Why a balanced relationship is key for succeeding as a franchisor, franchisee

| by Judy Mottl
Why a balanced relationship is key for succeeding as a franchisor, franchisee

Photo by iStock.com

The relationship between a franchisor and franchise, whether the business is a restaurant or another type of retail store, is a critical factor in establishing and driving a successful business venture, and so the relationship must be one of balance for both businesses.

One key element in striking the right balance is for the franchisor and franchisee to understand their respective roles as well as the other's. It should be an easy goal to achieve, but as franchisees and franchisors shared during a panel session at the recent International Franchise Expo in New York City it isn't very easy and requires commitment and communication — very much like a marriage relationship.

In fact, viewing the business venture as a marriage is a very good strategy as there is a dating period, a ceremony and then a long-term commitment. That's because a franchisee and a franchisor are dependent on each other, need to share the same level of passion and enthusiasm for the relationship and must instill a give-and-take aspect.

For example, at the School of Rock, a 20-year-old franchise, it's a tribal environment, explained CEO Rob Price, who spoke on the panel alongside a franchisee, Mariola Galavis, who runs two School of Rock franchises in Connecticut.

"We're a community of missionaries building the largest community of creators, musicians," he said, so franchisees must share that vision and approach.

That's why the first question a potential franchisee must answer is "what is my passion," said Gigi Schweikert, president and COO of Lightbridge Academy, who participated in the session along with franchisee Steven DiNunzio, who operates a Pennsylvania-based Lightbridge Academy franchise.

For example, those considering a Lightbridge Academy franchise should love children, love education and the school environment, said Schweikert.

"You really want to connect with people you really want to spend time with," she said, adding a good approach for potential franchises is to spend time visiting operating franchises.

DiNunzio did just that, attending many 'discovery day' events at a Lightbridge Academy to talk with franchise owners, parents and staff.

"You need to evaluate and learn about it [the franchise organization] before you sign on the dotted line," he advised. During the discovery process and the dating period, potential franchises need to learn as much as possible from training provided to finances and marketing.

Galavis noted she had been a customer of School of Rock for three years and knew how it worked well before deciding to be a franchise partner.

Such discovery can be time-consuming but well worth the effort, said the panelists.

"It can be daunting," said Schweikert, but it's invaluable to making the right decision. "You want a franchisor who will help you through the whole thing."

Before signing on the dotted line — just like signing a marriage certificate — you need to know the franchise as well as possible. In addition to spending time at franchises up and running it's invaluable to get legal insight as well as financial insight.

The same is true for the franchisor organization, noted the panelists. In selecting a franchisee, the franchisor must ensure it's going to be a partnership fueled with the same level of passion and enthusiasm as the parent organization.

"Franchising is an opportunity to succeed so you need to start the relationship with honesty, just as if you are dating – tell them about the ex- girlfriend who calls now and then," DiNunzio said, eliciting laughs from the panel audience.

Potential franchisees also need to ask lots of questions before making a commitment. Those questions range from the technology a franchisor uses to site selection services to whether franchisees are active and respected participants in organizational decision making.

"You have to ask all those questions during the evaluation phase," said DiNunzio, adding just as one would do before taking a marriage vow.


Topics: Business Strategy and Profitability, Franchising & Growth

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