Franchise Fees Produce Income, but be Careful
Be Careful How You Take Franchise Fees!
Sounds like a problem you would like to have, right? Too many people trying to give you money.
Well, in franchising, it is important to be careful who you take franchise fees from. Each time someone pays you a fee, you enter into a long-term relationship in which you need to do your best to help them be successful.
Here are some questions to ask yourself before you receive a franchise fee: What is the source of their funds? Who will actually own the franchise? Can I picture myself doing business with this person for a long time? Do I like them? Is this person like others in my system who are successful? Is this person generally positive, or negative, about life? What are their true chances of success? Are they realistic about what the program can do for them?
Sometimes it is difficult not to take every fee opportunity, but if you are somewhat selective about who you accept into your franchise system you are likely to have a higher percentage of franchisees who are successful.
In fact, if you don't turn people down, who are ready to give you the franchise fee, you are probably accepting franchisees that may not be a good fit for your franchise organization.
Before taking that fee think about your obligations and the long-term relationship that you are about to experience.
But, take those initial fees, from the right candidates!
What is the purpose of the initial franchise fee, and how is the money allocated?
The initial franchise fee compensates the franchisor for the knowledge, experience, support, and brand that are provided to the franchisee. We ask clients, "If someone were to start a business like yours, how much time and money would it take for them to learn what you know?" Most roll their eyes at the thought! Franchisees are willing to pay something less than this amount for a "jump start" along with ongoing assistance.
The initial franchise fee reimburses you for the cost of developing your franchise program, pays for the cost of making the sale (advertising and commissions), reimburses you for training and start-up support, and includes some profit as well. Helping you determine the amount of your franchise fee is part of our Strategic Planning service, and we will be happy to provide franchise fee research.
More information can be found at: www.biltmorefranchise.com
Franchise Fees Produce Income but be Careful - To learn more about this author, visit John Power's Website.
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John PowerJohn Power, founder of Biltmore Franchise Consulting, has extensive experience developing and marketing franchises and business opportunities. He has been in and around franchising for over twenty years. From 1980 through 1990 he conceptualized, organized, and developed the American Video Association. He grew AVA to 2,000 national members, before selling the company it 1990. It was later merged into another home video marketing company. From 2000 to 2005 he worked as a contract marketing and human resources consultant to several local and national companies. In 2005 Mr. Power began working as a franchise development consultant on a full-time basis. Since that time he has helped more than three dozen companies initiate and develop their franchising program. He notes that there are many companies interested in developing a franchise program, and who need his specialized assistance. Mr. Power is a “hands-on” franchise consultant. He said, “I am the ‘nuts and bolts’ person who tends to the details for my clients.” Mr. Power holds a B.S. degree with a major in Marketing. See: www.biltmorefranchise.com You may contact Mr. Power at: jpower@biltmorefranchise.co - Visit John Power's Website |
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Anne BarrAnne Barr has over 26 years experience in sales and marketing, six years as a franchisee. She has assisted over 367 business owners and purchasers to achieve their goals in career change, transition and exit strategy. She holds the designation of Certified Franchise Executive from the International Franchise Association, Certified Business Intermediary from the International Business Brokers Association and Board Certified Broker from the Texas Association of Business Brokers. Anne is active in professional organizations, networking groups and volunteers for non-profit entities. As owner/operator of four successful businesses, Anne has proven people skills and enjoys helping clients find the right "fit" in business ownership. Visit www.FranchiseOpportunitySpecialist.com for more information about me and my company. - Visit Anne Barr's Website |
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John BrennanJohn Brennan Ed.D. Dr. Brennan is President of Interpersonal Development, LLC, a training and development firm. Interpersonal Development has provided sales training and coaching to more than 3,000 sales reps from over 100 companies. A native of Australia, Dr. Brennan received his doctorate from the University of Rochester. His dissertation researched the effectiveness of Behavioral Modeling Technology in training people in interpersonal skills. While he has spent most of his career designing or delivering training, he was also a Vice-President of Sales of a training and development franchise with operations in 25 markets. Dr. Brennan has designed and delivered sales training in North America, Asia, Europe, Australia and the Middle East. He has been a guest speaker at numerous national and regional professional conferences. When Microsoft wanted Best Practices articles on sales for their web site, they called Dr. Brennan. The results are at http://office.microsoft.com/en-us/FX011387391033.aspx His firm’s clients have included Volvo, The Prudential, Merrill Lynch, Eastman Kodak, Gannett, Equifax Europe, the Economist Group and countless small businesses. - Visit John Brennan's Website |
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Jay Kubassek(Jay's Full Bio: EvanCarmichael.com/jaykubassek) In five years, Canadian-born entrepreneur Jay Kubassek went from selling mufflers at a Midas franchise to revolutionizing Internet marketing with the 2004 launch of CarbonCopyPRO, a online marketing education company, now worth over $20 million with customers in over 160 countries.
As an independent film producer, his upstart film fund Aliquot Films is currently producing a films with Spike Lee and Abel Fererra (starring Ethan Hawke and Dennis Hopper.)
Jay's entrepreneurial spirit is irrepressible. He’s the owner of five companies, a professional speaker and trainer, international real estate developer/investor, extreme sport enthusiast and emerging philanthropist. Jay resides in NYC with his wife Jamie, son Milo and dog Cooper. Visit Jay's official website: www.JayKubassek.com - Visit Jay Kubassek's Website |
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