Franchise Strategy Development: What You Need to Know

Practically any franchise brand has room to grow. It may be your marketing or something deeper, but there is always something that should be changed in an ideal world. A franchisor who thinks they've got it perfect is going to stagnate.

Of course, there are two sides to this equation. Change too quickly or in the wrong way and it could seriously backfire. A franchisor needs to evolve, but not so rapidly they can't adjust for error.

This is the true nature of franchise strategy development. It is the balancing act between making progress while avoiding making bets you can't afford to lose right now. Join us for advice on how to best tailor your own strategy to your franchise brand's needs.

Figure Out Why People Should Care

There's plenty of money to be had franchising, with billions of dollars flow through franchises each year. However, that also means you're facing a ton of competition.

Making people care about your particular brand is pretty critical to success in this business. If you're a restaurant franchisor, you don't just need to make your target demos want to run restaurants. You want them to run your restaurants.

Much of this will naturally develop out of the nature of being a franchisor. You'll want a clean, unified brand, so the customers an individual franchisee serves can have a positive, similar experience at a different franchisee's establishments. 

Why? You want a good reputation and one that's easy to market.

If you can show multiple examples of franchisees following your outline and seeing success, that's a strong pitch. If your brand seems like just a name, with franchisees having to figure a lot of the hard details out themselves, it's a much harder sell (even if your name still demonstrably can attract customers).

Find Your Weaknesses, Correct Your Mistakes

One risk you run into when your franchise brand starts to see success is becoming arrogant. It's easy to grow blind to weaknesses and mistakes when money is coming in. However, this arguably the time where it's most critical to be smart.

There are plenty of easy mistakes franchisors tend to make, especially early on. Many try to grow too quickly, cutting corners along the way. If you want to survive major economic changes (like if a pandemic hits, for instance), you're going to need to ensure you are on solid foundations.

Luckily, it's usually possible to adjust course if you take the time to self-examine. Your development strategy should focus on sustainability. 

Not attracting enough franchisees? Your agreement may be too strict, or maybe you need to reexamine how you're marketing yourself.

Starting to develop a negative reputation? Maybe your agreement isn't strict enough; franchisees may be playing too much with your formula. It could also mean your training program needs to be adjusted or even something more core to your model needs shifting.

Get-rich-quick-schemes aren't generally the way to big bucks; they're the way to catastrophic failure. Find the tiny problems every business has around and stomp them before they grow into potential disasters.

This is absolutely a step where professional help like that offered at SFD can help. Hiring proven experts to identify both your strengths and weaknesses can make sure you catch potential issues early, all while using all your strengths to your advantage.

Learn From Your Competition

Your competition is an invaluable resource for bettering your own business. Sure, it's still usually better if they didn't exist. But since you probably don't have the power to drive them out anytime soon, start learning from them.

Do you know who else is in franchise development? Your competition. They're trying to master (generally speaking) the same markets you are.

The trick is figuring out whether their strategies have anything to offer for you. Even businesses in the same industry and location may require different approaches to succeed. Moreover, sometimes your competition will even make decisions that are flat out wrong. 

One good place to start is looking at obvious failures. Try to find out if any franchise brands similar to yours have failed in significant ways among your target demographics. This is can be an incredibly valuable well of information.

You aren't only looking for brands that were downright killed either. Any kind of big flops, controversies, and other negative press is worth your attention. Learn from these expensive mistakes so that you never make them yourself.

Then you can start seeing what information you can pull from your successful competitors. Try and examine how they managed to pull in the type of numbers they're seeing. What are they doing differently than you? 

Just remember that your competition may have access to resources you don't. To give an obvious example, you literally can't copy many of the plays McDonald's are making. They can afford huge losses that only payoff much later in ways you almost certainly cannot.

Your Franchise Strategy Development Should Always Be Evolving

If there is one take away from the above, it's that you should always be learning. Information is power when you're a franchisor. Learn how to look at both your competition and yourself for new ways to grow.

Just remember that not all information is equally important. Your growth should be deliberate, not reckless. The best development strategies leave some room to step back if a change isn't having an effect that justifies its expense.



If you have an interest in getting some professional help with your franchise strategy development, we hope you'll consider SFD. Our franchise development experts are masters of looking at a franchise brand and helping to identify exactly how it might be able to grow. If you're interested in more information, contact us today!