Why You Lost Yet Another Franchisee Prospect to Your Competitor
Every Franchisor has his heart broken every now and then and, for some, far too often in the 11th hour.
A wise franchisor will speak with ex prospective franchisees and find out why they didn’t move ahead. Unfortunately, franchisors are usually too busy managing their businesses or working with new franchise candidates. It’s a vicious cycle. Chances are they will keep losing candidates and never know why. Franchisors need to take a hard look at their franchise opportunity from a perspective franchisee's point of view.
If you have experienced franchise sales that have fallen apart in the final stages, chances are it had nothing to do with what you did in the final stages. It's more than likely that it has to do with everything that happened prior to that point. Many prospects are non-confrontational; many will keep going with the flow even though they have concerns right from the beginning.
Here are a few things that you MUST have in place or correct:
One of the most important elements in consummating a franchise sale is having strong validation from your franchisees. From our experience speaking with some of the smartest minds in franchise development, we can tell you that no matter how good they are, if they didnt have good references from existing franchisees, it was an uphill battle. As a franchisor, you will never have 100% of your franchisees completely satisfied. However, that doesn’t mean that you can’t have every one of them speaking highly of you and the franchise.
The majority of franchise owners fall into two camps; they are either emotional or logical. Emotional franchisees want a franchisor who sincerely cares and supports them well. Logical franchisees are usually all about the numbers. If you focus on the combined variables mentioned above, you usually can’t lose. When prospective franchisees call your existing franchisees, they will either hear about how caring and supportive you are and/or how profitable their business is. You need to appease both the emotional and logical franchisee to ensure outstanding overall references.
We advise all aspiring franchise unit owners to speak with existing franchisees in the system before investing. Guess what? What your prospective franchisees hear or sense in those conversations could be what gives them cold feet in the 11th hour.
Here’s the ugly truth: many franchisors have terrible images. We have had many franchisors contact us requesting franchise development advice. We have to tell them that before they can worry about improving their sales pitches or recruiting systems they should worry about fixing their image.We've seen franchisors with the most unattractive logos, websites and marketing material. If you’re lucky, you might be able to generate leads but a poor image will more than likely make your prospects extra cautious. Their sense for finding flaws in your franchise system will be heightened.
A prospective franchisee needs to be confident in your abilities as a franchisor as well as in the franchise opportunity. It all starts with an attractive image. If you don’t impress them in the beginning, they will eventually pick apart your entire franchise system. Once their confidence in you is gone and they get to the final step, it’s very hard for them to sign that Franchise Agreement. Having a solid image makes most prospective franchisees more confident about your system.
Spend the money on a professional image by revamping or even redesigning your logo, marketing material, website, office or anything else that your prospective franchisees may encounter.
3. Interest and Responsiveness
It’s amazing how many prospects the best franchise development directors speak with who tell them all about the franchisors they were interested in who never called them back or only called them back 1-2 weeks later. The simple reality is that those prospects are much easier to impress than prospects who come directly to a franchise system, because showing even minimal interest in them is a huge improvement over what they experienced from other franchise systems. As a franchise development director, you should always remember that one of your competitors will gladly be responsive and spend the necessary time with the prospects you foolishly ignore.
Most prospective franchisees are looking for a “good business”. Chances are they didn’t grow up dreaming about wearing plastic gloves and placing cold-cuts on 12” bread. Prospects are pretty open minded to many franchise business opportunities. You will not only be competing with franchisors in your specific niche, you will be competing with every franchisor. If it takes your franchise sales people too long to respond to franchise inquiries, prospects will start working with other franchisors. Initially, your franchise opportunity might have been their first choice but at this point it will probably fall to the bottom of their list.
When it comes to decision time, they will review the franchise opportunities in contention. The one edge that other franchisors will have over you is that they showed more interest in the prospect. That might be all it takes for the prospect to go with a competitor. Prospects tend to prefer the franchisors who showed an interest right from the beginning. Building confidence and a good rapport starts with calling all prospects as soon as the lead comes in. Being supportive in the beginning is a sign of how well you will support them once they become franchisees.
Just remember that the moment that you drop the ball with a prospect another Franchisor will pick it up!