Potential franchise owners want to have as much information about a concept as possible prior to making a decision regarding licensing the brand.  As stated in my previous blog, franchisees are a great source of “front line” information regarding the franchise business that you are exploring.  Franchise concepts with a well defined recruiting process require you talk with some of their existing franchisees as you are nearing the end of the discovery process.  Franchise concepts with a less defined recruiting process may suggest you speak with their existing franchisees earlier in the discovery process, and may expect their franchisees to “sell the concept” for them.

Experienced franchise recruiters are respectful and protect their franchisee’s time and privacy.  Franchisees are very busy individuals as they build their businesses while maintaining the proper balance between work, family and other community activities.  Franchise recruiters want to ensure that their franchisees only spend time interacting with qualified candidates.  Often a password is utilized to signal franchisees that you have reached an important milestone in the qualification process, and the franchisee will speak more candidly with you.

No franchisee is obligated to talk to you. If they do so, it is strictly voluntary. If you are awarded the franchise, in the future, potential franchisees will be calling you, so please consider how you would want that conversation to be conducted as you call existing franchisees.  Please remember, the more pleasant you are, the more likely that they will be to talk to you.  Please understand, as you prepare for these calls, franchisees are not required to reveal their earnings to anyone. While they will want to help, human nature is to be relatively private when discussing income and earnings – especially to someone that they have never met before.

Having your questions formulated is key to having a productive validation call.  Consider the following guidelines:

  • Validation provides an opportunity for existing franchisees to meet and evaluate you as a potential franchisee. Franchisors will seek feedback from their franchisees so please make sure these conversations reflect you at your best.
  • Please respect their time and keep the conversations to a length of approximately 15-20 minutes. In order to address the points that matter most to you, please keep your list organized and in order.
  • Ask questions that build on the knowledge that you have already learned in the discovery process.
  • You should avoid questions about the Franchise Disclosure Document (FDD) and Franchise Agreement. While these are very critical documents, most franchise owners will not remember the content as the FDD typically collects dust on a shelf after operations are launched.

As you see from the guidelines, beginning the validation process prematurely may be detrimental and unproductive for both you and the franchisee.   The vast majority of  franchisees will be willing to schedule a time to talk with you, but they are very busy managing their businesses.  Work with your franchise recruiter to ensure this process is handled properly.  Your recruiter should have some basic guidelines and information that will take you through the process and make it both informative and enjoyable.

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Have you considered or are you embarking on the path of franchising?  As franchise candidates move through the process of selecting the right concept for their endeavor, often they request, or are required by the franchisor, to speak with Franchisees for the “validation” process.

Franchisees are a great source of “front line” information regarding the franchise business that you are exploring.  As you are considering which franchisees you would like to speak with, do a little soul searching, be realistic with yourself and determine what you truly want to learn from these people.

Pessimists are typically looking for Franchisees that are struggling or who have failed in the past.  Are they looking for reasons not to enter the business, or perhaps they are looking for guidance that will keep them from making the same mistakes.  By doing this, they are aligning themselves with underachievers.  Human nature for underachievers is to look for some one or some thing to blame for their under performance, and typically aren’t following the systems of the franchise.

Optimists are typically looking for mid level to top performers.   The optimist is looking for secrets of success and is looking to mimic the results of the successful.  They want to align themselves with people of similar traits and characteristics.  They are looking for a mentor, a wise and trusted counselor or teacher who will help them rise to success.  Successful Franchisees are proud of their accomplishments, are leaders in the franchise community, and typically have a proven track record of following the systems of the franchise to top.

Franchisors should encourage you to speak with a wide range of individuals in their system so that you are truly validating the business.  Keep in mind however, establishing rapport with top performers early in the process of franchising may allow the opportunity for a mentoring relationship that can help you to be successful.

I recently read an article by Anita Campbell in which she spoke about the demographics regarding people who are entering the world of business ownership and franchising.  There were some eye opening facts regarding the ages of first time entrepreneurs.

Anita quoted statistics from a November 2009 Bureau of Labor Statics study that showed, “The incorporated self-employment rate is four times higher among those aged 65 to 69 than among those aged 25 to 34—and a whopping 25 times higher than among those aged 20 to 24.”

There are a number of reasons this may be taking place:

  • Investing may be easier with the utilization of built up retirement funding
  • With grown children, the ability to save and gain necessary capital for start-up may be easier
  • Lay-offs – higher paid senior executives were greatly impacted during the economic down-turn – rather than going back into Corporate America, invest in yourself and your skills
  • Nearing retirement age, but still having the desire to contribute
  • Empty-nest syndrome – many mothers have more time on their hands and the ability to take charge of their time – with the battle to gain employment being an uphill one for many stay-at-home moms, starting a busy may be much more plausible

If any of the above scenarios sound familiar, I suggest you read the entire article, and perhaps consider franchising as an option.

When considering a franchise opportunity, you may want to think outside the box.  Often people looking at business opportunities search inside their current skill set or trade.

Carpenters look at construction related franchises, electrician looks at franchises in the electrical field, etc.  Consider the other experience you  have and think of how you could utilize that in almost any field.  You may have sales experience, marketing experience, management experience, etc. and none of these skills are “field” specific.

Grady Barnard began to look for opportunities outside his field and shares his experience of getting into the franchise arena below.

“Hi, my name is Grady Barnard.  I am in the Technology field with a great company, but wanted to diversify my income, so after looking at several opportunities decided to go with the Squad. In the end I feel as if this opportunity will give me financial freedom and a better quality of life for my family.

After looking at several opportunities, I decided on Mosquito Squad for several reasons:

  1. Initial Investment
  2. A true need in our area, plus the ability to help others enjoy the outdoors as I do – Mosquito Free
  3. A company (OLB) that has been around for a while with other successful franchise opportunities

So far the company has been a great help getting us started – I think what closed it was the fact they do not take everyone who has money to spend. You go through an evaluation process to determine:

1. if the opportunity is right for you

2. if you are a good fit with the company.

That was big in my mind.  I am looking forward to a big season in 2010.”

As you have read, Grady decided to think outside the box and consider utilizing his skills in an unrelated field to reach his goals.  With the right mind set, the sky is the limit with franchising.

As you begin your quest to learn more about business ownership, do your homework, and know the rules of the game.  When you are considering franchise opportunities, remember that the Federal Trade Commission has set forth many rules and guidelines that franchisors must follow to remain in compliance.

As a Franchise Recruiter for Outdoor Living Brands, I hear stories of interactions my candidates have had with other franchise opportunities.  Typically, when the first question I receive from a candidate is “How much money can I make”, I know they are either testing me and my credibility, or they may not have worked with ethical franchise professionals in the past. 

As per Federal Trade Commission rules, there is only one legal way to answer that question as a franchisor.  Franchisors may include an “earnings claim” in their Franchise Disclosure Document (or Unified Franchise Offering Circular), but must have the historical data required to verify the information being disclosed.  This “earnings claim” is found in the Franchise Disclosure Document as an “Item 19”. 

Most franchise concepts do not have an Item 19 in their Franchise Disclosure Document.  Perhaps the historical data isn’t available, the information does not put the franchise’s performance in a good light, or they are simply not comfortable providing that data up-front.  If you are looking at franchise concepts, and hear claims of “100% success rates” or “our franchisees make a lot of money”, etc., buyer beware – if you can not find this information documented, it may not be accurate.  Ask the franchise concept if their Franchise Disclosure Document contains and Item 19 – and if not, why?

Outdoor Living Brands currently works with franchise candidates of Archadeck, Mosquito Squad, and Outdoor Lighting Perspectives.  Each of these concepts offer an Item 19.

As a Franchise Recruiter with Outdoor Living Brands, a common reason people give for looking at franchise opportunities is they want to have more time to do the things that are important to them.  Recently I had the pleasure of working with Kendra and John in their quest to take control of their future and their time.  Below is Kendra’s story.

 “My name is Kendra and I have worked in environmental engineering consulting for the past ten years.  My partner, John, is a civil engineer who works mainly in construction management.  As we started looking at our future together we focused on incorporating each of our individual goals into our goals as a couple.  While my goals were more family oriented and wanting to control my own time and career development, John has always wanted to own his own business.  We decided to start exploring different business opportunities and took a short seminar on franchises to learn more about them, thinking maybe 5 years down the road we would start something.  We started working with Entrepreneur’s Source and were put into contact with several different franchises.  Mosquito Squad was very interesting to me especially since one of my summer jobs in college was with the Baltimore County Department of Agriculture, Mosquito Control Division, driving one of the spray trucks around.  The more we learned about Mosquito Squad and Outdoor Living Brands the more we liked them.  Although we didn’t go into the process with any kind of expectations, or even thinking we were going to buy a franchise, the opportunity was so great that we couldn’t let it pass us by.  The investment level was very reasonable and we know Annapolis has lots of mosquitoes!

 We signed up in September, completed training in December, got our first customer in March and will be heading out to do our first spray next week.  The whole process has been great.  There is stress involved, but the people at Outdoor Living Brands do their best to help you in any way possible.  John and I both work our full time jobs and plan on hiring people to work at Mosquito Squad once we have enough customers.  Coming from a science background I have had to learn a lot about business, accounting and marketing.  It takes up almost all of our free time but we hope the reward will be worth it.  It has made us work together as a team and allowed us to experience the joys and pains together.  We are looking forward to a great season and our excitement about Mosquito Squad is the same now as it was on Confirmation Day.” 

Take control of a precious commodity, your time and your future.  Consider franchising as a way to facilitate reaching the goals you have set for yourself and your family.  Starting your own business is not the easiest of tasks, but with the help of a support team to pave the path, you could be on the way to success quicker than you may think.

“I’m waiting to see what happens with the economy.”  As a Franchise Recruiter for Outdoor Living Brands, this is a common reason people state for not starting their own business and taking control of their own destiny.  “I would love to be my own boss, but what if . . .” Step back for a moment and ask this question – “Am I looking for excuses or answers?”

Does fortune truly favor the brave?  Entrepreneurs thrive on challenge and seek the positive attributes of any situation.  Consider the businesses that were started during a recession or depression that have thrived . . . Hewlett-Packard, Sports Illustrated, CNN,  GE, IHOP, Microsoft, Burger King, Fed Ex, MTV, Hyatt Corp, the list goes on and on.  New opportunities are born each day, even during tough economic times, but only those “brave” enough to view the economic situation as a positive will make that first step toward owning their own business.

 All businesses face challenges.  One challenge that has caused many companies to fail is the lack of planning.  We hear of companies that were lax in their spending, controls, systems, analysis, and structuring.  With companies having to “tighten their belts” many people are caught in the pinch.  When you start a business or are nurturing it through the infancy stage, your attention to detail and the key systems of your business is exceptionally strong.

Whether you are looking for a job or starting a business, you will face challenges.  Now add the ability to utilize many years of experience in developing, implementing, and monitoring systems to your arsenal.  Perhaps you are thinking “I don’t have many years of experience, and little or no exposure to those things.”  Franchising allows you the ability to have that experience and knowledge at your finger tips.    Put your determination, abilities, and drive to work for you.  Consider franchising as a way to start your own business.