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Tag: Franchises

  • Bad Day? Domino’s Is Giving Away Free ‘Emergency Pizzas’ | Entrepreneur

    Bad Day? Domino’s Is Giving Away Free ‘Emergency Pizzas’ | Entrepreneur

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    Sometimes, when you’re having a bad day or going through a tough time, indulging in your favorite, greasy comfort food seems like the only thing that will offer any (albeit temporary) solace.

    That’s why Domino’s Pizza is offering customers an “Emergency Pizza” program and giving away a free, medium-sized two-topping pizza as a “pick-me-up.”

    “There’s a lot of uncertainty in the world right now and we know Domino’s customers could use a pick-me-up,” the company said in a release. “And there’s not much that can help brighten a bad day like pizza. Which makes free pizza even better. Or, as we like to say: when life gives you lemons, Domino’s gives you free pizza.”

    Related: Elderly Domino’s Driver Falls During Delivery, Goes Viral

    In order to qualify, customers who place a Domino’s order online for delivery or for takeout will get a free pizza credit for use within a 30-day period. The deal will live in the Domino’s Rewards portal under the “My Deals and Rewards” section.

    The deal will run from October 9 through February 11, 2024.

    Domino’s is coming off of an interesting Q2 2023 where global retail sales grew by 5.8% quarterly, but revenue decreased 3.8% in Q2 from what it was at the same time last year, something the company attributed to lower order volumes among other supply chain factors.

    The company hit record sales numbers in 2020 during the pandemic when Q3 2020 sales were up 24% from the same time period the year prior.

    “We are executing our plan to restore delivery growth in the U.S.,” Domino’s CEO Russell Weiner said in a statement at the time. “Our efforts to improve service and staffing while driving value and innovation will continue to make a difference in driving order counts in this important part of our business.”

    Related: A Domino’s Worker Is Going Viral After Giving a Sweet Surprise to a Customer When No One Showed Up to Her Birthday Party

    Earlier this summer, Domino’s announced that it would be partnering with Uber Eats to increase delivery volume and reach a wider array of customers. The program is launching in four pilot markets in the U.S. this fall and is expected to reach all markets nationwide by the end of this year.

    Domino’s was up just over 15% in a one-year period as of Tuesday morning.

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    Emily Rella

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  • Judge Dismisses Wendy’s, McDonald’s Burger Size Lawsuit | Entrepreneur

    Judge Dismisses Wendy’s, McDonald’s Burger Size Lawsuit | Entrepreneur

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    A lawsuit against Wendy’s and McDonald’s, alleging that the companies had exaggerated the size of their burgers in advertisements, has been officially dismissed by a federal judge on Wednesday, The New York Times reported.

    The plaintiff, Justin Chimienti of New York, had initiated the lawsuit in 2022, claiming that he purchased burgers at Wendy’s and McDonald’s locations, but they were significantly smaller than depicted in the ads, and he was “financially damaged as a result.”

    Judge Hector Gonzalez of the U.S. District Court for the Eastern District of New York ruled that there was no evidence to suggest that the fast-food chains had served smaller burgers than what they advertised or that they had deceived their customers as the lawsuit contended.

    In the 19-page ruling, the judge also expressed doubts about whether Chimienti had actually seen the specific ads for the fast food items which he had cited as examples in his complaint.

    Related: Jack in the Box Employee Shoots at Customer Over Alleged Missing Curly Fries, Family Files Lawsuit

    Chimienti argued that misleading advertising harmed customers by providing them with food of lower value than what was promised.

    While the monetary damages Chimienti sought in the lawsuit are unspecified, he aimed to “fully compensate” individuals who felt “deceived” after purchasing an “overstated menu item.”

    Chimienti’s complaint was one of several recent lawsuits targeting fast-food companies for alleged misrepresentation of their products in advertisements.

    In August, a judge in the Southern District of Florida denied Burger King’s plea to dismiss a lawsuit originally filed in 2022, wherein plaintiffs are arguing that the chain engages in “unfair” and “deceptive” practices in relation to its Whopper size.

    Similarly, an ongoing lawsuit against Taco Bell alleges that the company’s Crunchwraps and Mexican pizzas are advertised as containing “at least double” the filling they actually contain, seeking damages of at least $5 million.

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    Madeline Garfinkle

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  • Popeyes Dethrones KFC, Battles Chick-fil-A for Top Chicken Chain | Entrepreneur

    Popeyes Dethrones KFC, Battles Chick-fil-A for Top Chicken Chain | Entrepreneur

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    Popeyes is now the nation’s No. 2 chicken chain, CNBC reported.

    After a decade in the No. 2 spot, KFC has been dethroned by Popeyes and now holds the bronze medal. Chick-fil-A is still No. 1.

    Popeyes, a chain owned by parent company Restaurant Brands International, went viral after launching its chicken sandwich in 2019, which set off the “chicken sandwich wars,” with customers lining up for hours at locations across the country. The trend prompted other fast-food chains such as Burger King, Wendy’s, and Sonic to add chicken sandwiches to their menus, causing occasional shortages of poultry.

    KFC, which is owned by Yum Brands, has experienced a market share decline over the past year, dropping from 16.1% to 11.3%, according to Barclays research, per CNBC. However, despite its new No. 2 title, Popeyes also saw a decrease in its market share during the same period, dropping from 15% to 11.9%. Chick-fil-A, meanwhile, expanded its market share from 38.3% to 45.5%.

    But it doesn’t look like Popeyes wants to say No. 2.

    “Game on, Chick-fil-A,” Restaurant Brands International chair Patrick Doyle said at a conference in mid-September, when prompted about its new spot as No. 2 behind Chick-fil-A.

    Related: People in the U.K. Are Lining Up at Dawn for a Fast Food Chain’s Chicken

    Last month, Popeyes said it was redesigning its kitchens with intuitive workstations and automatic batter makers, as well as improving operational efficiency after the initial frenzy around the chicken sandwich led to complaints about slow and inaccurate orders, Bloomberg reported.

    When Sami Siddiqui, Popeye’s president for the U.S. and Canada asked franchisees about “what would be possible” when consistently serving hot and perfect food. Their response was straightforward: “Well, then we’d be Chick-fil-A,” per Bloomberg.

    Related: Top 12 Chicken Franchises to Buy in 2023

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    Madeline Garfinkle

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  • McDonald’s Is Bringing Back the McRib — Again | Entrepreneur

    McDonald’s Is Bringing Back the McRib — Again | Entrepreneur

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    Following a very dramatic and fan-dreaded farewell tour, McDonald’s is bringing back one of its cultiest items yet.

    This week, McDonald’s confirmed to TODAY that rumors (originally posted by fast-food insider “Snackolator” on Instagram) claiming the McRib would be coming back for a limited run this November were true.

    The McRib has become one of McDonald’s most talked about sandwiches and last graced the burger chain’s menu in 2022.

    “It turns out not everyone was ready to say goodbye to the McRib after last year’s Farewell Tour,” a McDonald’s spokesperson told the outlet. “While it won’t be available nationwide, some lucky fans may find their favorite elusive saucy sandwich at their local McDonald’s restaurants this November.”

    Fans were absolutely thrilled to hear the news.

    Though a fan-favorite sandwich, the McRib has never been a permanent fixture on McDonalds menu, only running for a limited-time after initially debuting in 1981 in Kansas City, Missouri.

    The formula for the McRib’s appearance seems to be tried and true for the chain – a surprise announcement that generates hype and buzz, a specified period for how long the sandwiches will be available, select locations and markets identified where the sandwich will be sold, and the sad farewell of the sandwich’s run coming to an end with no hard set date as to when it will return — if at all.

    The famed McRib sandwich in a California McDonald’s restaurant (Getty Images)

    Related: McDonald’s Is Making Its Famous McRib Sandwich Into an NFT

    “If consumers think there is a shortage of a product, or that it won’t be around for long, they will rush out to get it,” said Restaurant Business Online during last year’s McRib run.

    McDonald’s scarcity marketing technique is simple — people tend to want what they can’t have, and for some people, that comes in the form of one barbecue sauce-covered boneless pork patty on a warm bun, topped with dill pickles and onions.

    McDonald’s did not immediately respond to Entrepreneur‘s request for comment.

    The chain was up just over 6.6% in a one-year period as of Wednesday afternoon.

    Related: Everyone Stay Calm: The McRib Is Returning to McDonald’s Menus

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    Emily Rella

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  • McDonald’s Is Raising Its Franchise Royalty Fee on January 1 | Entrepreneur

    McDonald’s Is Raising Its Franchise Royalty Fee on January 1 | Entrepreneur

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    McDonald’s is increasing the royalty fee for new franchisees to buy and operate a restaurant, the company announced on Friday. It’s the first such increase for the brand in nearly 30 years.

    Starting on January 1, the fees will rise from 4% to 5% in U.S. and Canada. However, the increase will not apply to existing franchisees running current operations, those purchasing franchised locations from other operators, rebuilt existing locations, or restaurants transferred within family members.

    The higher rate will only apply to new franchisees, buyers of company-owned restaurants, relocated establishments, and other scenarios involving the franchisor.

    “While we created the industry we now lead, we must continue to redefine what success looks like and position ourselves for long-term success to ensure the value of our brand remains as strong as ever,” Joe Erlinger, McDonald’s U.S. president, told franchisees in a message viewed by CNBC.

    Related: Thinking of Buying a Franchise? These Four Industries Are Flaming Hot Right Now

    McDonald’s also added that the uptick in fees probably won’t affect a majority of its current market, given that the 5% fee is standard in other countries, and the 4% fee was only used in North America.

    “Because the royalty rate is currently at 5% in all owned markets, except for the U.S. and Canada, this royalty rate increase will not apply to a majority of the existing restaurant portfolio,” McDonald’s wrote in the announcement.

    Franchise royalty fees are a percentage of monthly earnings that a franchisee pays to a franchisor. According to the International Franchise Professionals Group, the average royalty fee for a franchise typically ranges from 4% to 12% or more, depending on the type of franchise.

    For food franchises, since they are high-volume businesses, franchisees typically pay lower royalty rates, making the 5% fairly standard for the industry.

    As of 2021, there are over 13,400 McDonald’s locations in the U.S., 95% of which are operated by franchisees, according to Global Data.

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    Madeline Garfinkle

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  • Elderly Woman Sues McDonald’s After Suffering ‘Severe Burns’ | Entrepreneur

    Elderly Woman Sues McDonald’s After Suffering ‘Severe Burns’ | Entrepreneur

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    McDonald’s is facing another alleged burn lawsuit, and the company is not exactly Lovin’ It.

    Mable Childress, a woman in her 80s, filed a lawsuit with the San Francisco Superior Court last week alleging that she had suffered “severe burns” and “emotional distress” claiming that employees did not put the lid on her beverage properly when she was handed her order in the drive-thru.

    “She was injured severely from McDonald’s negligence,” Childress’ lawyer, Dylan Hackett, told local outlet SFGATE in a statement. “She’s an elderly lady, and she was waiting for over an hour to speak to a manager, and a manager never spoke to her. They didn’t give her the time of day. … Nobody helped her whatsoever. She had to get to the hospital herself.”

    Related: Florida Family Awarded $800,000 After Suing McDonald’s When Their 4-Year-Old Was Allegedly Burned and ‘Disfigured’ By a Chicken Nugget

    Childress and her legal counsel maintain that still has pain in her “groin area” as a result of the incident and being “ignored” by staff.

    She is currently seeking seven-figure retribution according to Hackett, though the exact monetary value was not disclosed.

    McDonald’s did not immediately respond to Entrepreneur‘s request for comment, but the franchise owner of the location where Childress was allegedly burned, Peter Ou, said that his team is currently reviewing her accusations in a statement to TODAY.

    “My restaurants have strict food safety protocols in place, including training crew to ensure lids on hot beverages are secure,” Ou told the outlet. “We take every customer complaint seriously — and when Ms. Childress reported her experience to us later that day, our employees and management team spoke to her within a few minutes and offered assistance. We’re reviewing this new legal claim in detail.”

    Earlier this summer, McDonald’s was ordered to pay a Florida family $800,000 after a 4-year-old was allegedly disfigured by burns brought on by a chicken nugget in 2019.

    “This momentous decision brings meaningful closure to an arduous and protracted legal process. Having previously established the defendants, Upchurch Foods Inc and McDonald’s USA LLC, as liable for their wrongful actions, this verdict reaffirms that they must now face the consequences and provide full justice,” the family’s legal team said in a statement at the time.

    Related: Sarah Michelle Gellar: I Was Sued by McDonald’s at Age 5

    Similarly, in 1992, a woman named Stella Liebeck infamously won a $2.7 million suit against McDonald’s for burns she suffered after a hot coffee spilled in her lap.

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    Emily Rella

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  • Crafting a Brand Story: The Secret Ingredient That Will Set You Apart From Competitors | Entrepreneur

    Crafting a Brand Story: The Secret Ingredient That Will Set You Apart From Competitors | Entrepreneur

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    The following excerpt is from franchise expert Mark Siebert’s book The Multiplier Model. Buy it now.

    Take a moment to think about this question: What is it about your brand that would make a customer want to do business with you instead of your competitors?

    A big part of success is that the customer picks you because of your story.

    If you’re looking to duplicate your business, you need to have a compelling story to tell, you need to tell it in a memorable way and you must embrace it as the crux of your success. Here’s how to get started.

    Related: Considering franchise ownership? Get started now and take this quiz to find your personalized list of franchises that match your lifestyle, interests and budget.

    Let your slogan tell your story

    One way successful brands tell their story is through their brand slogan. Let’s look at one of our nation’s most iconic brands—Dunkin’ Donuts—which has recently been rebranded to Dunkin’.

    The “America Runs on Dunkin”” slogan, adopted in 2006, speaks to fast-moving consumers. The story this conjures up is a mixture of the following:

    • Compelling: We’re here for busy people.
    • Logical: You need coffee and fuel—and we’ll get it to you quickly.
    • Emotional: We’re Americans, and we’re in this together.

    Note that the slogan does not even mention coffee or doughnuts, and I suspect that’s because it would change the underlying brand story too much. As Dunkin’ has evolved into a beverage-first, on-the-go brand, their core story is the same—fast, accessible and reasonably priced bakery items and beverages for busy people.

    In their own words, it’s “part of our guests’ everyday routine.” Their story and how they communicate it is why they are consistently a leader in the quick-service restaurant space.

    Your slogan should be emotionally moving

    While this is not a how-to article about writing your company slogan or tagline, consider the emotions of some of the best-known slogans. The Walmart story has consistently revolved around selling more for less—and its slogans have reflected this, from “Always Low Prices, Always” to the current “Save Money. Live Better.”

    Consider some of the examples below and what they tell you about the brand’s unique story, its emotional appeal to customers and its implied call to action:

    • Papa John’s: “Better Ingredients, Better Pizza” invokes a feeling of a high-quality eating experience.
    • Planet Fitness: “Judgement Free Zone” relieves the anxiety of working out in a gym, especially if you are new to a fitness journey.
    • Jimmy John’s: “Freaky Fast” assures its consumers of rapid service.
    • Southwest Airlines: “You’re Now Free to Move About the Country” and, more recently, “Low Fares, Nothing to Hide” gives its customers a sense of trust when traveling.
    • Big Blue Swim School: “Life’s Big Moments Start Here” invokes happiness and pride when learning how to swim and taking that with you for the rest of your life.

    Related: How to Finance Your Franchise

    Position your franchise as the best option

    The goal when telling your story is to convey that consumers should choose you because in some way you are the best option. Taco Bell has succeeded at that with its “Think Outside the Bun” campaign.

    I expect many of you have never heard of McDonald’s early competitors: Burger Chef, Dee’s Drive-In, Sandy’s, Red Barn and Druther’s (which began its life as Burger Queen). How about Geri’s Hamburgers or Wetson’s?

    But I’ll bet you all know about Burger King and Wendy’s. Why is it that Burger King and Wendy’s have thrived while the others didn’t?

    One reason is that Burger King positioned itself as the “Have It Your Way” burger. When introduced in the early 1970s, this message was compelling (“Fast-food ordering doesn’t have to be so strict.”), logical (“Why would I buy something that wasn’t exactly what I wanted?”) and emotional (“You deserve this.”).

    Instead of following a copycat strategy (which almost never works in business expansion), Burger King’s message told consumers they had a choice. As a practical matter, McDonald’s could not compete with this at the time because it would have required a reworking of its kitchen operations.

    Wendy’s, meanwhile, survived by appealing to an older audience through its Clara Peller ads, which told its story through the voice of an octogenarian with an emphasis on good old-fashioned hamburgers.

    Whatever route you take, own it

    Using your slogan is a quick and straightforward option to market your franchise and tell your story about why you are the right choice in a world of competition. As seen with the plethora of success stories of other franchises, it’s perfectly attainable to be concise in your words while leaving a prospective consumer empowered, relieved, thankful, trustful, eager or any other emotional verb.

    If your marketing strategy is strong, consumers will automatically think of you whenever they conjure up that specific feeling—and hopefully, sign up, purchase or eat with your franchise.

    Get started with The Multiplier Model

    Going from small business to successful startup to scalable growth takes more than good luck. It takes a system. Over the last 34 years, franchising consultant and growth expert Mark Siebert has been sought out by more than 70,000 executives looking to expand their companies. Out of those 70,000, only 5,000 had the right systems in place to go from successful to scalable. In The Multiplier Model, Siebert discusses the factors that determine if an entrepreneur is ready to scale their venture — and the best ways to get started. Read more.

    Related: Find Out Which Brands Have Ranked on the Franchise 500 for Longest, Earning a Spot In our New ‘Hall of Fame’

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    Entrepreneur Staff

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  • Why Your Favorite Hobby Shouldn’t Be Your Next Business Idea | Entrepreneur

    Why Your Favorite Hobby Shouldn’t Be Your Next Business Idea | Entrepreneur

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    Opinions expressed by Entrepreneur contributors are their own.

    If you’re interested in franchise or business ownership and you’re in the beginning stages of researching what kind of business matches your entrepreneurial goals, the options available can be overwhelming. After all, 20% of new businesses fail in the first two years of being open, 45% during the first five years and 65% during the first 10 years, according to the U.S. Bureau of Labor Statistics. Additionally, franchises exist in nearly every service industry, and there are more than 3,000 registered franchise brands across the United States.

    Because franchise and business ownership can run the gamut in terms of products and services sold, it isn’t uncommon for candidates to consider hobbies that already interest them when producing ideas for a future company. However, it’s important to understand that sometimes, hobbies and businesses don’t mix well.

    For example, let’s consider a hypothetical business owner candidate. Let’s call him “Phil.” One of Phil’s favorite pastimes is to hit the green for a round of golf. Since golf is already a longstanding interest, Phil is inclined to consider a franchise that sells a variety of golfing products: clubs, balls, tees, clothing, etc. However, before long, Phil’s working hours are consumed with all things golf, and his work days are filled with balance sheets, sales reports and expenses for golf products. Suddenly, escaping to play a few holes on the weekend isn’t the break away from work it once was.

    When a favorite hobby becomes synonymous with work, you find yourself in a lose-lose situation. To avoid this overlap, examine the following three tips below for considering possible options.

    Related: Mark Cuban Says “Follow Your Passion” Is the Worst Career Advice You Can Get. Here’s Why.

    1. Separate your personal hobbies from your business

    Rarely can a person spend their leisure time and work time focused on the same thing. It’s basic Business 101 to diversify your investments, and a business is a large investment of your time, energy and money — so why would you keep all your eggs in one basket? Best practice: Separate your personal hobbies from your business.

    Like Phil, you probably have a hobby or interest that helps you unwind after a long week. However, for a business to maintain longevity, sustainability is the name of the game. So take a moment to consider your hobbies, and rather than focusing on the hobby itself, take a look at the services that support that hobby.

    If we take our friend Phil, rather than a golf store, maybe he selects a franchise of dry cleaning stores, hair salons or group fitness studios that service a community with fellow golf lovers. Another option might be a B2B franchise in which Phil doesn’t perform the services himself but is client-facing and responsible for relationship-building by taking prospective clients out to the green for an afternoon. Either of these options supports his entrepreneurial goals while maintaining his favorite pastime.

    2. Be passionate about owning your business, not passionate about the widget

    Being a business owner means having more control over your life in so many ways. The top motivators for an individual to become a business owner are autonomy, more flexibility, more purpose/meaning and financial security.

    These benefits of business ownership and their ability to support yourself, your family or other financial and non-financial obligations outweigh the appeal of selling a specific product or service.

    Building on the previous tip, a way to avoid misalignment between the product or service you are selling and the overall vision of the business is to focus on bird’s eye metrics of success. For example, owning a chain of cleaning stores might not be your dinner party small talk highlight that “golfing” might be, but who’s hosting the dinner?

    Prioritize long-term goals over what sounds cool to sell — a.k.a. be passionate about owning a business and all the benefits that come from that, rather than being passionate about a specific widget you sell.

    Related: Why You Should Stop Trying to ‘Find Your Passion’

    3. Your business should match a lasting market

    A common misconception about franchises in particular is that they are all centered around the fast-food industry. This makes sense: Everyone eats multiple times per day, hence a stable and recurring consumer base. However, any company that can benefit from proper branding, repeatable processes and continuing product or service evolvement is a candidate to be franchised. While it’s true that there are a number of successful restaurant-style franchises, there are so many other options that fall into the “service-based” franchise bucket.

    In today’s business world, particularly with a younger generation of consumers, experiences are valued over material items. To support these experiences, a number of non-flashy but necessary service industry tasks are essential. What is a service that you use on a recurring basis that is not centered around food? Clean clothes perhaps? Monthly haircuts? Consistent trips to the gym? Phil would agree.

    If there is a recurring customer need, then there is likely a franchise that is seeking to capitalize on that customer need.

    At the end of the day, hobbies are a great place to start for brainstorming purposes, but think outside the box and ask yourself: What tangential services support your hobby or other hobbies that are similar in nature? Before long, you’ll have a list of services, and, to bury the lead, I guarantee there will be multiple franchises for you to consider associated with those services.

    So remember these three key takeaways when considering business ownership: First, hobbies and business are best kept separate. Second, owning a successful business is the goal (not selling a specific product/service). Third, set yourself up for success by selecting a business that has a strong base of perpetually recurring customers.

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    David Busker

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  • Who Bought Subway? Chain Sells for Billions to Roark Capital | Entrepreneur

    Who Bought Subway? Chain Sells for Billions to Roark Capital | Entrepreneur

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    After nearly six decades as a family-owned business, Subway has been sold to private equity firm Roark Capital in a groundbreaking deal – but it’s not the only sandwich joint in the firm’s portfolio.

    The sale puts Subway under the same umbrella as rival Jimmy John’s, which is controlled by Inspire Brands also owned by Roark Capital.

    The sandwich giant announced the news in a press release on Thursday, and although terms of the deal weren’t disclosed, the Wall Street Journal previously reported that Roark offered Subway $9.6 billion after it was listed for sale in February for $10 billion.

    RELATED: Nearly 10,000 People Agree to Make a Legally Binding, Lifetime Commitment for Free Subway Sandwiches

    Photo by Xavi Lopez/SOPA Images/LightRocket via Getty Images | Pedestrians walking past a Subway store.

    The deal with Roark is one of the biggest acquisitions in the fast food industry, per CNN. The company has $37 billion in assets and a massive food portfolio with investments in Arby’s, Auntie Anne’s, Buffalo Wild Wings, Carvel, Sonic, and more.

    The largest was Inspire Brands’ $11.3 billion deal to purchase Dunkin’ in October 2020.

    Subway’s sale comes as the brand tries to revamp with store renovations and freshly sliced meats.

    RELATED: This Is Where Subway’s Co-Founder Left Half of His Fortune

    The acquisition is a new beginning for the sandwich shop, which has been owned by the DeLuca and Buck families since Fred DeLuca and Dr. Peter Buck opened the first Subway in Bridgeport, Connecticut, in 1965, according to the company’s website.

    Today, Subway is one of the world’s largest restaurant brands, with 37,000 locations across more than 100 countries.

    With hopes of continuing to expand, “this transaction reflects Subway’s long-term growth potential and the substantial value of our brand and our franchisees around the world,” Subway CEO John Chidsey explained in the press release.

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    Sam Silverman

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  • Boost Your Franchise With This Innovative Marketing Solution | Entrepreneur

    Boost Your Franchise With This Innovative Marketing Solution | Entrepreneur

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    Opinions expressed by Entrepreneur contributors are their own.

    Franchising has become increasingly popular in 2023. There are a number of positive predictions, according to the 2023 Franchising Outlook Study, and forecasts show it will continue to grow. In fact, it will add more than a quarter-million jobs and another 15,000 new independent businesses this year. Franchising is an amazing business model, regardless of the product or service, from The Lube Center (for cars) to Diaper Services to Diamond Brokers, that can be reliably exercised by trained staff while minimizing the need for innovation.

    Ultimately, it creates a template for a successful business model, delivering a replicated product that consumers understand and rely on for a known quality, a known experience and a known price — without concern for the location, time of day or staff.

    But the success of a franchise lies in attracting the “best of the best” franchise owners and operators who represent the most compelling characteristics of our American spirit: motivated entrepreneurs willing to invest and commit to creating their own American dream as a business owner. A franchise must compete for these valuable franchisees by demonstrating their franchise provides a clear path to success with support and tools, making it an ideal investment choice.

    This article will explore a new franchise value that is obtainable, demonstrable and turnkey, that will not only influence the potential operator but will catapult existing franchise operations to new levels of success. This value is applicable to all forms of franchises in any industry — literally, any franchise that needs or would benefit from building loyal customers — but for the sake of providing examples, this will focus on the food service industry.

    Related: 5 Ways to Freshen Up Your Franchise Marketing in 2023

    Gain a competitive edge with a successful marketing solution

    Franchisees desire success just like you do, and beyond furniture and fittings, or supply chain operational challenges, it’s important to support all locations with critical marketing and sales support that sets them up for profitability from the start.

    However, the work doesn’t end once the franchisee has a successful launch. Across the entire franchise, from locations in operation for years to the newly opened store, consistent, reliable and valuable guest engagement and direct marketing are as important as the decision to standardize fries delivered directly from Idaho.

    Embracing a new, innovative approach to engaging the guest and leveraging the success of the individual locations for the success of the franchise will position both the franchisee as well as the franchisor to new levels of growth.

    So, to gain a competitive edge and to attract not only potential franchisees, but investors, integrating an ongoing and successful marketing solution into your franchise operations is a “must.”

    The role of integrated WiFi marketing in a franchise

    Effective marketing for a franchise requires the right technology to maximize return on investment. Studies show that 96% of customers prefer a business that offers free on-site WiFi (Cisco), and an overwhelming majority of customers are happy receiving promotions and messaging while connected to the WiFi. However, only a small percentage of franchises have turned their WiFi presence into a successful marketing solution, which can be accomplished through integrated WiFi marketing technology.

    This technology is actually a set of technologies that include WiFi, text, social media and digital displays integrated to execute a marketing campaign. And it provides a single operational point to oversee franchise-wide marketing campaigns, while also empowering operators to leverage those same technologies for localized campaigns.

    With integrated WiFi marketing, customers can access the free WiFi by providing their phone number or by logging in with Facebook, Google or email, and this builds a simple, consistent and reliable communication link directly to the device in the customer’s hand. This link allows the franchise to recognize the device and record their visits and general behaviors, such as the days they come in, times of day, duration of the visit, typical frequency and more. With this new data, the franchise is now able to hyper-target customers with messaging that resonates uniquely with their interests.

    With the customer data, personalized SMS messages with specific offers can be sent, and the franchise can track when a customer enters a new location and send them a message such as, “We’d love to hear of what you think of our Fresno location (link to survey), and for your time, we’ll upgrade your choice of combo meals.” Or it could even be something more fun like a link to the social presence of that specific store’s events page and asking for a “check-in.”

    Related: Is Your Customer Communication Actually Effective? Here’s How to Avoid the Limitations of Common Tactics

    Tying It all together for optimal success

    Since the goal of this article is to demonstrate a way a franchisor can provide value to attract top-performing franchisees, let’s look at a fully integrated example of WiFi marketing that ties in a WiFi greeting with social media, digital displays, text messaging and use of a QR code — all while customer data is being filtered and the messaging targeted — for revenue-generating results:

    1. A customer who has visited before and provided their information to access the free WiFi walks into the restaurant location and the device is recognized. The customer immediately receives a greeting via text message: “Thanks for visiting us again. How do $5 margaritas and $2 tacos sound with prizes and entertainment? We’re having a 4th of July fiesta. Learn more here (link to event on Facebook).”

    2. The customer goes to the Facebook event with a single click and (hopefully) “likes” the post and RSVPs to the event. While there, the customer learns that those who join the loyalty program get a free pint glass at the event and can reserve EXCLUSIVE VIP seating in advance — an offer only made to WiFi loyalty customers.

    3. The event and loyalty program benefits are further promoted on the digital display signage that has the following message: Get VIP status at our annual 4th of July fiesta. Sign up for our loyalty program by texting FIESTA to XXXX.” The digital display signage also has a QR code that can be scanned for more information on the 4th of July fiesta and a call-to-action to RSVP.

    4. The customer has now received messaging that accomplishes several important steps. First, the customer has been enticed to attend the 4th of July event. Second, the customer has been driven to the restaurant’s social media posts where they can engage, which in turn, ensures Facebook’s algorithm shows the posts more prominently. Third, the customer has been “encouraged” to join the loyalty program which, in turn, motivates the customer to become not just a repeat customer, but a loyal customer. And fourth, the digital display messaging and QR code further reinforce event attendance, loyalty program participation and social media engagement.

    Combined, this integrated approach to marketing the restaurant’s event and loyalty program translates to the customer attending and spending money at an event they may otherwise have not paid attention to or known about, and most importantly, the customer has transitioned from being a one-time customer to a loyal, revenue-generating customer.

    For the franchise, this is valuable because the solution is centralized, and all the marketing elements can be uniform, distributed in a timely manner and not be reliant on the individual franchise locations for compliance with the program. Additionally, since it can be automated, replicated and distributed across the entire franchise with the click of a button, the underlying marketing campaigns are synchronized and executed for maximum results.

    While for the franchisee, the campaigns are no longer a burden and allow the franchisee to focus on their operations, staffing and profitability driven by powerful marketing that drives repeat business and event attendance. Also, the franchise and franchisee both are able to see the tangible, black-and-white results of the effectiveness of the complete marketing campaign in real time.

    Related: How Franchises Can Utilize Technology to Change Consumer Behavior

    Effective marketing is essential to growing a franchise business, and the incorporation of integrated WiFi marketing technology can maximize ROI and help achieve business goals — while providing the franchise with a unique and revolutionary discriminator in the competition for the most desirable franchise operators.

    By offering Integrated WiFi marketing technology as part of franchise operations, franchisees can capture customer data, send targeted SMS messages, leverage social media, utilize digital displays and access real-time reports across the entire franchise. Overall, providing this technology can increase the franchise’s overall brand image, boost franchise success and contribute to overall brand growth.

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    Stephen Gould

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  • Drew Brees: From Football to Franchising | Entrepreneur

    Drew Brees: From Football to Franchising | Entrepreneur

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    Opinions expressed by Entrepreneur contributors are their own.

    In this captivating podcast episode, hosted by Jeff Fenster, founder and CEO of Everbowl, former NFL quarterback Drew Brees shares his remarkable transition from the football field to the world of entrepreneurship. The conversation between these two accomplished individuals offers a unique blend of insights from both the host and the guest, adding credibility and depth to the discussion.

    Jeff Fenster, a highly successful entrepreneur himself, brings his expertise and experience to the table as the host of the podcast. As the founder and CEO of Everbowl, a fast-casual restaurant chain specializing in superfood bowls, Fenster has demonstrated his ability to identify market opportunities and build a thriving business. His entrepreneurial journey serves as a testament to his knowledge and understanding of the challenges and triumphs that come with building a successful brand.

    Fenster’s entrepreneurial journey began with a vision to create a healthy and delicious dining option that would cater to the growing demand for nutritious food. With a passion for health and wellness, Fenster recognized the need for a fast-casual restaurant that offered nutrient-rich meals without compromising on taste. This realization led to the birth of Everbowl, a concept that has since gained popularity and expanded to multiple locations.

    As the founder and CEO of Everbowl, Fenster has been instrumental in shaping the brand’s identity and driving its growth. His hands-on approach and commitment to quality have earned him a reputation as a respected figure in the restaurant industry. Fenster’s ability to identify market trends, adapt to changing consumer preferences, and build a strong brand presence has been key to Everbowl’s success.

    On the other side of the conversation, Drew Brees, a legendary NFL quarterback, brings his own credibility and expertise to the discussion. With a career spanning two decades, Brees is widely regarded as one of the greatest quarterbacks in NFL history. His accomplishments on the football field, including a Super Bowl victory and numerous records, have solidified his status as a respected and admired figure in the sports world.

    Beyond his football career, Brees has also made a name for himself in the business world. As a franchisee for Jimmy John’s sandwiches and an investor in various other ventures, Brees has demonstrated his entrepreneurial acumen and ability to navigate the complexities of the business landscape. His experiences as a franchise owner and his commitment to authenticity in his business ventures further enhance his credibility as a successful entrepreneur.

    Brees’ journey into entrepreneurship began with his foray into the world of franchising. As a franchisee for Jimmy John’s, Brees gained firsthand experience in running a business and managing a team. This experience sparked his interest in franchising and opened his eyes to the possibilities that lay beyond the football field. Brees recognized the value of aligning himself with established brands that shared his values and resonated with his personal brand.

    Brees’ commitment to authenticity has been a guiding principle in his entrepreneurial endeavors. He understands the importance of staying true to oneself and maintaining unwavering integrity in business. This commitment not only ensures a genuine connection with his business ventures but also helps build trust and loyalty among his customers. Brees believes that authenticity is the key to building a successful and sustainable business.

    But what sets Brees apart is his ability to find love in difficult situations. He fearlessly opens up about his personal encounters with failure and adversity, emphasizing the importance of resilience in overcoming challenges. Brees firmly believes that setbacks are not the end of the road but rather stepping stones to success. He encourages aspiring entrepreneurs to embrace failure, learn from it, and use it as fuel to propel themselves forward. By reframing challenges as opportunities for growth, entrepreneurs can approach difficult situations with a positive mindset, unearthing the hidden gems within every setback.

    Brees’ experiences as a franchisee have also highlighted the value of the franchise community. He recognizes the wealth of knowledge and support it offers. Brees cherishes the opportunity to learn from fellow franchise owners, understanding the power of collaboration and shared experiences.

    The franchise community provides a vibrant platform for entrepreneurs to connect, exchange ideas, and gain invaluable insights from others who have walked a similar path. Brees’ experiences underscore the importance of building relationships and leveraging the wisdom of others in the pursuit of success.

    In addition to his franchise ventures, Brees has also found success in expanding his Everbowl locations. Everbowl, a fast-casual restaurant chain specializing in superfood bowls, aligns with Brees’ commitment to health and wellness. Through his involvement with Everbowl, Brees has not only expanded his business portfolio but also contributed to promoting a healthy lifestyle among his customers. This expansion showcases Brees’ ability to identify opportunities that align with his personal values and leverage his platform to make a positive impact.

    Brees’ journey into entrepreneurship is a testament to the power of setting goals and embracing challenges. He emphasizes the importance of having a clear vision and working tirelessly to achieve it. Brees’ relentless pursuit of excellence on the football field has seamlessly translated into his business endeavors. He believes that the same principles of discipline, hard work, and dedication that propelled him to success in football are equally applicable in the world of entrepreneurship.

    As Brees reflects on his journey, he acknowledges the lessons learned from both successes and failures. He understands that failure is not a reflection of one’s worth but rather an opportunity for growth and improvement. Brees encourages entrepreneurs to embrace failure as a stepping stone to success, reminding them that even the greatest achievements are often preceded by numerous setbacks.

    In conclusion, Drew Brees’ journey from the gridiron to the boardroom is a captivating tale that offers invaluable insights for aspiring entrepreneurs. His entrepreneurial mindset, emphasis on authenticity, unwavering resilience, and commitment to personal values serve as a beacon of inspiration. Brees’ unwavering belief in finding love in difficult situations and his deep appreciation for the franchise community further underscore the importance of resilience, collaboration, and continuous learning in the entrepreneurial journey.

    As entrepreneurs navigate their own paths, they can draw inspiration from Brees’ experiences and apply his insights to their own ventures. By embracing challenges, staying true to their values, and seeking support from the vibrant community, entrepreneurs can conquer obstacles and achieve their loftiest goals. So, gear up, embrace the unknown, and let Drew Brees’ entrepreneurial spirit guide you to victory in the game of business.

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    Jeff Fenster

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  • McDonald’s to Launch Spinoff Restaurant Chain Called CosMc’s | Entrepreneur

    McDonald’s to Launch Spinoff Restaurant Chain Called CosMc’s | Entrepreneur

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    McDonald’s Grimace Birthday Meal released in June went viral on social media and drove sales, and now the restaurant chain wants to capitalize on another beloved mascot from the past.

    McDonald’s executives said the company plans to launch a spinoff restaurant chain called CosMc’s; it will be based on the mascot called “CosMc,” an alien from outer space that was featured in advertisements in the late 1980s and early 1990s, CNBC reported.

    Related: McDonald’s Grimace Shake TikTok Taking Over Boosts Sales

    “CosMc’s is a small format concept with all the DNA of McDonald’s, but with its own unique personality,” McDonald’s CEO Chris Kempczinski said, per the outlet.

    CosMc’s will launch at a small number of sites in “a limited geography” in early 2024. Few details were shared on the second-quarter earnings call, but investors can expect to hear more in December.

    McDonald’s plans to invest up to $2.4 billion in capital expenditures this year, roughly half of which will go toward building 1,900 new restaurants around the world. The move will put pressure on its profits, Reuters reported in January.

    But Kempczinski said this quarter’s “theme was Grimace,” per CNBC — and it looks like the company hopes to ride that wave of mascot nostalgia into an even bigger success with CosMc.

    Related: 22 McDonald’s Facts That May Surprise You | Entrepreneur

    McDonald’s Corp is up nearly 12% year over year.

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    Amanda Breen

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  • Struggling in Franchising? You Need to Think Bigger. | Entrepreneur

    Struggling in Franchising? You Need to Think Bigger. | Entrepreneur

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    Opinions expressed by Entrepreneur contributors are their own.

    A few years ago, I was speaking to some friends and colleagues about a vision I had for a new franchise restaurant. I told them the brand had a unique concept and could quickly be on track to 1,000 worldwide locations. The responses were fairly consistent: incredulity and laughter. And these people were supposed to be my friends!

    The brand we talked about was The Halal Guys, a company I work with. After an extremely successful 2022, one in which the company opened its 100th location — and with 300-plus more in development — it was tempting to then ask them, “Who’s laughing now?”

    The plan was aggressive from the jump: We’d target the 50 largest markets in North America, then go international. Most of those major metro areas are covered now, and international expansion has begun with the UK and South Korea. Pulling this all off as quickly as we’d envisioned seemed impossible to a great many, but that ambitious mindset worked.

    Here are some essential strategies I’ve applied in the course of taking more than 10 such brands worldwide.

    Related: 5 Strategies You Need to Build Your Brand

    Think positively

    There’s nothing a failing person likes to see more than someone else fail. So, it’s okay if someone doesn’t see your vision: It wasn’t their vision anyway, it’s yours.

    My story about The Halal Guys isn’t an outlier. When you’re building, many people are going to root for you to tank simply because they aren’t winning, which often means that they’ll give you bad advice, encourage you to back off and/or withhold a helping hand. That’s why it’s so important to think positively about your brand’s potential and growth plan. Because challenges arise for young franchises daily, and panic doesn’t put money in the bank.

    When I was helping PayMore through its initial franchise launch, it seemed that we couldn’t sell to anyone. Despite great unit economics and a scalable business plan, many thought its buy-sell-trade model seemed too much like a pawn shop, and in truth, we weren’t doing the company any favors by presenting it like one.

    Still, there was no panic. We stayed positive and altered our presentation. It’s been a little more than a year now since we launched franchising, and over the last two months have completed more than a dozen deals encompassing 60-plus units. Put simply, positivity paid off.

    Think aggressively

    It’s important to have brand standards, but it’s also important to know when to bend them. You may be dead-set on only allowing multi-unit deals, for example, but the right single-unit deal can get the ball rolling for a stagnant brand, including attracting good press, which could lead to a multi-unit franchisee down the road.

    Also, think about how you can incentivize franchisees to expand their territories because encouraging them to embrace affordable conversions could lead to quicker growth (keep in mind that this requires having the right design and brand standards in place). Thinking aggressively means being prepared to act fast when opportunities arise, so plan accordingly when building your business strategy.

    Part of thinking aggressively is thinking big: Don’t be content with small, steady growth if your concept can handle rapid expansion. Don’t be afraid to go for it.

    Related: As a Leader, You Need to Be Both Positive and Aggressive

    Think beyond yourself

    Building a brand that aims to be a household name is a lot easier with a solid team in place. I’ve always enjoyed getting my hands dirty, and I’ve never worked harder than I did for real mentors and with other people who have taught me about the industry.

    Case in point: I’m working with a new brand out of Chicago called Cilantro Taco Grill. Their story is inspiring — run by a family of first-generation immigrants from Jalisco, Mexico, who built the restaurant as a tribute to their father and as a celebration of the authentic flavors they grew up with. They’ve dominated the quick-service Mexican scene in Chicago, in part because their business plan was born out of familial love. The company’s story and standards are authentic, and its food tastes better because of that.

    This is just part of why it’s so vital to share your goals, and even more so to share your success. Team members should also be in line with the business plan and where the brand is headed — should be thinking positively and aggressively right alongside you. Of course, that requires the right workplace dynamic: People naturally invest themselves in people who take care of them, so incentivize success, offer quality benefits and provide a comfortable workplace.

    Related: Why Are Companies Still Holding Back on Investing in Employees’ Development?

    Think about the future

    The goal for any franchisee should be to get wealthy, certainly, which involves building towards an exit. This business, like virtually all others, is about growing an asset that has the potential to sell at peak value. That’s why you need to be positive, prioritize aggression and focus on building a team — with the very possible goal of attracting a buyer. A profitable five-unit franchise chain that sells at eight times its yearly income could potentially set you up for life — a return most other industries can’t offer in a comparable timeframe.

    You shouldn’t be looking to create a job — heck, you can go find a job. Your future in franchising should be building generational wealth — for your family, your kids and yourself.

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    Dan Rowe

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  • How to Measure Success With Comparative Testing | Entrepreneur

    How to Measure Success With Comparative Testing | Entrepreneur

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    The following excerpt is from franchise expert Mark Siebert’s book The Multiplier Model. Buy it now.

    When it comes to franchise success, continually striving for improvement is key. In the marketing world, we call these A/B tests.

    In an A/B test, the goal is to isolate two variables to determine which one works better. This is imperative for decision-making and business growth.

    Here’s a quick example

    Let’s assume you’re running a pay-per-click (PPC) ad for a home-service business, and you want to know whether an ad that touts same-day service is more effective than one offering a money-back guarantee.

    By running both ads and measuring the results against similar audiences, you could see which message resonates better.

    Related: Find Out Which Brands Have Ranked on the Franchise 500 for Longest, Earning a Spot In our New ‘Hall of Fame’

    Now take that example and tweak it

    Then you could try two more ads with two completely different messages and measure their results against the winner of the first test or go head-to-head in a real-time matchup.

    Doing this can significantly improve how well your message resonates with your customers.

    Do this again and again, and ultimately you will have statistical evidence as to which message (or messages) work best to attract your targeted buyer.

    Refine your A/B tests even more

    There are all kinds of variants and refinements you can try. Perhaps B won your first A/B test, and now you need to decide between B and C (this process of incrementally improving your messaging can — and should — go on virtually forever).

    If you’re testing PPC ads, you could send the respondents to different landing pages, creating two sets of A/B tests with your messaging — one that measures the drawing power of the initial message and one that measures the power of the message on the landing page. Now your testing process begins to look like a decision tree.

    Related: These Are the Top 200 Global Franchise Brands in 2023

    Test across different media types

    What we are talking about here is creating a system that you have tested, measured and refined until each element of the system works.

    Now imagine that the system you’ve built for your advertising message can be extended beyond just the message to the media that carries it. Each form of media can produce different leads for you, at a different cost per lead. And each of those leads will have a different value to you in terms of cost per sale. So you need to measure these variables during your testing process as well.

    If you can do that across the entire marketing spectrum, you can refine your media mix and your advertising budget along with your message. This will allow you to optimize your marketing and create a true system for the entire marketing process.

    Keep in mind, though, that when you measure this system against your financial performance, you should only keep it if it generates revenue for you at a rate that allows you to provide your service (or your product) profitably.

    If your marketing costs are so high that it becomes impossible for you to turn a profit, you need to go back to the drawing board and find something (different marketing, hopefully, but perhaps different products or services) that will allow you to make money.

    Go beyond the marketing example

    The example above is how successful marketing systems are created.

    But these systems are not just limited to marketing: In the best businesses, they are incorporated in almost every repetitive function of business operations — from site selection and build-out to hiring and training to purchasing and pricing to production and delivery.

    Related: The 9 Provisions Every Franchise Agreement Needs to Have — and What They Mean

    Get started with The Multiplier Model

    Going from small business to successful startup to scalable growth takes more than just good luck. It takes a system. Over the last 34 years, franchising consultant and growth expert Mark Siebert has been sought out by more than 70,000 executives looking to expand their companies. Out of those 70,000, only 5,000 had the right systems in place to go from successful to scalable. In The Multiplier Model, Siebert discusses the factors that determine if an entrepreneur is ready to scale their venture — and the best ways to get started. Read more.

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    Entrepreneur Staff

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  • 4 Reasons You May Not Qualify For a Franchise | Entrepreneur

    4 Reasons You May Not Qualify For a Franchise | Entrepreneur

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    Opinions expressed by Entrepreneur contributors are their own.

    Not everyone can or should become a franchise owner. It may seem like franchisors are overly aggressive in trying to sell franchises to new owners; however, a good franchise company is not looking to award a franchise to any random candidate who can afford the franchise fee.

    Like any good business, a good franchise company knows it can only succeed with great people in the system. And every franchise system has a preferred profile for who will make a strong franchisee — typically based on analyzing successful prior franchisees and creating an ideal avatar for success.

    The value of any good franchise system is a strong, consistent brand. A franchisor looks for franchisees who are a great fit for the services they offer and can provide consistency through business skills and acumen. For example, some franchises require more emphasis on sales leadership, while others succeed more through the execution and delivery of the service through team members.

    As you proceed with the franchise investigation process, you should expect that a franchisor will have as many questions about you as you do about them. It is true that many franchisors desire to grow quickly — after all, many of them are new emerging companies also. Growing units more quickly allows them to invest in the infrastructure, assets and personnel to support a strong franchise network. But a good brand will be very careful to only award franchises to candidates who pass stringent criteria and they expect to be the best representation of the brand.

    I always tell my candidates to treat the investigation process like a job interview. Once you get the offer, you have choices, but you need to put your best foot forward to get awarded a franchise. These companies are not selling used cars. Because they have to talk to sometimes dozens or even hundreds of candidates to sign a qualified franchisee, it may feel like you’re going through a slick sales process — and you are, for efficiency’s sake. But it is still selective. I have had multiple candidates rejected at Discovery Day when they don’t present well after meeting the founders and management team.

    Here are some common reasons you might not qualify or get awarded a franchise.

    Related: 7 Things You Need to Know Before Becoming a Franchise Owner

    1. Lack of capital

    Every franchise has a minimum liquidity and net worth requirement. There are many avenues to finance your business, and franchise companies will often put in place special financing programs — especially if they have unique equipment needs, fleet vehicles, etc. But at the same time, the franchisor wants to confirm you have adequate reserves for working capital, achieving positive cash flow and covering your living expenses while you ramp up. If you are undercapitalized, they want to avoid setting you up for failure.

    2. Lack of business acumen

    Harvard Business Review researchers found that the average age of entrepreneurs at the time of their company’s founding is 42. Franchisees likely skew even a little older, with many coming from corporate management backgrounds. As a franchisee, you don’t need industry experience, but you should have a strong foundation of leadership and management experience. Knowing you can lead a team, work with others and be a good partner are traits every good franchisor wants to see in a candidate.

    3. Lack of availability

    Many franchises have full-time requirements, which is not usually a problem if that matches the candidate’s needs. But I’ve had many franchise candidates who want to keep their corporate jobs and start a franchise on the side. There are a large and growing number of franchise companies that allow that and are structured to be run by a manager. However, there is no such thing as a truly passive franchise. If you are looking only for investment and have no interest in running a business, you won’t be a strong candidate for a franchise. Even for semi-absentee models, you need to have enough flexibility to be available to your general manager and handle the occasional business issue during regular work hours.

    Related: Go Beyond the Interview: How to Get a True Feel for a Franchise

    4. Poor attitude

    I’ve never told a franchise candidate that starting a business is easy. It’s not. So, it’s even more important that candidates have an abundance mindset and the mental fortitude to overcome obstacles. If a franchise candidate is negative and pessimistic before even getting started, how are they going to hold up emotionally when the inevitable challenges come up when starting a business? A franchisor wants to see a true entrepreneurial spirit in candidates before awarding them a franchise.

    If you investigate a franchise company that is simply looking to add franchisees without any standards or qualifications, watch out for that brand. It’s not common, but like anything else, there are good franchise companies and bad franchise companies. If you have a hard time filtering all of the brands out there, you may want to engage a franchise consultant to help you focus on strong brands that will be invested in a long-term partnership to help you achieve your goals.

    Nearly every franchisor wants to grow and add more franchisees. But the good brands are focused only on adding highly qualified and value-added franchisees. Having the right mindset as you go into the process will help you avoid seeing it as a one-way street. Yes, they are selling you the franchise opportunity, but you also need to sell yourself as a valuable and productive partner in their system. Make sure your capital, skills, time and attitude all line up with the prospective franchise system and put your best foot forward to be awarded a franchise.

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    David Busker

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  • How to Determine Your KPIs and Achieve Profitability | Entrepreneur

    How to Determine Your KPIs and Achieve Profitability | Entrepreneur

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    The following excerpt is from franchise expert Mark Siebert’s book The Multiplier Model. Buy it now.

    One of the most important things you can do to help ensure the success of your business is to determine your key performance indicators (KPIs).

    KPIs are the inputs into your business system. Each KPI has a target range that, if achieved and combined successfully with other KPIs, will allow you to manufacture the output of your business profitability.

    Read on for what you should know about KPIs and how you can apply these practices to your own business.

    Related: Busting Franchising Myths and Choosing the Right Opportunity

    KPIs can be industry-specific

    KPIs vary substantially depending on the industry. For restaurants, a few of the many important KPI measurements include the sales-to-investment ratio, food costs, labor costs, average ticket, table turns and occupancy costs.

    If you’re in the hotel business, some important KPIs include overall occupancy rate and average revenue per occupied room.

    If you’re a manufacturer, you’ll certainly want to look at things like the product return rate and net promoter score.

    If you’re in the business of selling advertising, you may want to focus on sustaining your customer base — so KPIs like customer retention rate, customer churn and repeat purchase ratio might make your list.

    And if you are in a membership-based, fee-for-service business, like a massage or fitness operation, you may want to monitor metrics like revenue growth per customer and time between purchases.

    KPI targets can differ within the same industry

    KPI targets can be different within the same industry, too. For example, in the restaurant industry, a steakhouse might aim for food costs in the range of 35%, while for a pizza restaurant, that number might be closer to 30%. But shoot for those numbers at a pretzel shop, where 20% would be considered high, and you could have a disaster on your hands.

    Different types of businesses in the same broad category (restaurants, in this example) can have very different target KPIs because of other changes in the business model.

    A pretzel shop generally has significantly lower sales than a typical steakhouse. They also may rely on impulse purchases in a high-traffic location, so they don’t need to spend the same amount on advertising as a steakhouse would. In addition, because its footprint is much smaller, a pretzel shop can pay less in rent (although it’s often higher when calculated on a per-square-foot basis).

    Related: Considering franchise ownership? Get started now and take this quiz to find your personalized list of franchises that match your lifestyle, interests and budget.

    Be aware of KPI repercussions

    When determining your KPIs and target ranges, you should also consider that any changes you make may have implications in other areas of your business.

    Going back to our restaurant example, the logical assumption is that we want to keep our food costs down. After all, each percentage point saved on food costs, all else being equal, will translate to a significant increase in profitability. But everything is not always equal.

    If you can reduce your food costs by eliminating waste, improving portion and inventory controls or establishing better systems for pricing or purchasing, then you could improve your Money Machine.

    On the other hand, if you had to sacrifice quality, raise prices unreasonably high or make your portions so small that your customers left dissatisfied, your reduced food costs KPI could have a severe negative impact on your overall profitability.

    In other words, anyone can decrease food costs down to 2% if they charge $50 for a burger. But how many will they sell?

    Likewise, you could reduce your labor costs in your restaurant by simply hiring fewer people. But if that results in poor service and unhappy customers, you may have missed the point of the exercise. So as you start identifying the KPIs and target numbers that will ultimately drive your business, bear in mind that changes to your KPIs may have unintended consequences.

    Categorize your KPIs

    Generally speaking, the KPIs for a small business can be grouped into several major categories: marketing metrics, sales metrics, production and financial metrics, and client satisfaction metrics. And these KPIs generally occur in that approximate order.

    Marketing drives sales. Sales drive production. Production drives client satisfaction. And client satisfaction (and the word-of-mouth it can deliver) drives repeat and new business. Effectively categorizing your KPIs, determining your target ranges and developing the right strategies to hit them will put you in a good position to achieve and maintain profitability.

    Related: Is Franchising Right For You? Ask Yourself These 9 Questions to Find Out.

    Get started with The Multiplier Model

    Going from small business to successful startup to scalable growth takes more than just good luck. It takes a system. Over the last 34 years, franchising consultant and growth expert Mark Siebert has been sought out by more than 70,000 executives looking to expand their companies. Out of those 70,000, only 5,000 had the right systems in place to go from successful to scalable. In The Multiplier Model, Siebert discusses the factors that determine if an entrepreneur is ready to scale their venture — and the best ways to get started. Read more.

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    Entrepreneur Staff

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  • 4 Things to Know About Private Equity Investors in Franchises | Entrepreneur

    4 Things to Know About Private Equity Investors in Franchises | Entrepreneur

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    Opinions expressed by Entrepreneur contributors are their own.

    Do you hope to someday bring on a private equity (PE) partner to accelerate your franchise business? If you’re a franchisor, this simple list should be at the root of every decision you make going forward as you build your enterprise, from now until you’re ready to sell or bring on a PE partner:

    1. Private equity buyers want proof of franchise model quality, specifically strong unit-level economics and positive franchisee validation

    This means to get top dollar, it’s not enough to have a strong franchise value proposition for franchisees. You must track system metrics and show positive trends over time. Collect franchisee profit and loss statements from the beginning. Standardized point-of-sales systems can help collect unit-level performance information that buyers will want to see. Franchisee satisfaction surveys should be implemented. If franchisee feedback isn’t strong, move quickly to address issues and communication gaps.

    Related: Thinking of Selling Your Franchise to a Private Equity Firm? Here Are 9 Ways to Build a Valuable Reputation

    2. There must be additional evidence of brand momentum through new unit openings, same-store sales growth, significant open whitespace and other growth opportunities yet available

    The operating model must be replicable, and there must be proof. For example, can you demonstrate that you open 100% of the units you sell? Are franchisees ramping to profitability within 18 months or fewer? That is much more valuable and important than selling a bunch of multi-unit licenses that never open. Do franchisees experience a solid cash-on-cash return? Buyers especially get excited when they see existing franchisees returning to buy new expansion units.

    Private equity sponsors want to see strong growth potential within their own planned hold period. But they also want a terrific growth story for the next sponsor as well to command a good exit price. Franchise businesses can trade between private equity (PE) sponsors multiple times. Technically, this is called a “secondary buyout” (whether it’s the second PE-to-PE transaction or the tenth). I prefer to think of it as the PE Profit Ladder. At each step, new sponsors need to see a compelling long-term growth story for the business to command premium enterprise value.

    3. If No. 1 and No. 2 are missing or weak and if the evidence doesn’t match the hype, PE quickly moves on

    While you may be selling franchise licenses, that in and of itself doesn’t make your business attractive. It validates that you’re good at selling franchises, not that PE will find your company attractive. You may have even received (or paid for) flattering press coverage. Are you starting to believe your own press? Buyers may be calling you with effusive, “We’d love to talk about your business,” messages. After basking in the warmth of some positive market attention and getting these phone calls, the transition to engaging seriously with a seasoned PE buyer who assesses your business with a swift, clinical eye can feel like suddenly walking into a freezer. Where did the love go?

    Related: Is This the Right Time to Sell your Franchise to a Private Equity Firm?

    4. This is where your franchisee-franchisor relationship karma will finally catch up to you

    Your franchisees have tremendous power over your sale outcome. If that idea strikes fear into your heart, you know where your work begins. Call it “turnabout is fair play,” “revenge of the franchisees” or whatever you like.

    If you’re a franchisor, your ability to sell your company to private equity at a high price with great terms depends on the quality of your relationship with your franchisees, strong return on investment for franchisees and the quality of operators you attract to your system. I’ve seen this collapse of the hype-machine dawn on sellers far too late. PE’s brutally cool, fact-based assessment and the importance PE attaches to franchisee satisfaction, profitability and positive references about their franchise experiences can be jarring to some sellers. If you’re used to acting independently as a founder, it can feel like turning in your high school math test and getting it back with a bunch of red pen mark-ups. Whatever attention you are, or are not, currently investing to ensure strong franchisee profitability, the market will one day hold you accountable.

    Most PE sponsors want growth stories, not turnaround projects ripe with risk and headaches. Turnaround projects in franchising carry significant extra risks and uncertainties because of franchising’s distributed ownership model. For many private equity investors, franchise turnarounds just aren’t worth the effort within the available time or will only be considered at a steeply discounted price by specialist firms.

    If you or your banker diligently advertise that your business is for sale and months pass with no deal, this well-meaning effort effectively spreads the word to the buyer community that you tried to sell the business but have no takers. This creates a negative impression that you will have to walk back if you decide to wait and go to market again later. It’s like that house that didn’t sell and is finally taken off the market. Two years later, prospective buyers watching the neighborhood see it listed again and remember that it didn’t sell the first time around. They wonder, “What’s wrong with that house? What’s changed since the last time it was on the market?” If you land here, you need to hear the market feedback and make meaningful changes to improve the value proposition for franchisees.

    You are much better off fixing your franchise model first and only going to market when you have something truly valuable to sell. Franchising is a brilliant wealth creation model that performs optimally when franchisees can create a rock-solid return on their investment. If you remain focused on promoting and growing unit-level profitability, you will build a truly valuable system that will stand up to PE buyer scrutiny.

    Related: A Beginner’s Guide to Private Equity

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    Alicia Miller

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  • 3 Key Methods of Boosting Franchise Operation Sales | Entrepreneur

    3 Key Methods of Boosting Franchise Operation Sales | Entrepreneur

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    Opinions expressed by Entrepreneur contributors are their own.

    The old saying goes, “Sales cures all,” and that may be right, but how exactly does a savvy businessperson intending to grow a franchise go about boosting their sales numbers?

    My inbox and social feeds are filled with “helpful” pitches by marketing professionals — digital marketing, PR companies, lead generators, funnels, text marketing… the list seems endless. It’s vital, in considering all these come-ons, that you not confuse efforts and results.

    Think, for example, about how improvements in operations can compound sales growth. I call it the “10/10/10 Method:” By focusing on increasing daily customers, check size and visit frequency by 10% in each category, you’ll juice yearly sales in a disproportionality large way.

    Take Five Guys: Its average franchise location does about $1.2 million in yearly sales — roughly 220 customers a day averaging about $15.00 per check. If you can attract just 22 more people a day, and manage to up-sell one additional item on each check, things change dramatically. I recently sat down with Fransmart‘s CFO and ran the numbers: Yearly sales would go from $1.2 million to $1.59 million — a 32% increase by being just 10% better.

    Here are three ways to ensure that your 10/10/10 growth strategy is a success.

    1. Nail that trial period

    Most of your marketing budget, particularly in the early days, will be spent on getting customers to try your concept, so great operations and loyalty programs will keep guests coming back and spending more. Sweetgreen, for example, has a loyalty program that builds revenue by charging customers for extra perks, and it works. Rest assured: people will pay good money for a quality experience.

    Grand openings are, of course, vital. These events are usually held between a month before and a month after you open and should be designed to create a buzz in the market. Break through the noise by being creative; add a twist to your messaging so people won’t want to miss out.

    Be exhaustive in your research of the local market and tie your brand’s message and marketing into it. And, whether in tandem with opening events or in a separate effort, consider a discount or giveaway to give folks additional motivation to stop by. Give them a reason to invest, because good value and community support are equally vital.

    When that crowd inevitably shows up, capture it in every way you can — whether in photos, video — heck, rent a drone and show just how far the line goes. A giveaway or other tempting draw may be great, but there’s no incentive better than the fear of missing out. If the community sees a massive line, they’ll be through the door soon.

    Related: The 8 Rules to Live By in Franchise Marketing, According to Top Franchise CMOs

    2. Encourage frequency

    Repeat customers are the most profitable because you don’t have to re-market to them. If someone enjoyed their first experience, the instinct is to repeat it, in the process hopefully trying other products. There’s no marketing or incentive needed to bring these people back through the door: Your brand is the draw.

    Remember that marketing is an investment in repeat customers: it’s not a cost. Consider a customer who uses you two times a month and spends $10 each time: That person isn’t just the $10 they spend at that moment, but $240 a year and $2,400 over ten years. And that’s not even factoring in the word-of-mouth business they provide by bringing in friends.

    Another major component of encouraging repeat business is making sure customers can enjoy your brand in whatever way they want, which means having a quality delivery program. You may cringe at the cost of developing your own, and/or partnering with third-party apps, but remember: This isn’t just about building incremental sales but building a relationship with a repeat customer who will pay full price the next time they drive by your business. That’s worth an investment.

    Another vital consideration: The quickest killer of repeat business is making guests feel unsafe or uncomfortable. Great marketing might get someone through the door, but if they walk through a cobweb on their way in, it’s over. Ensure that locations are adhering to high standards of presentation, or all the other good work is wasted.

    Related: 3 Customer-Service Tips That Will Ensure Repeat Business (60-Second Video)

    3. Grow check averages

    I once asked the founder of a popular burger brand what percentage of customers also ordered its fries and maybe a fountain beverage. “Everyone does,” he replied. “Well, most everyone. I think most do.” We watched the line for the next 10 minutes, and less than one-third of the customers were also ordering fries and a drink. Why? Because there was a line out the door and the cashier was trying to move it along instead of suggesting extras.

    Once you have people in the door, you’re failing as a business if you’re not doing everything you can to maximize each sale. This is an art: You don’t want to apply undue pressure, but remember that you’re in business to sell, not just take orders.

    To that end, customer service is more than a warm smile. People want a valuable experience, and that means having their needs met. Businesses should be prepared to ask good questions, identify specific needs and offer the right products to meet them. That means making sure the staff is well-trained. Suggestive selling will lead to a better experience if it’s addressing a genuine need.

    Many businesses are turning to kiosks now to address the need for such selling. I love Wow Bao, an Asian concept in Chicago that’s nailing the ordering process. In the early days of the company, new customers were clogging the lines by asking a long series of questions when ordering, causing regulars to turn away and avoid the wait. In response, the company installed kiosks, and the check average went up by almost 20%! This has driven revenue growth while lowering labor costs and giving repeat customers a better experience… a truly winning formula.

    Related: Five Ways To Upsell Your Products And Services

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    Dan Rowe

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  • Why a Franchise Is the Best Long-Term Investment Strategy | Entrepreneur

    Why a Franchise Is the Best Long-Term Investment Strategy | Entrepreneur

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    Opinions expressed by Entrepreneur contributors are their own.

    While today’s economic landscape is uncertain, making the right choices to build wealth isn’t something to take lightly. Choosing the right investment is not something that comes naturally to most people. In many cases, people save money or invest in a 401(k) plan provided by their employer. Others take on more risk by investing in individual stocks or practicing classic principles like the 60/40 rule of portfolio diversification.

    No matter the expertise, there is always a level of risk involved when investing and there are other strategies to diversify your overall investment portfolio.

    Related: 7 Things You Need to Know Before Becoming a Franchise Owner

    Investments in franchising are an alternative

    Franchising can be a worthwhile option for those who want to expand their investment portfolio in the long term. It offers advantages with numerous benefits as a long-term investment strategy. The long-term growth prospects are exciting, and there are plenty of franchises (and their respective industries) to choose from.

    Many examples of franchise investments in the food and beverage or health and wellness industries exist. Subway, Dairy Queen and Anytime Fitness, to name a few. With these particular brands, franchisees benefit from substantial brand equity and it helps that they’re built on proven business models, training and ongoing marketing and back-office support, including financial management tools and access to capital.

    Several industries have recently been recognized for strength and viability even during turbulent or uncertain economic times, including the Great Recession of 2007-08 and the Covid-19 pandemic. These franchises have been referred to as recession-proof franchises, as many of them were called to the frontline to help provide baseline human and business services.

    For example, one industry that continues to prove itself during strained economic times is commercial cleaning. Franchising opportunities in commercial cleaning are plentiful and many brands have survived and thrived during past recessions and global pandemics.

    During the Covid-19 pandemic, commercial cleaning companies were relied upon to keep businesses (including hospitals, medical testing centers, doctor offices, grocery stores, etc.) clean and disinfected. Commercial cleaning suddenly became a topline business operation process as a redefined customer expectation, and the definition of cleanliness materialized. According to industry analysts, the commercial cleaning industry is expected to hit more than $468 billion in revenue by 2027. That’s a 51.67% increase over the market’s $308.7 billion value in 2020.

    Building on an existing model

    Master franchising is an investment many are discovering due to recent economic uncertainties. Master franchising involves taking control of a region or territory to expand unit franchises under the same brand umbrella.

    As an investor looking to increase returns, the master franchisor aims to invest in an established brand through territory ownership and selling unit franchise models to local entrepreneurs looking to go into business themselves. As the regional franchisor, the investor controls high-level business decisions, such as marketing and sales, while the party franchisee staffs, manages and executes at their independent location.

    The benefits of franchising go beyond just expanding your business reach. Engaged franchise brands help their franchisees in many ways, including financial management tools, marketing technologies and cash flow. By using your established brand, you can attract potential franchisees who may not have considered starting their own business otherwise.

    In addition, the benefits of franchising as a long-term investment strategy are immense. One key advantage is that franchisees make decisions and are their own boss, allowing them to run the franchised business according to their preferences. When a franchisor welcomes a new franchisee into its system, they ensure the franchisee is well-equipped to take on this new venture. This includes extensive training, support, assistance and guidance in every aspect of the business. This allows for greater flexibility and control over one’s career path.

    One significant benefit of franchising is that it allows investors to acquire a franchise and develop their own franchise company. This approach pays off as the franchise program provides access to a proven business model, which has been tried and tested in various locations. Additionally, franchising enables investors to open more locations under the brand, increasing the business they can generate. Buying into a franchise also means lower risk, as the brand network offers ongoing expert support while operating within an established business model.

    Another significant advantage is the opportunity to invest in an established franchise business product already developed and modified for market success while operating under a recognized brand. Additionally, franchisors often modify their franchise agreements to suit individual franchisees’ markets.

    Related: The Pros and Cons of Franchising Your Business

    Is franchising safer than a savings account or stocks?

    Recent events in the banking and financial sectors are concerning for many people looking to build a portfolio that can sustain their lifestyle through retirement. With bank failures like Silicon Valley Bank and others, investors are nervous about cash sitting in savings accounts (not to mention the next-to-nothing returns) while the banks ineffectively raise investment rates against inflation. Investors are looking for other vehicles to utilize their cash where they can earn a more substantial return with lower risk. This is where franchising starts to look safe, attractive and viable, especially given the scrutiny of the franchise purchase process.

    Franchise disclosure is a critical component of the process, offering prospective franchisees the opportunity to read about the rules, laws, and requirements before investing. The Franchise Disclosure Document contains a wealth of essential information, such as crucial operating details and locations of other franchise operators. This allows entrepreneurs, both experienced business owners and first-time investors, to make informed decisions about owning their business. The franchise rule requires franchisors to offer support to keep franchise operators’ employees and provides growth opportunities for owner-established investors.

    Franchising might be an exciting option for investors looking for new and creative ways to protect their savings while putting their money to work. As with any decision, due diligence, research and learning are always recommended. Additionally, franchise investment is a topic of conversation that investors can engage with their fiduciary, wealth or financial advisor.

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    Adam Povlitz

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  • The Best Video Marketing Advice for Franchise Brands | Entrepreneur

    The Best Video Marketing Advice for Franchise Brands | Entrepreneur

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    Opinions expressed by Entrepreneur contributors are their own.

    The ever-increasing competition among franchisors to get an edge on one another has led to some innovative marketing campaigns and initiatives. Amidst this backdrop, video marketing has become a vital component for many brands precisely because it can be utilized in so many ways. But it’s also created a complication of sorts — where to deploy video that best serves a wide variety of brand-related challenges.

    If you’re a franchisor who hasn’t yet developed a comprehensive video marketing strategy, there are three primary areas where you should concentrate your efforts: franchise development and sales, recruiting and training. Below is some advice on video usage for each of these important categories.

    Related: 5 Reasons Why You Need Video in Your Marketing Strategy (With the Stats to Prove It)

    Videos that increase franchise development and sales

    The last of the three areas of brand marketing with the highest value for video is sales development. And one of the best ways to communicate the social proof of your brand involves testimonial-style videos. Done right, what you’re actually selling is the full vision that the brand has to offer. Not just the “who,” “what” and “where” of your business model, but also the “why.” If you need to boost your sales outreach efforts, use testimonials that feature successful franchise owners who were once uncertain entrepreneurs — just like the target market you’re hoping to reach.

    To boost franchise development efforts, use testimonials that get real. Feature real people sharing real experiences that include the real ways in which their lives have changed for the better. Be specific! Communicate actual experiences that demonstrate the freedom and flexibility that comes with franchise ownership — especially your ownership prospects. Testimonials that feature the CEO in his office, sharing the details of your brand’s opportunity are great. That’s what most people expect to see.

    But you also need a second kind of testimonial — one that’s set amidst an on-location filming site. Imagine a first-person testimonial video that features a successful franchisee in their own backyard with their happy kids playing in the background. Now that could be anyone, including the viewer, who’s likely imagining themselves as a franchisee in your system while they watch.

    Videos that benefit recruiting

    Franchisors, whether an emerging brand or those who have already hit the magic 50-unit milestone, have a continuous need to fill their sales pipeline with high-quality prospects. New franchisees are the lifeblood of the brand, and each new unit awarded strengthens the system as a whole. And video can also be instrumental in helping franchisors recruit these prospects. If you’re going to deploy video for internal and external recruiting, the key is to feature content that showcases your company culture. Make your key differentiators the star of the show by featuring the aspects of your business model worth investigating.

    Shoot videos that demonstrate how existing franchise owners feel about working with the brand, highlighting the types of things that keep them excited about getting up each and every day. Video that provides social proof becomes believable in the viewer’s eyes. They’ll soon understand why the brand has changed other people’s lives for the better. And naturally, they’ll want that for themselves as well.

    Related: Connecting With Your Target Audience Through Video

    Videos that benefit training

    A great deal of franchisors take their comprehensive training programs seriously. This is the period in which you’re communicating how to own and operate your franchise opportunity to a captive audience. So, captivate them! Use engaging and entertaining (read: not boring) videos to introduce your business model to new owners.

    Studies have long since determined that we learn best through visual mediums, but newer information reveals that we also retain much more of the material we’re presented than with written guides and manuals. Instructional videos — especially those related to job safety — are vital aspects of the business model to communicate with new franchisees. And nothing gets the point across about workplace hazards and best practices for safety on the job than training videos.

    Related: Why Video May Be the Most Effective Format When It Comes to Training New Franchisees

    Hopefully, this information has been a helpful guide for deploying video that will enhance your overall brand marketing efforts. If you’re unsure where to begin, simply think about the three areas where video can have the biggest impact: franchise development and sales, recruiting and training. When it comes to your brand’s value proposition, the “who,” “what” and “where” are certainly important features. But visual storytelling is what best demonstrates that all-important “why” that you’re trying to communicate to your desired target market.

    After all, there’s no reason to keep that answer all to yourself — it’s an aspect of your business model that you should be sharing with the rest of the world!

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    Trevor Rappleye

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