8 Things To Learn From a Franchise Business For a Startup

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The biggest bottleneck to growth is the business owner.

One of the most striking observations is that most small businesses are started by “technicians”, that is people who are skilled at something and who enjoy doing that thing. A technician can be anything from a developer to a plumber or a dog groomer. When these technicians strike out on their own, they tend to continue doing the work they are skilled at, and ignore the overarching aspects of a business.

All of the experience, the knowledge and know how are forever trapped inside their head. It’s never enough to satisfy the standards the business owner has set, so in frustration, he resorts back to doing everything himself. Without clear goals and quantification benchmarks, they soon find themselves overworked, understaffed and eventually broke.

In other words, the owner of the business discovers that running a business doing what he or she loves is not what they thought it would be.

So, what can you do about it?

The answer to these problems may lie with the concept of franchising.

Franchises, you either love them or hate them. Seth Godin, see them as a path to eternal mediocrity, never to produce anything beyond “ok”, other love the systems-oriented philosophy of them, the ability to build a well-oiled machine that can be replicated over and over again.

Why not take the best parts of franchising for your business and leave the less desirable parts behind?

1. Work on your business, not in it

If your business depends on you, you don’t own a business, you own a job.

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Most businesses are operated according to what the owner wants (a place to work freely), not according to what the business needs (growth and change).

The solution is for every business owner, especially the technician-owners, to balance their business personalities. Every business owner needs to simultaneously be an entrepreneur and a manager as well as a technician. The technician is the worker-bee, the one who produces the product. The manager makes sure operations and finances run smoothly and consistently. The entrepreneur formulates the goals, and steers the business in the direction needed to reach those goals. Of these three personalities, the entrepreneur is key — without it, the technician will work himself or herself to death or bankruptcy. As the business grows, the business owner will need to draw away from the technician work and a manager work and delegate this work, rather than abdicate this, to others.

2. Provide predictable service to the customer

Give your customer the service he wants systematically, not personally.

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Create a business whose results are system-dependent, rather than people-dependent. Create a system of experts instead of being the expert.

Your product is the feeling of the consumer has when they buy from you, not the commodity you sell. How the business interacts with the consumer is more important than what it sells.

3. Set up operations manual

Build your business as if it was the prototype for thousands of franchises

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Script everything so you can more easily achieve consistent/predictable results, and maintain the agreed-to standard. All important work should be documented in operations manuals. The objective is to write your manual as if it were going to be used by a franchisee.

4. Standardized training

Setup training system for people with the lowest possible skill (not necessarily unskilled, just lowest possible)

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Good training can be exhausting. Often, after you’ve done the same training for several employees, you start to cut corners, leaving out little tid bits of insight that might be crucial for a new employee to “get it”.

A good franchise will have a detailed training manual so the employee hired today is trained the same exact way the employee hired next month will be. The next time you set out to train a new hire, bring along a pad and pen and document everything you do so you can refer to it again for the next hire.

5. Measure your key metrics

Do you know what your KPI’s are?

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Your (KPI’s) are the key metrics that you look to measure of success for your business. It’s a “snapshot” you can look at and get a quick feel if things are going well or if trouble is potentially brewing. Every business has different KPI’s, but everyone has them. Examples of KPI’s are:

  • The number of leads generated each month
  • New customers acquired each month
  • Number of sales calls made each month

Find out what your important metrics are and write them on a whiteboard in the office so you and your team can see them every day.

6. To-do lists for each position

Each job position must have it’s to-do tasks & responsibilities

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Check-lists are common-sense necessary for anything you plan to do at least twice. Get over the feeling these are for idiots; they ensure that they right things are done in the right order.

If someone quits your business — you know what job you will need to cover, how often, in what order.

7. Strong branding

Wouldn’t it be great if people saw your logo and got all warm and fuzzy inside just thinking about their last visit to your shop?

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A strong brand can do that for you. Franchises understand the importance of branding. Every customer touch pointis carefully designed to remind you of who they are as a company and what their brand stands for.

Closing earlier than your posted hours, not responding to customer communications, these are all little things that slowly eat away at the quality of your business.

All of that little “corner cutting” turns into a deterioration of your brand. Keep your branding strong, even if it hurts the pocketbook in the short run.

8. Consistent Marketing

“A man who stops advertising to save money is like a man who stops a clock to save time”

Henry Ford

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Franchises understand that even in tough times, you cannot save money by cutting your marketing budget. This is something independent small business owners do all the time. In tough times, they look to save a few dollars here and there, and it’s easy to not place that ad next month or to freeze your PPC for a month or two. You don’t see the results of you decision until several weeks later, when you realize that the phone has stopped ringing and nobody new is walking through your door.

Never stop marketing. Never lose sight that even if you are busy now, if you stop marketing, the pipeline will run dry.

The well-known failure-rate for a small business: 40% fail in 1 year, of those who survive 1year, 80% fail in 5 years, and of those who survive 5 years, another 80% fail.

In comparison to the dismal rate of ordinary small-business start-ups, 75% of franchises succeed at 5 years. The reason they succeed is that they are set up so that any unskilled person off the street could walk in, buy a franchise, run all operations in the franchise, and have a fairly good chance of success.

Great businesses are built on great experiences. We make those experiences happen. Visit

Written by

Design team lead @ Shift 4 Payments

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