It takes time and effort to make a franchise successful. So why aren’t many franchisees ready to do the time?
Few people throughout history have been as prolific as Thomas Edison. During his 84 years on this earth, he invented the alkaline battery, the first commercial electric light and held 1,091 other patents. The key to his genius was, according to Edison himself, 1% inspiration and 99% perspiration. While the same applies to businesses, franchisees fortunately don’t have to experience a light-bulb moment. Instead, they can put all their effort into developing their business. But worryingly, some people are seemingly unwilling to apply the amount of energy required to be truly successful.
By no means am I alone in having noticed this. I’ve met many a franchisor during my time who loves the franchising industry for the same reasons I do and who has also experienced the same problems I have. An issue that continually crops up is why franchisees aren't trying hard enough. All of us franchisors are left asking each other why they aren’t making the effort. Why aren’t they putting their blood, sweat and tears into their enterprise?
These questions become even more acute when one considers the fact that almost all franchise agreements contain clauses that relate to the responsibilities of both the franchisor and the franchisee. Invariably, the franchisee agrees to use their best endeavours to fully develop the business in their designated area. Most do this with huge enthusiasm and determination, happily contributing that valuable 99% of perspiration required to grow a thriving business. Sadly a few don’t.
Recognising that there are innumerable reasons for this, I still think that a common reason is that the franchisee has simply reached a point where they've achieved their desired level of earnings and don’t want the extra responsibility of developing a larger business. Trust me, I’ve seen this happen on numerous occasions.
While this attitude is absolutely understandable, it can prove to be quite problematic for the franchisor. When this happens, it can result in suppressed income from the franchise, which is especially worrisome if the revenue is earned from a percentage of the sales turnover of the franchisee. Moreover, if customers cannot receive a service locally it can tarnish the brand’s reputation nationwide and jeopardise national contracts.
Needless to say, there are clear considerations franchisors have to make before allowing people into their networks. Similarly if you are considering buying a franchise of your own, it’s worth asking yourself if you are really willing to commit the necessary effort to take on the challenge and make a success of the sweat of your brow.