Buying a Franchise

New Survey of Franchisors

Online marketing leader Yodle’s new survey of franchisors provides some insights into what franchisors want for those who want to become franchisees.

What franchisors want? That may not be top of mind for you as you look for the best franchise business opportunity. You are probably focused on what you want. That’s natural.

But knowing where franchisors feel dissatisfaction can give you some valuable clues about how best to develop your relationship with the franchisor you choose. Strong, positive franchisor/franchisee relationships matter in any franchise business.

What’s more, franchisor complaints, just like franchisee complaints, can give you a better understanding of where things can go wrong and how to keep them going right.

Here are the key findings from Yodle’s survey.

Franchisors want more control.

This might be surprising, in view of the dramatic discussions going on over the question of whether franchisors should be considered joint employers with their franchisees. however, the vast majority of franchisors don’t think they have much control over franchisees at all. Fully 91% of the franchisors surveyed said that they don’t have enough input into their franchises.

21% of the franchisors surveyed say they have no influence at all on their franchisees’ marketing or the day to day operations of the businesses. 70% said they have some influence but not as much as they want.

The areas in which franchisors wanted more influence were these:

  • advertising spend
  • brand/messaging
  • reputation management
  • business practices
  • customer relationship management

In other words, franchisors want successful franchisees who support the brand, take good care of their customers, and invest in marketing. That leads to profit for franchisees… and therefore for franchisors as well.

Franchisors want more information.

Franchisors also want to know more about what’s going on. 93% of those surveyed want to know how their franchisees are spending their marketing funds. This overlap with the desire for more input makes sense. Marketing is one of the major topics in franchisee complaints, too, so it’s apparent that this is an area in which franchisors and franchisees don’t see eye to eye and perhaps aren’t listening to each other very well.

Only 6% of respondents have an automatic system for getting marketing data from franchisees. That means that 94% have to rely on voluntary reports from franchisees — and perhaps it’s not a coincidence that 93% don’t feel that they get enough information.

Franchisors want more franchisees to follow best practices.

Franchisors also express frustration with franchisees who don’t follow the system. While franchisees know that following the system is part of the deal, it’s human nature to think we can improve the system — or to cut corners on that system. Franchisors want to be able to enforce the agreements, but may not be able to gain the kind of oversight they need to identify franchisees who need help to get back on track.

Franchisors shared their goals for the coming year with Yodle.

  • 94% wanted to build their franchise revenue
  • 77% wanted happier franchisees
  • 71% wanted more franchises.

Nearly half of the franchisors worry that they won’t be able to meet these goals because of the problem of franchisees who don’t follow the system. Clearly, compliance is really on franchisor’s minds.

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