{"id":20565,"date":"2016-08-31T16:31:46","date_gmt":"2016-08-31T16:31:46","guid":{"rendered":"https:\/\/www.thefranchiseking.com\/?p=20565"},"modified":"2022-04-11T13:05:16","modified_gmt":"2022-04-11T17:05:16","slug":"franchisors-stop-using-this-word-recruit-new-franchise-owners","status":"publish","type":"post","link":"https:\/\/www.thefranchiseking.com\/franchisors-stop-using-this-word-recruit-new-franchise-owners","title":{"rendered":"Franchisors: Stop Using This Word To Recruit New Franchise Owners!"},"content":{"rendered":"

\"franchisors:<\/p>\n

I was under the impression that when I got older, two things would happen.<\/p>\n

1. Stuff wouldn’t bother me as much<\/p>\n

2. I would mellow with age<\/p>\n

So far, I’m zero for two. <\/em><\/p>\n

One reason: The industry I’m in that continues to aggravate me at times. Like when certain franchisors<\/a> insist on using a certain word to recruit new franchise owners. A word that’s very disingenuous-as you’ll soon see.<\/p>\n

Keep reading to find out what that word is, and why franchisors need to stop<\/a>
\nusing it.<\/p>\n

 <\/p>\n

In Franchising, New Franchise Units Must Be Sold<\/h2>\n

A franchise business<\/a> system with lots of franchise units is a site to behold. Especially if it’s a great one.<\/p>\n

In addition, the hundreds (or thousands<\/em>) of franchisees in the system are busy, they’re making money and they’re happy. Plus, they have buying power-which enables them to have leverage with vendors for better pricing because of their size. Good stuff!<\/p>\n

When the business is a busy, successful franchise operation, the team at franchise headquarters is busy too. They’re supporting the franchisees. Things like on-site visits are happening. Problems are being solved. And, money is being made…as the royalty<\/a> income from their busy, high-revenue producing franchisees is steady.
\n 
\n\"image<\/p>\n

A Cash Explosion: Royalty Income<\/h2>\n

If you’re thinking about buying a franchise<\/a>, it’s important<\/del> crucial to know how the math works in franchising-on the franchisor side. Check this out.<\/p>\n

\"disaster<\/p>\n

Classy Cleanup<\/strong> (a fictitious name<\/em>) is a franchise business that’s in the business of cleaning; specialty<\/em> cleaning. Their franchisees handle things like water damage and smoke damage from fires etc. that hit homes and businesses, along with mold-removal and other assorted nastiness.<\/p>\n

The company supports 325 franchise owners. Business is good<\/em>. On average, franchisees are doing $65,000 a month in revenue. (Almost $800k annually<\/em>)<\/p>\n

Furthermore, Classy Cleanup franchisees are required to pay 5.5% of their revenue (their royalty<\/em>) to franchise headquarters every month.<\/p>\n

That means on average, each franchisee sends in $3,575<\/strong> each and every month to headquarters.<\/p>\n

Let’s Multiply<\/h3>\n

Now, let’s multiply that figure by the number of franchisees in the Classy Cleanup franchise system.<\/p>\n

375 franchisees X $3,575 = $1,340,625.00<\/p>\n

That’s right: Classy Cleanup collects $1.3 million every month-in royalties<\/strong>, from their franchisees. That works out to $16 million annually<\/strong>. Not bad.<\/p>\n

That’s why lots of people want to “Franchise<\/em>” their businesses. It’s also why franchise CEO’s love seeing a lot of new franchise units sold. I’m good with that. As long as:<\/span><\/p>\n

    \n
  • Territories aren’t being stuffed (oversold<\/em>) with too many franchisees<\/li>\n
  • Franchisors are only awarding the best of the best franchise candidates<\/li>\n
  • Franchisors are being transparent and ethical in their dealings<\/li>\n<\/ul>\n

    “I like to think of sales as the ability to gracefully persuade, not manipulate, a person or persons into a win-win situation<\/em>.<\/p>\n

    \u2013 Bo Bennett<\/p><\/blockquote>\n

    Do you agree with that?<\/p>\n

    I do.<\/p>\n

    Which leads to why I’m aggravated<\/del> so mad.<\/p>\n