Successful entrepreneurs are not ordinary people. Indeed, you should know that only 3% of the population is an entrepreneur, and you know full well that success is not for everyone.
Most successful entrepreneurs that I know believe the following 3 myths about franchising.
Myth 1: Franchising is a “cheap way to raise capital”, so it’s not solid.
A franchisor can indeed create significant capital without investing an amount equivalent to that of all its franchisees to develop a similar business of this magnitude without franchisees. This does not mean that it is not solid. Where entrepreneurs are wrong is about the strength and resilience of a franchise network, in addition to its excellent ability to minimize risk. It must be understood that each franchisee is an entrepreneur who assumes their own risk and that the more franchisees you have, the more you divide the risk. These tens, hundreds or even thousands of companies form a tightly woven web within a network that can withstand many hardships.
Myth 2: I can’t do what I want when I want because franchisees don’t want to know anything.
Indeed, if you do not know where you are going and are the type to change your mind often, franchising is not for you. A franchisee is not an employee; he/she is a business partner. The recipe for success is to do what must be done (not what you want to do) to create value for 1. Your customers, 2. Your franchisees, 3. You, and lies in creating a culture of “us” for everything.
Let me explain, becoming a franchisor means being convinced that your success depends on the success of others, and you cannot do it alone. This culture of “us” for everything implies an ability to plan, communicate, decide, and manage in a fluid, changing world with business partners that simply do not always have your degree of business skills or your opinions. “Teamwork makes the dream work”, let’s not forget that.
Myth 3: There is no “exit strategy” in franchising
This one is not only false, but in reality, it is proven that the economic value paid to acquire successful franchise networks is exceptionally high. Remember that as a franchisor, you sell “guaranteed” future income and an ability to develop without additional capital on the buyer’s part, and a minimal business risk since several franchisees share the risk. In addition, never lose sight of the fact that the initial investment you made to become a franchisor was undoubtedly not huge. But there is a but.. DAMN! Success lies in the quality of the relationships with your franchise partners, contractual agreements, repetitive revenues, branding, and systems. If you do not have a quality franchise network, the myth becomes a reality. BAM!
Only successful entrepreneurs who possess well-developed human qualities can succeed in franchising and developing powerful brands that create value for the entire ecosystem. No need to play the superhero. You just have to stay humble and develop lively, strong and compassionate partnerships with franchise partners. The others take nebulous paths taking with them disillusioned franchisees, not joyful as a scenario, to say the least.
Okay, disagree, let me know! (Comment, this feeds the debate)
And if you encounter issues that you would like to discuss with an expert who knows your reality since I have lived it as a CEO, I would be more than happy to do so.
Contact me privately for a free strategic brainstorming session!
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