by Larry Reed | Jul 1, 2023 | Uncategorized
As a franchise owner, you will come up against many challenges in your career. One of the significant challenges that you may face is referred to as the “coattail effect.”
When a franchise experiences the coattail effect, this means that other franchises of the same brand are failing or doing poorly. Due to the performances of those other locations and the loss of reputation for the brand, you may see a drop in sales and the number of customers coming into your store. It could even go as far as you needing to close your business.
Luckily, there are ways for you to work to avoid these problems. Below are three methods you can use to overcome the coattail effect.
Set Yourself Apart
If franchise locations of the same brand as you are failing, then it doesn’t make sense for you to continue to do what they are doing. In order to get over the coattail effect, you should look for ways to make your location stand out.
If you can find products or services that other franchises don’t offer, highlighting them can help you attract customers. You should take advantage of anything that sets your store apart from other franchises of the same brand.
Focus on Local Marketing
A big part of working with a well-known franchise is that you have the chance to benefit from national and regional marketing. But if your brand is not doing well, then that type of marketing is not going to help you as much. Instead, you should put your focus on local marketing.
You can promote your store by getting involved in the community, conducting local advertising campaigns and finding ways to connect yourself with local organizations. Building a loyal local customer following can significantly help a franchise avoid the coattail effect.
Prioritize Customer Experience
It goes without saying, but customers are vital to the overall success of a franchise. You need them for sales, and you need them to help spread the word about your franchise’s products and services.
So, if you are trying to overcome the coattail effect, you should do all that you can to give your customers a one-of-a-kind customer experience.
This can be done by creating an atmosphere in your franchise that is welcoming and warm. Not only that, but you should prioritize personal interactions that leave a lasting memory. Customers will want to visit your location more!
If you are ready to start your career as a franchisee, get in touch today to get started with a free consultation.
by Larry Reed | Jun 15, 2023 | Uncategorized
Your business’ ability to make a profit is important for it to sustain itself and remain competitive, but it is also important for you as the franchise owner. It’s important to discuss with your franchisor to understand better how you, the franchisee, will be paid as well as how much.
This blog post will discuss three factors that contribute to franchisees’ earnings: a loyal customer base, sales revenue and cost savings.
A Customer Base:
It should come as no surprise that the success of a healthy business is dependent on a thriving customer base. Customers use the services or products that your business provides, but they also help spread the word about your business, which can lead to more customers. As your customer base grows, so will the amount of revenue that you bring in.
As a franchise owner, your salary is dependent on the amount of profit your business makes. If you are struggling to build a strong customer base, then you will see that reflected in the amount of sales as well as what you will make. But if your customer base is strong, then you should see an increase in your earnings.
Sales Revenue
While sales revenue may seem straightforward to understand, there is plenty that goes into increasing your sales revenue. But it, too, has a decisive role to play in what you as a franchise owner will make. To increase your sales revenue, you will need to change the way things work in your business.
New marketing plans that boost your social media campaigns, and include local advertising, will do a lot to build your name and attract more customers. It would be best if you also took it upon yourself to research sales trends. That way, you can determine how to stay competitive by tailoring any marketing efforts and possible offers to customers based on popular trends.
Cost Savings
Your franchisor has built relationships with vendors that provide equipment and supplies for your franchise. Oftentimes, these relationships include discounted prices for the things that you need.
This can save your business money—and, in turn, increase your personal earnings as your business will not spend as much buying necessities.
Are you ready to start your career in franchising? Get in touch today!
by Larry Reed | Jun 1, 2023 | Uncategorized
As a franchise owner, bringing in more revenue is always a top priority. There are several strategies you can use to increase your profits, but in this blog, we will focus on three areas: keeping employees happy, expanding your business and taking advantage of what e-commerce has to offer.
It is important that you smoothly transition into using these tactics. You do not want to do anything that may disrupt the flow of your business and cause financial woes.
Keeping Employees Happy
One of the most important factors in running a successful business is having a happy and motivated team of employees. When your employees are satisfied and feel valued, they are more likely to go above and beyond for your customers. This can lead to increased sales and customer loyalty.
To keep your employees happy, you can offer benefits like flexible work schedules, paid time off and opportunities to help them develop professionally. Making an effort to recognize your employees’ hard work can also help to boost their morale!
Making More Revenue by Expanding Your Business
Expanding your business is another effective way to bring in more revenue. This can include opening new locations, adding new products and services or targeting new customers.
Before you make any major changes, it’s important to know where your business stands in terms of finances to ensure that the expansion will not have a negative impact.
Using E-commerce
E-commerce is becoming increasingly important for franchises. You can reach a wider audience and generate more sales by selling your products or services online. This is especially important in today’s digital age, where many consumers prefer to shop online.
To get started with e-commerce, you will need a website and an online store. There are several popular platforms that can help make the process of building your website easier.
When creating your website and online store, you should aim for a website that is easy for your customers to navigate. This will not only keep them coming back, but it will help to attract new customers.
Are you ready to start your franchising career? Get in touch with us today to learn how we can help you!
by Larry Reed | May 15, 2023 | Uncategorized
For many potential franchisees, the fees and costs that come with owning a franchise can turn them away from following through the process of purchasing a franchise. Luckily, there are funding options available for those who need help when it comes to financing their franchise.
One of the more popular sources of loans is the U.S. Small Business Administration. The government doesn’t directly provide these loans but works through its partners to help finance small businesses.
This blog will discuss the most common types of SBA loans, how you can become eligible for an SBA loan and the benefits of these loans.
Types of SBA Loans
Each type of SBA loan has different terms and is designed to help borrowers meet their specific needs. The SBA 7(a) allows borrowers to take up $5.5 million for their financing needs and is the most common type of SBA loan.
If you need help with purchasing equipment or real estate, you will want to consider the CDC/504 loan. For those looking for a smaller loan, the SBA also offers micro-loans of up to $50,000.
You must know what you plan to use the money for as some of the loans mentioned are more flexible than others. CDC/504 loans are meant strictly for fixed assets. Micro-loans also have some restrictions, but the SBA 7(a) can be used for nearly anything.
Eligibility
While the requirements for eligibility may differ somewhat depending on the type of loan you need, there are some general requirements that everyone will need to meet.
For starters, your business must be in the United States. It also must be a for-profit business in an eligible industry, and you must prove that you have a genuine need for the loan. A good credit score and a history of investing in your business may also be required by lenders.
Benefits of an SBA Loan
A big reason for SBA loans’ popularity is the amount of money that can be loaned out. You could take a loan of up to $5.5 million depending on what your business needs.
Of course, if you are going to take a loan, then will need to repay the money. When it comes to SBA loans, you will benefit from having a longer timeframe in which you must repay the loan. You also have access to resources to help support your investment, such as seminars, courses and networking events through the SBA.
If you are ready to leap into the world of franchising, get in touch today!
by Larry Reed | May 1, 2023 | Uncategorized
Every franchisee wants to turn his or her franchise into a successful business that benefits its community. But as with every industry, there are pitfalls that franchisees must look out for. One that is common in the franchise industry is referred to as the “coattail effect.”
In franchising, the coattail effect refers to a situation where franchisees who are prosperous and doing well may be forced to shut down due to the failures of franchisees who own a franchise of the same brand. Customers may have bad experiences with a franchise of a specific brand, and then that stigma spreads to all of that brand’s franchises. It’s an unfair situation, but luckily, there are ways to overcome it.
Below are three methods that may help franchisees to beat the coattail effect.
Change Up Your Business Strategy
One way to avoid the impact of the coattail effect is to change your business strategy. If you are following a similar strategy that has led to the fall of franchises like your own, then you should look to switch up what you are doing. Take the time to thoroughly look over your current business strategy to find areas where improvements can be made.
Once you have identified weaknesses in your current business strategy, you can change them and present them to your team, and then eventually start to implement them in your day-to-day routine.
Amplify Your Marketing Efforts
Your customer base is vital to the health of your franchise. If you are worried about the coattail effect harming your standing with your customers, you should consider giving your marketing strategy a boost to let your customers know your franchise is still trustworthy. The better you can communicate with your customers and assure them that nothing has changed, the more likely they are to come around.
This change in marketing tactics could be done through email and social media. You could even offer customer appreciation deals! You will want to do all you can to let your customers know they are valued.
Communicate With Your Franchisor
Your relationship with your franchisor is important for many reasons, but when it comes to dealing with the coattail effect, it’s important that you can communicate any concerns you may have.
Together, the two of you can work on finding solutions to your problems.
If you are ready to start your career as a franchisee, get in touch today to get started with a free consultation!
