Franchising: February 2007 Archives

Recently I interviewed Flo Schell, Sales and Franchising Coach about the advantages and disadvantages of buying a franchise business.

After talking with Flo I got to thinking, if someone is interested in buying a franchise how do they find out what’s out there? So I phoned Flo to ask her about options for people interested in buying a franchise business.

As always, Flo was tremendously helpful. She explained that there are so many great franchising opportunities. Ones that came immediately to mind for her were Kabloom, which is a flower franchise, and Rocky Mountain Chocolate, which is a franchise chocolate shop. And of course, in Canada, Tim Horton’s coffee shop is a huge franchise.

Flo stressed that although there are many good food franchises (some of the biggies that you'll recognize are McDonalds, Wendy’s and Pizza Hut), franchise businesses are not limited to the food sector. Just about any service or product can be franchised if it’s something that the market wants.

And an important consideration is not to forget about local "home-grown" franchise businesses. I’m thinking of my favorite local coffee shop called Serious Coffee. This is a franchise that’s just on Vancouver Island where I live, so it’s in a fairly small geographic area. It’s not even province-wide or country-wide, never mind international.

But it started off about 10 years ago, one outlet down near Victoria and they have done things right. Because they ran that for about 7 or 8 years and got a really good reputation, and then they started franchising. Gradually you saw one open up in the next town and then the next town from that. And now, they’re up here in my town, and I love them.

Here's the transcript of my interview with Flo Schell, Sales and Franchising Coach about buying a franchise business:

Barbra: When someone is looking to start a small business, there’s lots of different options. They can start a business from scratch or they can buy an existing business or there’s buying into a franchise business. Could you explain exactly what a franchise business is and what makes it appealing?

Flo: Yes, I’m happy to. Franchising in my mind is one of the best models available for building a business. And, I say that because franchising creates a partnership between a parent company, or the franchisor, and that’s spelled f-r-a-n-c-h-i-s-o-r and individuals in different locations who are known as franchisees. So, you have the best of this big company resource with the smart location knowledge that a franchisees brings to the partnership.

Barbra: And so, the advantage of buying a franchise is that things are already in place?

Flo: Well, you are buying a proven model, yes. So, there is a model of the business that you’re buying that has already been in place and documented. And, in fact, the franchisor will have figured out systems that work for that business model, a marketing plan, accounting plan, financial programs for that business. All of that will have been completed and at least you know that that business is vital and operating somewhere and the franchisor believes it is replicable in other places in the country or abroad.

Barbra: I suppose from a marketing point of view one of the advantages is that there’s a recognizable name.

Flo: Absolutely. That is one of the biggest advantages, because when a customer is looking for a service provider they are more likely to approach a company that they’ve heard of before. They feel more comfortable doing that than approaching a company in the Yellow Pages that they know nothing about.