Franchisees and The 90 Day Window

Guest post by: Ed Teixeira
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The Traits That Define Good Leadership - By Ed Teixeira

One thing I've learned after a long career in the franchise industry, is that there is approximately a 90 day period for an effective franchisee start-up. There are some exceptions to my 90 Day Window rule, however, in most cases it applies. Importance of the 90 Day Window: Most franchisees don't have sufficent working capital to last beyond the first 6-9 months of their franchise operation. Even the investment schedule in Item 7 of the Franchise Disclosure Document uses a 3 month period in estimating additional working capital required by a new franchisee. The longer it takes a new franchise to get fully launched the easier for competitors to zero in. Without a fast start-up, a new franchisee can get disillusioned as they wait for new sales to come in. If sales dollars don't come in during the 90 Day Window the franchisee will get anxious as the business is "burning" cash. This could lead to the franchisee cutting back on payroll and advertising. The role of the franchisor during the 90 Day Window: Schedule and coordinate franchisee training so that after training the franchisee can hit the ground running Have a strategy and process that enables the franchisee to pre-launch certain sales activities before the franchise is operational Have ample supprt and assistance available for new franchisees during the 90 Day Window Its critical that new franchisees get off to a fast start. Most new franchisees have enough capital to fund the start-up and another 3-6 months of operation. Some franchisees will have less. Franchisors need to do all they can to enable a fast start for new franchisees during the first 90 days of their operation.

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The Traits That Define Good Leadership - By Ed Teixeira

About the Author: Ed Teixeira

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Ed Teixeira is a franchise expert with over 32 years in the franchise industry. During his career, Ed has operated franchise companies in diverse industries. He has conducted franchise transactions in Asia, Europe and South America. Ed is the author of "Franchising From The Inside Out" and has spoken on the subject of franchising in the United States and overseas. Ed is currently the President of FranchiseKnowHow,LLC which operates a website that publishes newsletters for franchisees and franchisors.He also provides consulting services. FKH is located in Stonybrook, NY. www.franchiseknowhow.com Ed can be contacted at 631-246-5782 and at franchiseknowhow@yahoo.com.
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Franchisees and The 90 Day Window

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