Why is it Difficult to Sell our Franchise?

For the last six years my wife and I have enjoyed an income well above what we could have earned working for someone else. Our customers love what we do. We have written a franchise agreement that we think is as success filled (for the franchisee) as our business is.

Our franchise has all the benefits of real estate investing if not more. We know that our business can be successfully duplicated by others because we now have three other people in different parts of the country running businesses equally as successfully based on our model and using our products and systems.

The problem is that we don’t seem to be able to sell a franchise. We spent ten thousand dollars having a marketing company prepare a campaign for us but I am now of the view that we would have had better value for money if we had thrown a ten thousand dollar party.

We don’t have unlimited money to throw at this and even if we did there wouldn’t be any point we are in business to make money not spend it. We would be happy to have a partner take over the marketing and sales under some sort of business arrangement or we will keep trying ourselves, but where do we get a campaign that we know will work before we have to throw more money at it?

The frustrating thing is that we know of a massive market opportunity that we are ready willing and able to share with others under an arrangement that is a win for us, a win for them and a win for the customers but no one seems to want to know. Is success out of fashion?

Brad Sugars answers

Just because you think that a particular business model will make a great franchise doesn’t make it so … and your inability to sell your concept as a franchise means you need to go back a couple of steps and re-evaluate the premise of your model.

First, know that individual franchise units are tested in a lot of different markets and geographic areas before they go national or international. And that is based on a lot of up-front knowledge, research and information about the market that needs to be served.

You can also get great information from what is already working. What is working for the three people who are using your system? Do you have their testimonials? Are they using your products and systems exclusively or their own under your banner?

Also, what doesn’t work about your system based on the feedback of people who didn’t buy?

Find out what is working from three people who are using the system, and a better approach may be to simply sell the products and system as a “turn-key” business practice versus a full-scale franchise.

Know that so-called professional services and “white-collar” franchises are tough to leverage because you don’t have “ brick and mortar” and you rarely have a “product” to sell. You are selling the “invisible” – even if it’s a “relationship”— which is what real estate (as business coaching) tends to be.

All the best.
Brad Sugars

    • bob
    • June 14th, 2011

    There are companies that will handle your franchise sales – some of which will perform on straight commission, provided you have a viable offer. Many of the companies (as you mention) that charge an upfront fee are somewhat less concerned whether you make a sale or not. http://www.seagus.com is a straight commission franchise firm you might consider

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