Category Archives: Franchise Operations

4 Things Franchises Can Teach Independent Business Owners

While running a franchise and running an independent business are two sides of the same coin, there are many differences between the approaches that each take, and each can learn from the other.

Here’s what the independent business owner can learn from franchisees.

4 Things Franchises Can Teach Independent Business Owners

1. Having Processes Makes Work Streamlined.

How the two types of businesses approach work is markedly different. On the independent side, entrepreneurs must create their own way of doing things, and without documented processes, this strategy may eat up a lot of time and make it challenging to train new hires.

On the franchise side, there are processes for everything from opening a franchise to completing a customer transaction. It may seem overly complicated to have so many processes and procedures, but having everything outlined actually makes it incredibly easy to replicate success at any store, as well as train new hires.

The Lesson: Entrepreneurs, take heed. It’s worth taking time to document how you complete a transaction or task. Then, when you need to train someone new, they can read the process and walk through it, step by step.

2. Do What’s Proven.

The thing that’s so appealing to new franchisees is buying into a tried-and-true brand. You already know that McDonald’s is a successful brand; investing in a franchise is pretty much guaranteed to thrive.

The Lesson: Independent business owners often spend a lot of time experimenting to figure out what works. But there’s a saying: don’t reinvent the wheel. Sometimes mimicking the success of another brand can mean profit for your brand as well.

3. Do One Thing Well.

You don’t see many franchises that try to combine industries or products. For example, you won’t see a Bath & Body/Kentucky Fried Chicken franchise! Every franchise company has zeroed in on the products or services that it can excel at.

The Lesson: Entrepreneurs sometimes diversify a bit too much in an effort to reach a wider audience, but the lesson is in finding your niche. Do one thing really, really well. Don’t try to be all things to all people.

4. Hire the Right People.

Few franchises are one-person shows. Most have a staff that keeps the business moving. Often, however, entrepreneurs feel the desire to “do it all” themselves. They think that they’ll save money and be more productive if they take it all on, but that’s rarely a successful strategy.

The Lesson: Hire help. You’re good at doing some things in your business, but not all. Your brain power should be reserved to work on strategizing to grow the business, not doing things like stocking the shelves and checking out customers.

Franchises have it all figured out … or nearly. At any rate, entrepreneurs and independent business owners can learn a lot from franchisees!

Image: Photospin

What Does the Trump Administration Mean for Franchises?

No matter how you feel about our current President, as a franchise owner, you’re probably wondering what changes are in store that will affect how you do business. While President Trump has been anything but predictable in his first weeks in office, we have a few speculations about what’s coming up for franchises.

What Does the Trump Administration Mean for Franchises?

1. Loosening Up of Tight Employment Regulations

Franchises have understandably been concerned about the implementation of a joint employer standard. Essentially, both franchisors and franchisees would be liable for interactions with franchise employees, which puts a lot of pressure and risk on the franchisors. No one is happy about this.

But there is a buzz that President Trump may loosen the reins on this regulation, as well as  the Department of Labor’s new overtime rule. Both could make franchises a little happier.

2. Tax Cuts Put Money Back into Franchises

While, as of writing this post, Trump’s proposed tax cuts haven’t been fully revealed, they are drastic. Paying less in taxes would allow franchises to put money back into the business, hire additional employees, and grow their franchises faster.

And if Trump has his say about the tax cuts, the middle class will have more disposable income. That means they will have more money to spend on goods and services (including those that franchises offer). So tax cuts means franchises can boost sales!

3. Immigration Reform Might Affect Hiring

If your franchise has hired immigrants in the past, that might change, depending on how Trump’s proposed immigration regulations go. It’s anyone’s guess at this point, but if it’s a concern of yours, keep an eye out to see what happens.

4. Business-Friendly Environment Will Foster More Franchises

We know that Trump is pro-business. We may never have had a President quite so savvy about the business landscape, and that could be a good thing for all franchises and entrepreneurs. I think it’s fair to assume that there will be many changes in the Oval Office in favor of businesses, which could boost the US economy.

5. Banking Regulations May Get Breathing Room

Franchisors have long been stressed about the extreme regulations in banking that have made getting funded for franchise systems very difficult. In his first few weeks in office, President Trump has already made moves to scale back the Dodd-Frank Act, which is known for creating more stringent rules regarding bank capitalization (that is, the amount of money that banks must have on hand), increasing compliance and reporting standards for banks, introducing stricter mortgage requirements, creating the Financial Stability Oversight Council (FSOC) and the Consumer Financial Protection Bureau (CFPB), and curbing excessive risk-taking and the existence of too-big-to-fail institutions on Wall Street.

Easing up on these regulations will make it easier for individuals to find financing for franchises.

Only time will tell how much the Trump administration contributes to the franchising industry through his various initiatives. Here’s hoping they’re in our best interest.

Image: Photospin

Are Franchise Fees And Expenses Tax Deductible?

It’s everybody’s favorite time of year: tax time! [Collective groans from the audience.]

In reality, nobody loves tax season. It’s a head-scratching time of year, and entrepreneurs and franchise owners alike always have plenty of questions that relate to their taxes. For example: do you know which of your franchise expenses are tax deductible? If not, keep reading to educate yourself (and maybe pay a little less this year).

Are Franchise Fees and Expenses Tax Deductible? Continue reading

Millennials and Franchises: What You Need to Know

Forget Baby Boomers. The demographic that is quickly forging its own path in the franchise world? Millennials.

Millennials, aged 18-34, now outrank the number of Boomers on the planet. And their numbers are turning up in an interesting place: as franchisees. We’re seeing an increase in the number of franchises run by Millennials, and it’s nothing but good for those businesses.

But Millennials are a breed of their own, and make their own rules when it comes to how they run their franchises. Here’s what you need to know about the Millennial franchise owner.

Millennials and Franchises: What You Need to Know Continue reading