Owning a franchise might seem like a dream—proven business model, built-in brand recognition, and support from the franchisor. But let’s be real: it’s not all smooth sailing. In today’s episode, we’ll dive into the biggest hurdles franchise owners face and how to overcome them like a pro. From managing corporate restrictions to handling financial pressures, we’ll break it all down and set you up for success!
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Owning a franchise can feel like playing a game where someone else makes the rules—except the rulebook is 500 pages long and constantly changing. Let’s talk about the major roadblocks:
Imagine this: You walk into your store, and everything is running like a well-oiled machine. Your team is thriving, your customers are happy, and your profits are climbing. This is the dream, and here’s how it can happen:
Success in franchise ownership isn’t about luck—it’s about following a solid game plan. Here are the guiding principles:
It’s time to roll up our sleeves and get tactical. Here’s how to handle the biggest challenges:
You’re ready to take control of your franchise journey. Here’s your action plan:
So I have a question. How are small business owners like us who are spending sixty plus hours a week working in our businesses and are still struggling to make ends meet? We have no time to spend with family, friends, or the things we value most in life. We feel trapped inside of our businesses, and it is consuming our lives. How do we get the freedom to be able to work on our businesses and not in them?
That is the question this podcast will give you the answer. My name is John Nichols, and this is expansion code radio. What's up, everyone? Welcome to today's podcast. If you're a franchise owner and thinking about becoming one or just love a good business challenge, you're in the right place.
Today, we're talking about the reality of owning a franchise. Because let's be honest, it's not always easy as plug and play. You've got rules to follow, expectations to meet, and a whole lot of responsibility on your shoulders. But don't worry. I'm here to help you navigate the chaos that came out on top.
Let's get into it. So the first thing I wanna talk about today is the problems, the challenges of owning a franchise. Owning a franchise can feel like playing a game where someone else is making the rules, except the rule book is 500 pages long and constantly changing. Let's talk about the major roadblocks in owning a franchise. So the first one is limited control, maximum responsibility.
You have to follow the franchisor's guidelines, which can limit creativity and decision making. But guess who's still on the hook for making sure everything runs smoothly? Yep. That's you. The second one is corporate versus local conflicts.
The franchise or might roll out marketing strategies that don't fit your local markets. Ever tried selling pumpkin spice lattes in Florida in July? Not fun. The third one is financial pressure and fees. Royalty fees, marketing fees, supply costs, these can all eat into your profit margins, and I mean really fast.
Number four, employee and customer expectations. Your employees expect leadership and customers expect consistency. But balancing happy customers and providing quality service and expect and meeting corporate expectations, it's all one big juggling act. Plus, you've got your employees that you have to keep happy too. Sometimes it can just be really hard.
So I just really wanna kinda go into some of these four problems real quick and just understand how difficult, and then on the flip side, sometimes how easy it can be. But here's the thing about the problems, is that when I first opened my first UPS store, I had this mindset of still being an employee for someone else. So I thought that we were all equals. And when I asked people to do things, I got pushback on it because I went into this whole situation as, hey, I'm your friend. I'm an equal.
We are the same. And what I figured out is that you can't treat people that way. You can't give people expectations that when they think that you're a friend and not their employer, then they view you differently. And so I had to learn real quick, like, that I had to had to make a distinguished boundaries between employer and friend. And I can be friendly, and I can be a good guy and all this other stuff, but I come up with this philosophy is firm but fair.
And so I will listen to people's complaints and try to be fair about things, but also too, I set down firm expectations. I started doing this upfront, but when I first opened up, I didn't do that. I ended up having to fire three different employees because they wouldn't do what I said. So the big thing here is is that whenever you open up your first franchise, get out of the mindset that you are an employee and that you are their equals and that you are your or that you are their friends. You are not.
You're their employer, and you can be friendly, but there is a big distinction between those two. But here's the thing. Where there are challenges, there are also opportunities. And if you play your cards right, franchise ownership can be incredibly rewarding. So let's talk a little bit about the possibilities now.
The rewards of franchise ownership. Imagine this. You walk into your store. Everything is running like a well oiled machine. Your team is thriving.
Your customers are happy. Your profits are climbing. This is a dream, and here's how it can happen. Number one, brand recognition and a built in customer base. Unlike starting a business from scratch, you're tapping into a name that people already know and trust.
This is a massive advantage. I just remember that from a whole a long time ago, watching other business owners that start from scratch and having to build a brand. With a franchise, you already have a brand. Number two, franchiser support and training. Many franchisees provide strong training programs and resources to help you succeed.
You don't have to figure it out all alone. That was the great thing about the UPS store. They provided massive training upfront and then ongoing training every year. Number three, scalability and growth. If you master one franchise location, you can expand it to multiple locations and build real wealth.
And this is so true. I went from one store in 02/2011, and by the time November 30 rolled around in 02/2014, I had 11 locations. You can grow, you can grow fast, and it's possible. Number four, community impact and leadership. You get to be the leader in your community, create jobs, make a real difference, all while running a profitable business.
And that there's a great thing about this. So I wanna tell you a story about this one particular thing, about the community impact and about being having leadership in the community. So I really do believe that you need to join your local Chamber of Commerce, and you need to join some sort of community give back organization like the Rotary Club or the Wines Club or some other other nonprofit organization that does service work for the community. It's really important to do this, and you get into these organizations not to gain customers, but just to give. Let me repeat that.
You join one of these organizations, like the Rotary Club, to give back to the community and to help the club and not look for business. Now here's the great thing about doing this is that business will automatically come to you. When you start showing leadership inside of these clubs, inside of these nonprofit organizations like Rotary, People will start thinking of you as an expert, as a leader in whatever industry you're in, and they will come to you for stuff. You will never ever have to ask for business. It will come as a byproduct of you just showing up, being a leader in your industry, and helping your community out.
So these are the possibilities to turn things into reality. It all starts with the principles of successful franchise ownerships. So let's break it down. The key foundations of a successful franchise. The franchise ownership, it isn't about luck.
It's about following a solid game plan, and here are some guidelines and principles to doing that. Number one, know the franchise inside and out. Read the fine print, understand the contract, and know exactly what you can and cannot do. Surprises aren't fun in a business. Number two, financial discipline is key.
Budget for fees, prepare for slow seasons, and always keep an emergency fund, and I mean always keep an emergency fund. A little planning will go a long way. Number three, leadership over management. A great franchise owners don't just enforce the rules, they inspire teams. Build a strong culture, and everything else becomes easier.
And number four, adapt, but stay consistent. Follow corporate guidelines while making small and smart adjustments to fit your local markets. Find the balance. I wanna go back to the very first principle, know the franchise in and out. So back in 2020, we were looking to expand it to a different type of franchise.
And it was a up and coming franchise, and it was basically a drive through convenience store franchise. And I'm not gonna name the franchise, but it was a drive through convenience store franchise. And as we were in negotiations with them, they gave us the the franchise book for us to read through. It was the franchise agreement. So they gave us the franchise agreement for us to read through.
And so they gave us one, we read through it. We found a couple of things that we wasn't sure about. So then we asked them about it. They said, oh, yeah. No.
No. We can we can go on and change these couple of little things in our franchise agreement. We said, okay. So then we went down and met with them in Miami. Now you gotta remember, this was during COVID.
This was, like, May of COVID. And we met with them. They brought out, they said, hey. Listen. At the end of the week, we're coming up with a new franchise agreement.
All your concerns should be addressed in this. We said, great. So we flew back to Knoxville, and guess what happens? We get the new franchise agreement. Not only did they address what we had complaints about, they made them worse.
So at that moment, we decided that we did not like the values, that this company had and that they were very tricky about with the what they were doing. They were trying to hide things, and we just pulled out. And we didn't we did not go with that franchise at all. So I don't own any of those, drive through convenience stores. And the reason why is clearly because it didn't match my values.
And so the thing is is that knowing a franchise in and out, that franchise agreement is key. And if you don't know what to look for, hire a lawyer and have a lawyer look through it. It's vitally important that you know what you're getting into because you do not want any hidden fees or anything hidden later on that is gonna cause you to regret buying into a franchise. Now that we know the principles, let's talk about how to put them into action with real world strategies. How to overcome franchise challenges?
It's time to roll up your sleeves and get tactical. Here's how to handle the biggest challenges. Number one, master corporate relations. Build a good relationship with your franchisor. Be proactive.
Attend meetings. Give feedback. Don't just complain. And that there I'm telling you right now, folks, that there is is huge. Don't just get into a meeting and just complain and go complain and complain about everything.
Nobody wants to hear it. We all know that there's problems inside franchises. I don't need somebody that is a negative nanny just complaining all the time. Try to be as positive as you can in these network meetings. Number two, localize your market.
Even if corporate runs national ads, supplement them with local events, social media, and community engagement. And I also say supplement these things with in store marketing. You've already got these people in there already, so you might as well do some in store marketing. Number three, optimize your operations. Streamline schedules, cross train employees, and use technology to improve efficiency and cut cost.
And number four, develop a strong team culture. Investing in training, recognizing hard work, and creating a positive environment so employees stick around. And so I wanna talk a little bit about team culture. And so it all starts with you. Just remember this.
Everything runs downhill from you. The way you run your franchise, your attitude towards your franchise, your attitude towards customers, your attitude towards employees, your attitude towards everything. Attitude in your franchise is 100% everything. And so when saying that, sometimes you have to lead from the front by being proactive, and you have to to take action and do things actually show your employees what it means to lead. So a prime example of this right here is that at one of my locations, I kept having employees saying, hey.
It's not part of my job to clean the bathroom. And so I went into that location, and guess what I did? I cleaned the bathroom. And, I mean, I cleaned it really, really good. And then I didn't say anything.
I just hung around, talked to the employees and stuff. And then when and when the employees went in to use the restroom, they were just like, oh my gosh. This this bathroom is spotless. It's so clean. Who did this?
And I said, I did it. I said, because it is part of your job to clean the bathroom. I said, and if I and if I'm willing to clean the bathroom and do and clean the bath and if I if I am willing to clean the bathroom, then you should be willing to clean the bathroom too. It's you guys are the ones using this, not me. And so if you were constantly using the restroom here and this is your bathroom, why would you not want it to be clean?
And so by leading it this way, leading by example really prove to my employees that, hey, this really is part of it. On top of that, it was it's part of my employee handbook. But I didn't wanna go and say, hey, you've gotta do this as part of the employee handbook. Instead, I led by example and show people that be owning the franchise, I'm not above cleaning the bathroom. I'm not above taking the trash out.
And I did that also too while they were there. I gathered up all the trash and took it out for them. Here's the thing about it is, you can't be too big for your employees. You can't be too important for your employees. You have to show them that you can do the same job that they do, and you're happy to do it.
And that there's one of the things that being a good leader in your franchise will show. And so develop a strong team culture, this is part of it. You have to lead by example. Now these strategies are powerful, but to make them work, you will need concrete action plan. So let's wrap this up with some next steps.
So the next steps to franchise success is a action plan. You really need to take control of your franchise journey. And so here is some action plans to take care of that. Number one, audit your franchise operations. Take a hard look at what's working, what's not working.
Make a list of areas of improvement. Number two, create a financial game plan. Set a budget. Review fees. Track your numbers.
Financially aware of everything is really key, and I'm gonna talk about this in a story in just a minute. Number three, engage with corporate and community. Strengthen your relationships with both corporate leaders and local customers. Find ways to bridge the gap between them both. And number four, train and empower your team.
Invest in your employees. The better they perform, the smoother your operations will run. So I wanna talk real quick about two things. I'm gonna give you two little stories. The first one is create a financial game plan, and it says set a budget, review fees, track your numbers, weekly, financial awareness is everything.
Well, that's true. The one thing that we do in our organization is that we track our numbers daily against the same numbers the previous year, the previous month, the previous day. Now sometimes the days don't always match up, so let me say that upfront. But you're but you're basically matching days from Monday through through Sunday because that is where they were open seven days a week, but it's basically the the same week in that month. So the numbers don't always match up, but now that we're open seven days a week, it's a little easier to match numbers up that way.
But they're still gonna be skewed. You have leap year, they really skews it off two days, and then then you actually push forward every year one day. So just to give you those kind of insights to that, but it's a great thing to be sure and track your numbers every day. But on top of that, though, when you look at what's working and what's not working, the one thing that we did years ago, and this was I don't know. It wasn't really that long.
It was probably about four years ago, is that we mystery shopped our competitors on printing because we wanted to see if we were too high, too low, and where we stood within the mix. And so we mystery shopped probably six or seven of our competitors in the printing market. And what we found out is that, first of all, we were not charging enough for our printing. And second of all, is that our turnaround times were way quicker than our competitors. So what did we do?
We raised our prices and at least matched our lowest competitor, and kept give kept providing that great service and turnaround time. And what this did, it it really made a big difference. Our customers were happier, and we did not get any pushback on the price because when they went to our competitors, they found out that we are the same price. And I first of all, I don't wanna be competing on price because that means that I'm a discount location. And if you've ever been into a UPS store, we are not the cheapest place in town.
I want people to come in because they have an extraordinary customer experience, and we're able to turn a product around quicker than most everybody else. And so that there was one of the big things that we did. And so this is part of the action plan stuff that you need to do. You really I really encourage you to give you some homework. Go mystery shop your competitors and see what the prices are so that this way you know whether to adjust, whether to come down a little bit if you're too high, go up a little bit, and figure out if your customer experience needs adjusting and figure out if your turnaround time needs adjusting.
These are really huge things. Now the next story I wanna talk about is train and empower your employees. And I probably told this story before, on one of my other podcasts, but guess what? You get to listen to it again because it's a great story. And so the one thing about empowering your employees is that if you're able to give them a true dedicated job inside of what they do.
Now my managers, they really do all kinds of things, but I encourage my managers to give each employee a dedicated kind of job. For example, in one of my locations, we've got an employee there for a really long time, and she's really good at notaries. And so she is our dedicated go to notary person because she knows everything. It's not to say that everybody else can't do a notary because everybody's been trained and everybody can do a notary. But we turn around and let her take the lead on notaries.
I have another employee in the same location that they take all the photos for passport photos. It's really it's really coolest thing I've ever seen, and she is so good at it, and she has trained everybody else to do this too. Now here's the key. When you give somebody a dedicated job, everybody else needs to know how to do that job, and here's the reason why. Because if they go to lunch or if if it's their day off, you don't want your employees saying, oh, well, Ginny's off today.
You're gonna have to come back tomorrow to get passport photos. Or Eric's off today. You're gonna have to come back tomorrow to get a notary. We never wanna turn anyone down. But if you make them a key person for that particular thing, it gives them power.
It empowers them. It gives them ownership of their job. This is a great thing. I've got another employee that she's really good and fast at putting up the mail for our private mailboxes. So what do we do?
Hey. Listen. It's your job to put up the mail. It's your job to to input all the packages that come in. And you know what?
She does a great job at it, and she's really great at it. But guess what? Everybody else knows how to do it too. And so on her day off or while she's at lunch, guess what? Somebody else does the job too.
It's all about empowering your people and training them how to do things and cross training everybody to do the exact same job. But give your people a lead position in doing one of the things that they do in the store. So I'm just telling you right now, this right here will really make things run a lot better and a lot smoother, and you'll have more dedicated employees. You'll have loyal employees if you do this one trick. Franchise ownership comes with its fair share of challenges.
But with the right mindset, principles, and strategies, you can turn those challenges into massive wins. Remember, success isn't about avoiding problems. It is about knowing how to handle them. Thanks for tuning in today. If you found this valuable today, please be sure and share this episode with another franchise owner who really needs to hear it.
So have a great day, and folks, I will see you on the next one. Thanks a bunch for hanging out with me today. This episode was jam packed with golden nuggets to fuel your business journey. If you found this episode helpful, why not share the love? Pass it along to a friend who's on the same journey as you.
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Catch you later and have an amazing day.