What do you do when franchise sales are lagging? How do you respond? Do you blame the economy for your low sales? Do you blame your sales people? Do you look for excuses beyond your sales process? There is not necessarily a one-word answer to these questions; however, I would like to walk through some suggestions and strategies to help out. There are a number of areas to evaluate including franchisee lead flow, qualification process, sales representatives, franchise brokers, review and monitor sales pitches, franchise sales software program, discovery days, proper disclosure, follow-up, and going for the close. Let’s take a look at each of these one at a time.
1. Lead Flow – The obvious and most important to ask when sales are low is, “What does my lead flow look like.” If lead flow is down let’s evaluate why. Are your current marketing avenues working? What portals are you on? Should you exhibit at trade shows? Is your marketing message appropriate for the current franchise sales environment? Have you made any recent changes and monitored the effectiveness of these changes? It is important to remember that you do not want to do a total make over all at once as you will most likely change too many variables and be unable to pinpoint what led to the increase in leads and ultimately increasing your franchise sales.
2. Lead Qualification – This is an important avenue for your sales process. What are you doing to qualify your prospective franchisees? Are you sticking to your requirements and not lowering your standards? Have you been monitoring what your franchise sales people have been saying? It is important in the sales process to stick to your program, otherwise, you end up having discovery days and prospective franchise sales meetings with people that just waste your time.
3. Franchise Sales People – The next step is to evaluate the people you have in place running your sales department. If you are a young franchisor, the best sales person is the founder of the company. No one can sell with the same passion and charisma that the creator has. If you have sales people in place re-evaluate if they are the right people. What are their closing percentages? If they are not performing, let them go and find someone else. It might be hard, but it will hurt even more if they cannot sell and your franchise company suffers because of it. You will also want to examine how your franchise sales people are being compensated. Usually you will want to have a small base or a draw with a nice commission structure to motivate them to sell.
4. Franchise Brokers – Often times the idea of franchise sales brokers comes up when working with my clients as to whether or not they should use this as a resource. As a core value, my recommendation is to not use franchise sales brokers as they tend to take a large chunk of your franchise fee, which you need, and they have conflicting interests. However, utilizing brokers in as a supplement to your in-house sales team is something worth considering. Again, when choosing brokers you will want to be very careful which company you work with and be quick to pull the plug if there are no results after 6-9 months.
5. Review and Monitor Sales Pitches – One of the best ways to assist your sales team is to review and monitor their sales calls. Be sure to comply with any legal requirements prior to listening in to their calls or making recordings as there are many states that have specific rules. This is a great way to find out what your people are actually saying and more importantly to help them improve. It is as raw as it gets and allows you to completely dissect their presentation and sales skills. Very often you will uncover that your franchise sales person has deviated rather far from the basics. As it goes in sales, it seems that the more you stick to basics the better you do.
6. Franchise Sales Software – What kind of software program or sales monitoring system are you using? Do you have one? If you don’t, you need to get one ASAP! You need to be able to manage your franchise sales people and the franchise sales of your company. There are many different kinds of CRM’s and sales software programs that are rather inexpensive including Salesforce.com, ACT, Access, Goldmine, and many others. I generally recommend that you work with an “off the shelf” software program as they are less expensive and more people know how to fix them. If you do have a franchise sales software program are you utilizing its full capacity? Run some diagnostics on your current sales process to ensure maximum utilization. It makes the sales process much easier and helps your franchise sales people sell more franchises!
7. Discovery Days – Are you conducting discovery days? Are you presenting the best of your business to your prospective franchisees? Are you ensuring that on discovery days that you are bringing them to your business when it is busy and open? Are you ensuring your prospects a quality experience? Remember, buying a franchise is an emotional purchase. Meaning that your franchisees will “fall in love” with you, your company, the business, or whatever. We want the prospective franchise buyers to have a great experience and come away with a “good feeling.” This is too often overlooked in the process. Re-evaluate what you are doing for your discovery days. If you are not having any discovery days, make sure that you add them in.
8. Proper Disclosure and the 14-day Cooling Off – Remember to properly disclose your franchisees. Get the signatures, the sign-offs, and everything else that needs to be taken care of when presenting the Uniform Franchise Disclosure Document to your prospective franchisees. Always make sure to have your UFDD in its most current form and be compliant with your state and federal regulations. Remember to be compliant with the 14 day cooling off period where you cannot accept a deposit, sign a contract, or do anything that could indicate a sale after the initial disclosure document is presented. This is an important aspect of the franchise sales process as your prospects will consult with their lawyers, CPA’s, bankers, friends, family, etc. This is also your opportunity to make sure that this is a prospective buyer that you are interested in bringing into your franchise system.
9. Follow-up – After the qualification, phone calls, and discovery day the hardest part is next. You have to remember to follow-up with your prospects. The follow-up is often times where you are able to hear the truth about what your prospects are thinking. You need to examine how often and what you are saying in your franchise sales follow-up. It is key to institute a quality follow-up procedure to assist your franchise sales long-term.
10. Going for the Close – If you don’t ask you will not receive. Make sure you always ask for the sale. This is critical! Nothing else in the sales process matters if you don’t ask if they are ready to move forward with signing the paper work and cutting a check. If this is your first sale or you are new to the process, do not act squeamish about asking for the sale. Repeat to yourself: “I will ask for the sale, I will ask for the sale, I WILL ASK FOR THE SALE!!”
As we have discussed the franchise sales process is full of detail, hard work, and persistence. It is a rewarding and exhilarating experience that is full of high emotion for both you and your prospective franchisees. Remember that the key to franchise sales is being able to say “No” to someone that doesn’t fit in with your organization. If someone is a problem early in the sales process, they probably will be a problem as a franchisee. Learning to say “No” and granting or awarding franchises to the right people will help you out significantly as you continue to grow your franchise company. I would also suggest that it is often difficult to do your own brain surgery when reviewing your sales process and you may want to seek outside consultation. Remember, the key to franchise sales is selection, selection, selection as these people will be “married” to you for the next 20 years; so choose wisely.