How to Develop a Franchise System, Part 2
A few blogs ago we spoke about Jason Puleio's The Barker Lounge, a dog day care franchise. In that blog entry we identified how Jason has had success in developing his franchise system by focusing on entering into agreements with individuals who are a good match for the system and the business. That inquiry led us to look at another one of our franchisor clients, Sir Grout, a business that provides grout and tile cleaning and restoration services.
Since the issuance of their first UFOC in October of last year, Sir Grout has sold six franchises, taking a deliberate approach to laying the groundwork for a franchise system. Another large franchise deal is in the works. Jeff Gill, one of the two principals (Tom Lindberg is the other) says that most of the franchises so far have come from previous acquaintances and word of mouth, built upon the business reputations of the two principals. They have taken a careful and economic approach to marketing, with a focus on developing their website and finding advantageous placement on other franchise oriented websites.
The franchises they have established have succeeded, which supports their growing reputation and builds on the word of mouth support. Jeff says this success is because they have adhered to their carefully developed business model and training practices that were defined in their UFOC (now FDD). In fact, says Jeff, "Every time someone has slipped a little, we have been able to pinpoint where they are struggling at the point where they deviated from the business model." Jeff says one key component is the availability of the principals. They have always made it a priority to be responsive to franchisee problems.
Jeff notes that the economic downturn has not impacted them as much as some other franchise systems, because they present a low cost alternative to home improvement. "We're a good alternative to a major home repair," says Jeff, "Our service gets you a bathroom that looks like new, as opposed to the huge expense of a new bathrooom."
The principals also place a priority on advertising, which they see as crucial to building confidence in the system. They require their franchisees to spend a minimum and encourage them to do more. In this business, says Jeff, "the more advertising you do, the more you make." However, conscious of the fact that they are a low cost franchising option, they look for inexpensive advertising options, so that they can increase the exposure without increasing the costs. For instance, by investing in an SEO specialist, they have gotten all of their franchisees placement on the first page of a Google search.
In difficult economic times, the recipe for success seems to always include personal attention to the franchisor-franchisee relationship and a focus on keeping costs down without sacrificing quality. It has worked for Sir Grout. We will be examining the success and struggles of other systems as we continue to analyze what works and what doesn't in this volatile economic landscape.
