our customers that are more budget conscious to wait longer between groomings, instead of coming in every six weeks they can come in every eight weeks or even 10 weeks, and still keep their friend un-stinky in between groomings.
Now, with so many people working from home, getting groceries delivered, and having very little reason to leave their houses, we are finding that just getting out of the house to give their dog a bath in our facilities is what they look forward to for the day. Our bathing rooms have fantastic filtration and ventilation; after all who wants to smell wet dog, you know? The HAVAC systems filter the air out of each bathing room, and are equipped with UV lights which destroy various airborne viruses, like the rhinoviruses and influenzas that cause kennel cough. What better way to get out for a bit than to go to a safe, socially distanced environment that, by its very design, reduces the likelihood of exposure to airborne pathogens?

We saw this reflected in the feasibility study as well. Surprisingly, despite the world-wide disruption caused by the pandemic, amplified by the social disruption that Minneapolis experienced this summer, by the end of 2020 all but one Bubbly Paws location were back to pre-covid numbers, and the 4th is almost there.

To wrap up our conversation, I asked Keith to share his best advice for people who are considering entering into the pet industry. Here’s what he had to say.

Keith
The pet industry numbers are extremely attractive. We are talking about a 10-billion-dollar marketplace that had 6% CAGR growth expectations before the pandemic started, and now industry analysists are saying that is conservative. Honestly, if that is why you are considering this industry, you are looking at the wrong business. I don’t see a path to success, at least in our segment of the industry, for someone without a passion for pets. Pet owners don’t want their family members in the hands of someone that is just in the business for the margins. Groomers don’t want to work for someone like that. Your customers, your groomers, everyone you interact with will pick up on the lack of passion, and you will struggle with both employee retention and customer retention.
For those that have the right passion, before you decide to buy a franchise, do your research on the franchisor. Every detail is important in a pet grooming store; the ventilation, placement of the windows, the shampoos, and cleaners you use, where the bathing rooms are located in respect to the entrance, everything. Visit a few franchise locations; if you don’t see a painstaking attention to detail everywhere you look, then it’s time to look elsewhere.

We are still working through the franchising process. We expect to bring the Bubbly Paws brand to franchise market by mid spring. I, for one, am looking forward to seeing Keith’s passion for pooches translate into a strong, sustainable franchise model.

I Just can’t sell

Michael A. Peterson — Wed, 24 Mar 2021 17:42:41 +0000

See the original article here in Franchise Connect Magazine

I Just Can’t Sell

Many franchises in the home services sector require franchisees to engage in the sales process with the customer. If you think you just “can’t sell”, I promise you, you can.

In February of 2020, the world began to change, and the tectonic plates that underpin our personal, social, and business lives are still moving. For some people, this is the time to hunker down; others see opportunities in the changing landscape, or simply must pivot due to a lost job or other source of income. Irrespective of the reason, franchisors in industries ranging from in-home senior care to preschools to gift basket delivery are reporting year-over-year stability or growth in franchise development.

Home-based businesses are uniquely attractive in 2021. With minimal or no staffing or real estate requirements, and reduced face-to-face exposure to customers, the appeal is obvious. Home services businesses have an added advantage. As Tim Smeltz, the founder of the driveway repair and maintenance franchise NextGen GreatSealcoating recently told me, “Even people that are not working from home are spending significantly more of their free time in their houses. Our homes have truly become our sanctuaries, and people are spending more on both upkeep and the aesthetics of their home environment.” His case is supported by the fact that his first franchisee, who opened in May of 2020, took less than 90 days to break even (according to NextGen’s Franchise Disclosure Document). There are many brick and mortar businesses that are equally well-positioned, such as childcare, senior care, and fast-casual delivery, but the home services sector has most certainly enjoyed a lift in visibility.

For some, these obvious upsides can be tempered by the daunting idea of becoming a “sales person”. If you are hesitating to get into the home services space for this reason, I have great news for you; not only can you sell, but without ever meeting you I can tell you the sales style that you should adopt to sell effectively, and eventually even become great at it.

To be clear, a great salesperson is not someone that can “sell anything to anybody” or “water to a drowning man”. Part of being a great salesperson is identifying someone’s need or want and helping them comfortably reach a purchasing decision that fills it. Salespeople that “convince” someone to buy a product or service that isn’t right for them are not “great’, they are con artists.

So, how do you become comfortable in a sales role? It’s simple, really. First, I’ll share with you the two pillars of any great salesperson, and then I’ll tell you how to find your unique sales voice.

Lay Your Foundation

Pillar one: Become a scholar of your business.

Study your competitive landscape, and what differentiators you offer. Understanding both the strengths and weaknesses of what you are selling is pivotal. I sell franchises for a living, and of course part of my competitive landscape is simply non-franchised businesses. Starting your own business without a franchise does have advantages; for example, franchisees have restrictions on how they can advertise, or what products and services they can offer. If I were to not acknowledge this, at best my prospects would think that I didn’t understand franchising; at worst they would think I was dishonest. By understanding the limitations of your model, you can contrast them against the strengths, and again help the customer reach the decision that is right for them.

Pillar two: Know your competitor’s business as well as your own.

Every business owner sells on their own unique value proposition. In order to effectively communicate what makes your service different and valuable, you have to know the market. When your prospect brings up either a competitor, or even just a feature or benefit that a competitor offers, you’ll be much better positioned if you’ve already studied the advantages and disadvantages of the competition. Also, and equally important, your prospect may simply ask you questions to see how well you know your business; be prepared to answer them.

Zig Ziglar, one of the great sales theorists of all time, famously wrote that “sales is a transference of emotion”. This one phrase has many layers; the fact that you have to be enthusiastic about what you are selling and that people make buying decisions based on emotion backed by logic, rather than the other way around, are just two. Another, which you may not have considered, is that no matter how much you believe in your service you will struggle to covey enthusiasm if you are nervous. It’s hard to be excited in the moment when you are worried about your ability to answer customer questions. Suffice it to say that Mr. Ziglar was not referring to nervousness and self-doubt as the emotions that you need to transfer in a successful sale!

Find Your Voice

Of course, knowledge by itself will not make you a great salesperson. You must be able to transfer the appropriate amount of knowledge, along with enthusiasm and excitement, so that your prospect is fully informed and not overwhelmed. To accomplish this, you must have the knowledge base, and know your best method of walking the prospective candidate through your process, and ultimately decide to do business with you.

Buy Your Own Offering

I don’t mean actually make a purchase from yourself, but mentally go through the sales process from a customer’s point of view. Find the level of information, the tone, and the communication methods that would make you most comfortable if you were the customer. Break you’re the sales process down into steps and analyze each step through this lens. Ask yourself:

What information would I need to know at this step to move to the next step.
What information would overwhelm me at the stage. This is actually a difficult mental exercise; we like to think that we can just take in all of the information and make a logical choice, but that is simply not how we make decisions.
What information, if it wasn’t shared at this point, would you feel was misleading by its absence.
What tone, approach, or style would take you from considering to buying?
What would make you walk away from the purchase?

These 5 questions, when answered for every interaction along the sales process, will illustrate for you your most authentic sales style. If you start from a base of authenticity, and have a deep understanding of your service offering, you will be able to sell comfortably. As you interact with your first several prospects, go back to your notes and see where you may have been incorrect, or where you may need to make minor adjustments to ensure what you are saying and what your prospect is hearing match up.

I told you it was simple! Using this process, you may not start out great, but you will start out proficient. Most importantly, you’ll be comfortable, because you are not trying to force yourself into selling in an unnatural way. If you continue to use this lens to study your sales process, greatness in sales is achievable.

The Distinctiveness of Franchise Development

Michael A. Peterson — Wed, 23 Dec 2020 03:08:01 +0000

Franchise Sales is unique. So is the franchise purchasing decision.

I was recently discussing franchise sales with a friend in the franchise lead generation business (a franchise portal) and the subject came up of just how unique the franchise industry is.

I can promise you there is nothing else like what we do. If you are new to franchise sales, or even if you are a seasoned professional, you may have never realized, or lost sight of, the truly unique nature of a franchise sales transaction.

Let’s start out with the obvious; franchise sales can be frustrating. There are so many things outside of the development professional’s control that can blow up a perfectly good placement; a bad first validation call, an ill-timed yelp review for one of your franchisees, or a franchise coach steering a candidate that you know is a good fit toward another brand, just to name a few. Franchising in general, and franchise sales specifically, also takes patience. In my franchise career, which is approaching 15 years, I have had one franchise sale that took over 900 days to progress from first contact to agreement signing, and close to a dozen that have taken over a year. I can tell you, without a doubt, I have the patience for franchise sales, franchisee management, and franchise consulting in general only because I understand the uniqueness of my chosen field. In this article, I am only going to address one part of that uniqueness: the prospective franchise candidate’s decision-making process.

You Are the Last in A Line of Decisions

In order to maintain patience, and more importantly empathy, during the franchise mutual evaluation process, all you need to do is step out of your bubble and put yourself in the prospective candidate’s shoes. Investing in your franchise brand is not a stand-alone decision; it is the last of 5 decisions, all of which are pretty heavy. Let’s look at them individually. A prospective franchisee must decide:

To be in business for themselves. This seems self-evident, but if either you haven’t made this decision yourself, or it was a long time ago, take a moment to remind yourself how intense of a decision that is. As a business owner, if things go wrong, it’s your fault. If you lose your investment, your business, harm your family’s financial situation, as the owner the buck truly stops here. In my opinion, this takes a while for most people to fully internalize, and many never acknowledge it consciously. I believe at least some seemly-solid franchise sales fall apart in the 11th hour because the fear of failure with no scapegoat is something the prospect just can’t get past.
To walk away from their careers. Separate from number 1 above, if your brand is owner-operated, remember there are businesses that offer a fairly passive role for the owner, allowing them to stay employed. Being an active franchisee often means giving up benefits, retirement plans, and the assurance, no matter how flawed, that they have a “job” and therefore their income is steady.
They want to be in your industry. Your industry is likely either mature, meaning that it has a proven record but also probably has many big players, or emerging, with few if any institutional competitors but also without a long track record of proven success. If you happen to be in between the two, the odds are your industry going through a period of consolidations, commoditization, and other growing pains. No industry is immune to this. QSR, service-based industries, tech industries, the senior care industry, and all others have some unique combination of benefits and drawbacks. My day-to-day includes working with both a leading preschool franchise brand and a business to business services brand. The cost reduction company, P3 Cost Analysts, offers an executive, home-based franchise with a low upfront investment, the preschool business offers a unique, flexible business model, and they both offer industry-leading returns, but neither industry is for everyone!
They want to be a franchisee. The franchisor/franchisee relationship is at times strained. Franchisees don’t have full control or autonomy over their own business. You will find certain prospects wouldn’t consider “going it alone”, while others will be more resistant to the idea as they work through your process, but in every successful franchise sale the prospect at some point decides to accept the good and the bad of franchising.
This is you. Step five. In order to make an investment decision with your brand, a prospective candidate has to have worked through the previous four. With some very few exceptions, however, prospects are still working through those when they contact you. This is why persistence in the franchise sales process is key.

So, the next time a franchise prospect goes cold on you for a week or two, or a month or two, and then resurfaces, reflect back on these five steps, and have empathy. The next time you lose a “perfect”, well-matched prospective franchisee, realize that, even if they were the right fit for you the reverse might not have been true. It won’t make the loss of a franchise sale, or the patiently waiting weeks for returned calls, to be any less frustrating, but with empathy comes understanding, understanding builds your knowledge, and a stronger knowledge base will make you better at this thing we do.