The ability to be selective, based on criteria rooted in the company's culture, allows franchisors to choose the ideal candidates for their franchises. Franchisees and franchisors both interview each other and, at the same time, make a joint investment, but franchisors take on a great responsibility to understand the culture of their own business and the expectations it imposes on any franchisee. This understanding forces them to conduct a mutually beneficial selection process because of their realistic and responsible approach to brand expansion.
Selectivity means that only the most suitable franchisees join the brand, irrespective of their financial capacity. In situations where funding is limited but the franchisee is clearly the ideal candidate, franchisors may choose to use their company's internal funding options to enable the franchisee to open their franchise. These financing programmes enrich the company culture when offered to the right franchisees and work most effectively when focused on quality expansion rather than quantity of locations opened.
The quality of training and the choice of the right franchise location are two other key aspects of the franchise agreement that significantly influence the performance of the franchisee and, in turn, the franchise network. Training can be ongoing and involve regular visits, 24/7 assistance or online programmes. How franchisors manage training, both initial and ongoing, is of great importance to franchisees.
Location selection often involves the availability of a property in the area and demographic research before a final decision is made. The choice of a franchise location usually involves reaching a consensus between the franchisor and the franchisee. A bad location can hurt a good franchisee's business opportunities.
The success of franchising should be considered over the long term, with a focus on sustainable profits over time. This approach excludes rushed openings. It is in the franchisees' own interest that their skills are thoroughly reviewed and assessed, independently of, and alongside, their financial resources.
Franchisees can also assess the importance that franchisors attach to location by asking about the approval process.
- Is the approval process reasonable in terms of length, considering a variety of factors?
- Does it require the consent of several people in different departments of the company?
- Does it remain true to the franchisee's principles and is it a quality control routine that is carried out for each outlet?
All these factors are reflected in the franchise system and its commitment to honesty, as well as in each of the franchise investors.