Advisory Mar, 17 2010

Laying the foundation for franchise success

If you have recently taken-up a franchise, then you need to understand the importance of laying a strong foundation during the first year of your business establishment. Read on to know its importance

By Ramanjit Kaur
Feature Writer
Laying the foundation for franchise success

With the growing number of women in franchising, the fairer sex sees to enjoy her share of success equally well with that of men. Some of the successful entrepreneur like Shahnaz Husain (Shahnaz Husian Group), Lina Ashar (KKEL), Shobha Kaul (Personal Point) etc have made the Indian male franchisors realise that women have a significant role to play in the franchising arena. While few years back, it was unusual to see a woman heading any business empire. However, the present scenario is witnessing the emergence of women in franchising. Lina Ashar, Chairperson and Founder, Kangaroo Kids Education Limited (KKEL) remarked, “Previously there were restrictions to venture into business and entrepreneurial activities. But over the years with increased education and exposure, the woman of today is more confident and outgoing as compared to the previous generations.”

Shahnaz Husain, Founder, Shahnaz  Husain Group shares, “The last two decades have seen the woman stepping out of her home, to make a career, gain financial independence, establish her own identity and fulfill her ambitions and dreams.” She further adds, “One can even go so far as to say that business acumen and sound management are without gender. There is no hard and fast rule that a man is a better entrepreneur by virtue of being male. Women have shown that given the same opportunities, they can be equally successful.”

Nevertheless there are few franchise businesses which are ideal for women. A few of these are listed below:

  • Pre-schools and play schools
  • Educational institutes
  • Beauty and hair salons
  • Jewellery franchise
  • Apparels and lingerie
  • Home furnishing and interior designing
  • Home-based franchises
  • Health and wellness centres

Innate qualities responsible for competing with men

Women because of their innate qualities are suitable for most of the franchise venture. Ashar shares, “In my opinion, success is not gender-specific. For both women and men to attain success the common mantra is focus, dedication, determination, innovation and inspirational leadership skills. However, due the patriarchal system of society, women need certain additional emphatic qualities like firm decision-making skills, pragmatic outlook towards enterprise-management and larger risk-taking appetite in order to sustain and succeed their ambitions. We can see women are breaking through these barriers. With the right exposure and qualification, women entrepreneurs of today are matching their male counterparts at every step, or in fact a step ahead.” In words of Husain, “Women not only have the courage, inner strength, and foresight that are necessary to be successful as entrepreneurs, but are no less than men when it comes to intelligence, talent, and creativity.”

Let us have a look at some of the qualities that make women better competitor than men in the franchise business industry.

Once you have started the franchise business, you tend to put extra efforts during the initial period of the business establishment. The first year of every franchise business is crucial not just in terms of its survival but also for its sustainable growth in future. This period is crucial for both the business and the entrepreneur as because:

  • A franchisee has to set-up his/ her business in such a manner so that s/ he can head in the direction of getting success.
  • S/ he must make use of his/ her business acumen in building the market and loyalty of the customers, which are the key drivers of any business.
  • S/he has to build a good relationship with the franchisor and the industry people for long run reimbursement.
  • S/ he needs to recruit the employees for the business and develop a relationship with them in order to ensure the proper running of the business.

Common problems a franchisee can face during first year

New franchisees are likely to face disappointments during the first year of business operations, like:

  • Over expectation during the initial period of the franchise business is a common problem. This is because building a new franchise and customer base for the business takes time.
  • Secondly, over expenditure during the initial phase of the business is another problem faced by the entrepreneurs. This is because the aspirant outdoes the amount of investment required during the business set up.

A franchisee needs to have patience and be realistic in his/ her approach, as success never comes overnight.

Tips to ensure survival and success of a new business

In order to avoid these problems and ensure the success of the franchise business, here is enlisted few essential points that a franchisee needs to follow:  

  • Create a clientele base: You as a franchisee need to put in lots of effort to build a good clientele base to ensure the smooth functioning of the business.
  • Sound franchise relationship: Being a franchisee, you need to develop the art of building and keeping a good relationship with your franchisor. It is utmost important as you need the franchisor and his/ her company to help you in establishing the franchise business.
  • Build a work strategy: During the first year of your business build a work strategy to create an atmosphere full of action and enthusiasm. Being a new comer in the business, you need to impress your clients with your dynamism and passion. In order to gain the competitive edge from your employees, you need to encourage, and motivate them and if necessary reward them for their achievements.
  • Customise an action plan: Being a franchisee, you will enjoy a number of leverages from the franchisor’s part in terms of guidance and support. In spite of this, you are recommended to customise a plan of action for daily actions and then accordingly try to fulfill those commitments to maintain the benchmark standard of the franchise business.
  • Propagate the business opening: Especially during the first year, a franchisee must be a spokesperson for his/ her business. S/he is always suggested to consider every other person as a sales opportunity and try to talk as much about your business as you can. It is the best way to market a new business.
  • Business funding: An entrepreneur is always advised to fund the business on his/ her own rather than borrowing money from somewhere else. However, if s/he does not have enough capital to invest in the franchise business, then bank loan is always a best alternative. However, a franchisee needs to negotiate the long repayment term for the loan thereby keeping the monthly outgoings to minimum.
  • Develop new relationships: During the first year of franchise operation, it is extremely important for the franchisee to develop new relations by meeting new people in the industry. You need to make connections and build a network, which will help you in running the franchise business effectively and efficiently.
  • Maintain a balance lifestyle: Though the first year of any franchise business demands lots of attention and hard work, but it does not mean that one becomes a workaholic. A balance is necessary to maintain in order to enjoy the work. Therefore, a franchisee should take short breaks from time-to-time to revitalise the senses and to regain the energy, which is required to keep the franchise business thriving.  

These are the few tips that will assist you get through the first crucial year of the business operations and further help you sail through successfully. To conclude, one can say that it is only through sheer hard work, patience and perseverance a franchisee is able to taste success.

Empathetic and friendly:  Women are more empathetic and friendly as compared to men. Women can create better relationship with their employees and clients. The tendency to be more empathetic and loving makes them perfect in running pre-schools and play schools. Moreover, women are warmer, friendlier and can sympathise with staff, thereby winning their regards and friendship sooner than most men franchises.

Juggling and organising ability: Women can handle more tasks simultaneously as compared to men who get flustered when faced with challenges. Husain comments, “A woman has what it takes to be a successful entrepreneur. For one thing, she can manage her different roles of wife, housewife, mother and career woman efficiently.” Therefore, women have the tendency of doing more than three things at the same time; this helps them in making a franchise successful. Ashar says, “While most women are known to proficiently manage multiple activities, it can get exhausting and be unproductive in the long run, if tasks are not organised well. Being able to focus on every task in hand is a major advantage that a women yields.”

Patience and time management: Handling the multiple responsibilities makes women more patients with employees. Women can divide their responsibilities and try to complete them in the allotted time. Ashar comments, “Good time management and organisation skills go a long way in ensuring the effective usage of one’s time and skills and the outcome at large.”

Prioritising responsibility: Women are good at prioritising, and deciding which activities are more important than others. This particular skill works well in the franchising industry, when problems arise concerning planning, staffing, financing and people management.

Better at motivating and encouraging: Women are considered better at motivating and encouraging employees. This helps them in getting more work from their employees and also encouraging franchisees that are not doing well. This accounts to the reason of seeing more women counselors in schools and corporate sector also.

The above given qualities prove that women can successfully compete with men in the franchise arena. Therefore, now it is time for men to understand and encourage greater acceptance of women as franchisors and franchisees.

To conclude, women are ushering as a strong competitor of men in the franchising industry and India is soon going to witness more number of women entrepreneurs in the near future.

Related: Strategic means of expansion

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