10 Common Franchising Mistakes to Avoid

from Wayne Maillet, President, Franchise Specialists.

With most franchise systems, you will discover that there is often a big variance in success between franchise owners and locations. In many systems there are franchisees that are substantially more successful than others. Other franchisees may be struggling. Why?

What are the successful franchisees doing different?

It may be that they simply have a great location. Often, it is something more. They are doing a lot of little things right and avoiding the common mistakes that tend to happen in business ownership.

To assist you, here are the top 10 common mistakes for franchisees to avoid during the life of your franchised business venture:

1. Not following the franchise system

Often you will find some franchisees that will use most of the franchise business model, but they will modifyit. The rationalization is that their management style is different or their market is different. If you buy a franchise, use the proven system. It has been developed based on years of experience in several different markets. Trust that the model works, or why else would you have bought a franchise? If you insist on doing it your way, be aware you may be violating your agreement and it may be terminated.

2. Underestimating the time commitment

Buying a franchise is a full-time job, especially when you are first starting. You do have a head-start in that you have an established business model with a franchise, but you are still running a business that requires alot of your time. Absentee ownership typically does not work. Most franchise agreements now require that the owner be committed to the business full-time. Make sure you are prepared to dedicate the time necessary to make your franchise business succeed.

3. Not marketing

The misconception is that you acquired a franchise with an established brand so that you don’t have to advertise. Customers will just come to you. This is typically not the case. There is a reason why most franchise agreements require a franchisee to spend money on marketing and advertising. Advertising and marketing works. Products and services don’t sell themselves. And remember, your competitors are spending time and money on marketing and advertising. You don’t want to be losing your sales to them.

4. Not embracing change

Rapid social and technology changes are continuing to impact customer buying patterns. To stay relevant franchise networks are innovating like never before. These ongoing changes can create stress and uncertainty, not only for franchisees, but also for your employees. The good news is that you have the support of the franchisor and fellow franchisees to assist and support you through the changes. You don’t have to deal with change alone.

5. Not setting aside funds for change

The franchise system you purchase is going to change. You will be expected to remodel, to upgrade software, hardware and equipment, and to possibly rebrand the business –all at your own expense. The original McDonalds were a drive up window with a limited menu of burgers, fries and a shake. Compare that to today’s McDonalds. Plan for the future by
saving for long-term capital needs and allowing the business to evolve.

6. Failing to increase operational resources to deal with growth

If you don’t bring on additional resources to support the growth you will plateau and stagnate. You will need to bring on more people, more trucks, or more inventories. Growth often means larger resources. Without this investment in additional resources the business will not achieve its full potential.

7. Trying to do everything

Focus on your strengths and passions and hire your weakness. One person cannot do everything, or if you do, you will possibly burn yourself out.

8. Forgetting about life balance

Don’t forget your family. Work is not everything. Numerous entrepreneurs forget about the wife and kids and end up in divorce. Don’t let this be a regret later in life. Bring on the employees that will allow you to maintain balance between family and work. Take the time to take care of yourself. Join a local gym and exercise.

9. Not participating

Don’t sit on the sidelines. Get involved through the franchisor and network through community events. Go to the franchisor conference. Build relationships with the franchisor and other franchisees. Outside the franchise network, build relationships with your landlord, accountant, banker and employees. All are a part of the team and will be valuable resources to you.

10. Failing to take the time to learn

You are your most valuable resource. Take the time to attend additional training, whether through the franchisor or local colleges. Never stop learning. Provide the same opportunity to learn to your staff so that they may evolve and grow as well. Being in business for yourself can be one of the most rewarding things you can do. It is a big commitment and comes with high rewards.

Learning from the mistakes of others will allow you to avoid the potential landmines and maximize your success and returns on investment.


Wayne MailletWayne Maillet is a leading Canadian franchise management consultant with over 25 years of practical experience in all aspects of franchise operations. Respected within franchise circles, he brings a realistic, practical understanding of business and franchising. Wayne Maillet has spoken across Canada, including lecturing at Queens University, written several articles and is often quoted as an authority in franchising. He mixes practical experience with an academic understanding, having earned his Bachelor of Business Management Degree from Ryerson University and was recognized for outstanding academic achievement in management and enterprise development.

Website: www.franchisespecialists.com

Leave a Reply

Your email address will not be published. Required fields are marked *