Brand Sentiment Study Shows Your Best Customers May Become Your Best Franchisees

The pathway to franchise ownership apparently runs through the checkout line. A Curious Jane attitudinal study about brand sentiment and other factors influencing franchise candidates shows that nearly half of current franchisees were already customers and fans of their brand before they purchased their location.

Curious Jane conducted a proprietary attitudinal segmentation study to learn more about the motivations of franchise owners. We surveyed more than 500 franchisees to better clarify the beliefs, perspectives, preferences, pain points and aspirations of franchise owners. The survey results have a 95% confidence level, a high level of confidence.

According to the study, 45% of the franchise owners surveyed said they were customers of their franchise brand before they became franchise owners, and 37% said they first heard of the brand because they were customers.

Franchise development marketers need to target their brand’s superfans.

Wanted: Passion for the Brand

Have you thought about the qualities that make your franchisees successful? In the study, more than 80% of franchise owners named people management skills, a strong work ethic and communication skills as the qualities necessary for success.

But not far behind was passion: 61% said having a passion for the franchise brand was necessary to be successful. In other words, your casual customers won’t be your best franchisees. Superfans make super franchise owners.

And since they already know the brand and your product or service so well, the messaging for superfans should be a little different: For instance, you may need to introduce them to the franchise opportunity. You may be surprised at how many of your customers are unaware that your brand is a franchise.

How do you do that? In addition to making sure your consumer website has an obvious link to the franchise site, you may want to occasionally post on your consumer social media channels, or carve out space in an email newsletter, about where followers can learn more about franchising. Capitalize on the first-party data you gather through apps and more to target your superfans.

Prioritize Customer Experience

Customer experience matters to your customers, and it also matters to your owners. In the study, 22% said prior experience with the brand as a customer was an important factor when considering a franchise purchase. That’s even higher than they rated having prior experience in the same industry, which 15% cited.

Additionally, 42% of respondents said a poor customer experience would discourage them from buying a franchise.

If you want to sell more franchises, you’ll need to provide exceptional customer service. Great customer service is what elevates a fan to a superfan, and it’s what keeps the superfans coming back for more.

According to the respondents in this study, it could also be, in part, what attracts superfans to your franchise opportunity.

Takeaway:

Think about your superfans when you are creating fran dev marketing materials. A positive tone and brand consistency will matter to the prospects who already love your brand. In addition to discussing your exceptional training program and support systems, you may also want to incorporate information about customer satisfaction and how important it is to your brand that you deliver a great customer experience every time. You might also want to include testimonials from former customers who now are franchisees.

This customer experience messaging will resonate with the superfans among your candidates.

Identifying and understanding your target audience is a critical step in your franchise development marketing strategy. Knowing who your audience is helps you tailor your messaging and strategies to effectively reach and engage potential franchisees.

When it comes to marketing your franchise, do you really know your target audience? Is it a single person? What about a team or a family? Will they be a silent partner, or do they plan to play an active role in the day-to-day operations to grow the business?

Setting up your marketing campaign correctly can help you target your intended demographic, assuming you’re confident in your process.

Curious Jane partnered with a research firm to conduct a scientific study on the attitudes, goals and challenges that shape franchise candidates’ decisions to invest in a franchise business (and which one). We surveyed more than 500 franchisees to better clarify the beliefs, perspectives, preferences, pain points and aspirations of franchise owners. The survey results have a 95% confidence level, a high level of confidence.

Our survey’s respondents were candid about what influenced them through the franchise purchase process. When it comes to buyers of franchising brands, our study showed you’re often not marketing to one person alone.

By the Numbers

The research shows that franchise business owners had help through the purchasing process and often sought the input of others, including their parents, spouses, mentors, former employers, friends and tax/legal professionals.

Some key findings:

  • 82% of respondents said their spouse or partner was involved in the decision to purchase a franchise.
  • The second and third groups involved in the decision-making process mentioned among respondents were parents (32%) and friends (17%). 
  • 45% of owners said their spouse or partner financed the business.
  • 39% said they are partners in the franchise business and another 36% said they work for the business.
  • Respondents under 35 years old said they were more likely than other age groups to have involved their parents, a mentor or boss in the decision-making process for investing in a franchise brand. 80% of those younger than 35 involved their parents.

Measured Targeting

So, who is in the ear of your potential franchisee and what are you doing to educate them?

Depending on your targeted demographic, you could be talking to various audiences among multiple age groups. As you gather information about the potential franchisees in your industry, this will be key to understanding the various demographics, preferences, behaviors and needs to close the sale.

Creating detailed buyer personas that represent your ideal franchisee candidates is part of the process you can use to target these various audiences. These personas are based on fictional characters that embody the traits and characteristics of your target franchisee.

They help you understand your audience’s motivations, pain points, goals and challenges.

If you want to target a younger franchisee demographic, you’ll be talking to their parents, too. Each of these personas has different habits when consuming information and researching companies like yours. In this case, not only are they involved in making the decision to buy, but 46% of those under 40 years old relied on their parents financing the purchase.

Those in older demographics, 40 to 59 years old, often relied on their spouse or partner for financing. Those 60 and older were more likely to have financial assistance from either their spouse or a business partner.

Keeping this in mind the next time you’re vetting a franchise candidate can give you an upper hand in the deal. Knowing the habits of your intended franchisee and the type of partner influencing them can give you better leverage in educating your audience with relevant information needed to close the deal.

A successful franchise development strategy is one that will help attract new franchisees to your company, not scare them away. But a key component in getting them to invest is knowing why people hesitate to buy a franchise in the first place.

So, how do you walk that fine line in attracting the right franchise owners?

Last year, Curious Jane conducted a proprietary attitudinal segmentation study to learn more about the motivations of franchise owners. We surveyed more than 500 franchisees to better clarify the beliefs, perspectives, preferences, pain points and aspirations of franchise owners. The survey results have a 95% confidence level, a high level of confidence.

Our survey’s respondents were candid about what was going on in their minds, researching franchise companies they were interested in, and in this case, what turned them off.

Bang for the Buck

If you want franchisees to invest in you, you must be willing to invest in them.

In our survey, 73% of those responding said a franchisor’s high costs and fees caused them to hesitate to buy into a brand. So, what can a franchise company do to be a more attractive investment?

Sure, a franchisor must make money, and it’s understood there are going to be royalty fees and other costs associated with buying into a franchise. It’s part of the business. But what’s the value your potential franchisees are purchasing?

High franchise fees may be justified. Just make sure that if you are going to charge a high fee, you’re worth it and are delivering on what you promise.

Franchise companies need to make it clear to their prospective buyers what exactly they are getting and show its value. Reasonable franchise fees are to be expected, but a quick check of your competition’s fees can help you make sure you’re in line with your specialty. This isn’t the time to get greedy.

Also, consider how your franchise fee and royalty fees are used to provide benefits to your potential buyers. Do you offer training? How about ongoing support, website access or marketing assistance? These are all benefits that can convey your company’s worth to potential buyers.

Getting into the franchise business requires a significant personal investment. Often, this means franchisees aren’t able to enter the business until a later stage in their life. What can a company do to attract younger entrepreneurs to ensure the future of their franchise brands?

One way to make your franchise more attractive to entrepreneurs who need more cash is to provide greater financing options through lending partners.

Disgruntled Franchisee Representation

While you can’t make everyone happy, if you’re looking for a franchisee representative to talk to candidates about buying into your brand, we suggest finding one who is happy and embodies what you seek in the ideal franchisee.

Franchisees who have had a bad experience ranked second in our survey, at 64%, for reasons why someone would hesitate in buying into a franchise. In the validation process, you can bet that your franchisees will be candid about their experiences with your brand. This is an easy way to make sure it’s a positive process.

Additionally, setting clear expectations up front can help you down the road. As potential franchisees work their way through the process, make sure you pair them with one in your system who is relevant. Don’t pair a franchisee in a major metro area with one who seeks to open a rural location. Also, if you hold franchisees who have been in your system for a long time to different standards, make sure that is communicated up front or pair them with someone else.

Knowing what is expected of them as a franchisee should be communicated before moving into the more advanced stages of the investment process.

Turn a Frown Upside Down

The business world is rarely all sunshine and roses. Disagreements happen. Messages are miscommunicated. Mistakes are made. Life happens.

How a company positions itself in negative situations can have measurable impacts when it comes to franchise sales. Having a negative public reputation can have a significant impact on your franchise sales, according to 63% of those who responded to Curious Jane’s research.

So, what can you do about it? Managing your brand’s public image should be a priority. If it isn’t, get on it.

A good public relations strategy is essential. Social media, blogs and an effective SEO strategy allow you to tell your brand story. Earned media coverage stemming from press releases and pitches about accomplishments, features and events also helps portray your company in a positive light.

Incorporate third-party validation when possible. Be sure to leverage national rankings and lists, like Entrepreneur’s Franchise 500 or Franchise Business Review’s Best Franchises for Women. Placing the badges on your website and using them in ads, social posts and anywhere else that is relevant carries great weight with potential candidates seeking to invest. This third-party validation shows outside companies agree you are as wonderful as you say you are.

A Curious Jane attitudinal study shows work-life balance is one of the top considerations why people choose franchising.  

As a marketing agency that handles franchise development for many clients, we had ideas about what potential franchisees considered when deciding to open a small business, but we didn’t want to assume we were right. So, we partnered with a research firm to conduct a scientific study on the attitudes, goals and challenges that shape franchise candidates’ decisions to invest in a franchise business (and which one).  

More than 500 franchisees from a half-dozen franchises participated, giving the study a 95% confidence level.  

Over the next few months, we’ll share some of our findings in this blog, on our social media platforms and elsewhere. We’ll touch on topics ranging from how long it took potential franchisees to decide to buy a franchise, how their experiences as customers played into candidates’ decisions to buy and what millennials expect from franchisors.  

Today, we’ll explore why work-life balance is a huge factor in choosing to buy a franchise.  

Work-Life Balance Is Key 

The research shows that franchise business owners are largely happy with their work and their franchisors. Their biggest concerns center around work-life balance, time constraints and hiring.  

Some key findings:  

  • 56% of respondents said their biggest concern before owning a franchise was work-life balance. The second and third biggest concerns were ongoing royalty fees (48%) and hiring and retaining employees (38%).  
  • 73% said they left their last job to open a franchise so they would have more control over their career path, 49% were seeking financial independence and 47% wanted to earn more income. 
  • 51% rated their experience with their franchisor as excellent or very good. 
  • When asked the Top 5 most valuable benefits of owning a franchise, 45% cited autonomy, 37% said franchisor support, 36% said a lower risk to starting a business, 36% said self-fulfillment, and 32% said community influence/having an impact where they live. 
  • 50% said they would hesitate to open another location because of the time requirements, and 48% would hesitate because they wanted to spend more time with their family.  

Franchising is attractive because it offers work-life balance and control over a person’s work life and financial future. The franchisees who participated in the study opened a franchise business partly because they wanted to make more money. Although they understand that additional locations could yield a higher income, they would rather spend more time with their family than put time into launching another business. 

Impact on Franchise Development 

How can franchise development teams use this insight to allay candidates’ concerns?  

Just as you would communicate what your corporate team is doing to support recruitment efforts to candidates worried about staffing, you need to explain how your franchise’s business model offers a flexible schedule to candidates worried about work-life balance. 

Additionally, when you encourage candidates to talk to other franchisees as part of the validation process, make sure they speak with franchisees who run a successful business and feel like they are achieving balance, preferably in a similar family circumstance. For example, encourage parents of young children to talk with other parents of young children, and encourage single parents to talk with other single parents.  

Semantics matter, too. Instead of repeating your franchise brand offers a “proven business model,” you might add that it offers a “business model that supports work-life balance.” 

Finally, if you have a rock star franchise business owner who would make a great multi-unit owner if they could just get past the fear that more locations will upset their work-life balance, address that head-on by explaining how your business model is built to scale. Although it’s reasonable to expect the launching of additional locations to take more of an owner’s time and focus in the short term, a second location should not double a franchisee’s time commitment if the business is truly scalable.  

If franchisors can demonstrate how franchisees can add locations – and grow their businesses and incomes – without giving up too much family or personal time, franchisees may be more eager to expand.  

Inflation cooled, prices stabilized, supply chains rebounded and jobs reports remained strong in 2023. But that doesn’t mean the year didn’t have its share of economic curve balls to get to where we are now – looking out on 2024 with renewed energy for what is to come in franchise development trends.

The year that was 2023 bucked the down economic predictions that were expected in the franchising world. Hand wringing over a looming recession soon faded last year as a hot world economy drove prices higher with surging inflation. The Federal Reserve Bank took notice and made the decision to increase interest rates. But as the year ended, a clearer economic picture was taking shape – one that gets us excited for the year to come.

“This last year has been a challenging but exciting year for franchising,” says Curious Jane CEO Lora Kellogg. “While many of us in the industry know that down economies can be beneficial in franchising, it takes a strong franchise development marketing plan to pull that off. And 2024 won’t be any different for any of our clients.”

While any predictions to be made about 2024 are about as reliable as shaking a Magic 8 Ball, there are a few trends to look for in the franchising world entering the new year. Watching and positioning yourself effectively to take advantage of these continuing trends will be key for a brand’s franchise development program growth, Kellogg adds.

Less Dependence on Brokers

During the pandemic, when interest rates were low, it was an easy decision to use brokers. They didn’t have to do much selling and leads were abundant. But in the current economy, where inflation has driven prices higher and limited profit margins, the tables have turned. In the current economy, selling is tough.

Franchise Update Media surveyed 120 brands for its 2024 Annual Franchise Development Report. In the report, 44% of survey respondents said they rely on brokers for franchise recruitment or lead generation. In the same survey, companies reported brokers accounted for about 29% of the franchise recruitment budget (digital advertising was first at 45%). However, when it came to generating leads, brokers accounted for only about 13%. The vast majority came from digital advertising.

Some franchisors are realizing the high fees charged by brokers aren’t worth what they are paying, Kellogg says.

With one client, whose franchise fee is $60,000, they pay a 50% fee to the brokers they use. But when they weren’t selling enough, the franchisor increased the fee they paid by another $10,000 as an enhancement. So now $40,000 out of the $60,000 fee is going to brokers, and the company was only spending $200,000 on their own for marketing.

“The problem with using brokers is it’s really expensive over time,” Kellogg says. “Relying on brokers versus building your own program is dangerous long term. When brokers do the heavy lifting, you don’t really build a great internal marketing program.”

To change, Kellogg adds, brands need to invest in themselves – in PR, digital marketing, a great CRM – rather than placing such an emphasis on broker sales.

Increasing Digital Budgets

A strong digital marketing strategy will be key moving forward in 2024.

“You need strong digital marketing presence,” Kellogg says. “You need strong creative. You need strong analytics to tell you what’s working and what’s not.”

In the Franchise Update Media survey, respondents reported that digital advertising accounted for 60% of their leads, but only 45% of their franchise development budget. Digital advertising is also the No. 1 source for closed deals.

“In general, digital budgets remain consistent with a continued focus on lead generation through digital channels,” the report says. “Employing diverse media channels for franchisee recruitment remains a successful strategy. Brands that adapt by directing funds to the most effective channels have higher chances of achieving their goals.”

Rising Costs and the Importance of First-Party Data

As many businesses have already learned, the cost of doing business has gone up in the last year, thanks to inflation. And any immediate relief to that remains to be seen.

Costs of goods are up. Shipping is up. Real estate is more expensive and harder to find. Labor is expensive and difficult to find in a robust job market. Advertising costs have increased. Franchise fees are also on the rise.

So, what does that mean for franchise development? The pinch of the digital wallet is going to be felt even more by both you and your customers. This uptick in costs affects everything.

It also means a pivot in your targeted audience for sales growth if you want to meet your goals. In the coming year, expect to see a shift toward franchisors courting investor personas for their brands.

Without data and a good CRM, sourcing for leads is more difficult. The more robust your CRM is, the more data you will be able to collect. Now that cookies are a thing of the past, the more first-party data you have on your audience, the more cost-efficient your campaign. And to make yourself heard above the digital noise, you’ll need to have an optimized omnichannel approach. You can’t limit your brand’s presence to one or two platforms.

With all the competition within those channels, the need to be disruptive is important.

Increased Use of AI

Robert Mitchell, chief AI officer at WSI, which describes itself as the largest digital marketing network of its kind with clients in about 50 countries worldwide, sees the use of AI becoming more prevalent in the use of franchise development in the coming year – especially when it comes to developing more content at a faster rate.

And if franchises don’t get on board and get comfortable with the use of AI, they will be left behind.

“This technology is moving so fast that you can’t sleep on it,” he says. “So, you just gotta be ahead of the curve with your capacity to understand that technology and implement it for that client.”

Part of that trend is for franchisors to learn how to leverage the use of content creation in a smarter and more reliable way that will be scalable. As AI becomes more reliable and the technology improves, the amount of content you will be able to produce will grow exponentially.

But, Mitchell cautions, this doesn’t necessarily mean you should replace people with new technology to save money. In fact, he insists the human element needs to remain and that roles need to adapt to it. It’s (unintentionally) part of the company’s tagline – “Embrace digital, stay human.”

“That stay human piece is another way of saying it is the human in the loop, which is a very common phrase that is thrown around in the marketing spheres of people who are using AI,” he says. “What should be obvious in that is that you never go straight to market with an AI product, right?”

If it’s wrong, it will cascade into a false content production. Once it is released to the web and indexed by Google, it all gets attributed to you.

“That need to be at the forefront of that (AI) conversation,” he says. “You need to make sure the human is in the loop, otherwise you’re going to look stupid, and you can’t go backward.”

Are your lead numbers down? Franchise sales are taking longer in 2023, but that doesn’t mean you can’t reach your goals. It just means you may have to approach them differently. So, how long does it take to sell a franchise right now?  

Where 2022 delivered a historic franchise growth average rate of 2% – beating pre-pandemic numbers – 2023 is predicted to grow at a slightly lower rate of 1.9%, according to the International Franchise Association’s 2023 Economic Outlook for Franchising.  

A growth rate of 1.9% is a healthy number. And industries like personal services and quick service restaurants (QSRs) are anticipating an amazing 2.5% growth rate.  

The bottom line is you can not only grow your franchise brand this year, but you can meet your sales goals. The secret is to focus on bringing in top-quality leads. These are the people who are most likely to sign on the bottom line, rather than “tire kickers.”  

When the economy is good, franchises have plenty of targets to choose from. Leads are easy to come by and franchise sales teams rest a little easier knowing that with so many leads, they are bound to close enough franchise sales to hit their numbers.  

Currently, however, the economic situation is a bit tricky. Interest rates and inflation are up, and leads are down, so the franchise sales cycle is longer.  

To combat this situation, here are two simple tactics: Focus on creative, and aim at the middle of the funnel.  

Focus on Creative  

One way to attract higher-quality leads is to up your game with creative. Because some franchisee prospects may be hesitant to buy a franchise right now, your advertising creative should highlight attributes that build trust and credibility. 

To demonstrate that your brand is solid and stable, emphasize the longevity of the company and how many units you have. To show that your franchise is a sound investment, you might call out affordability and financial incentives that you offer new franchisees.  

You also should showcase any rankings or prestigious lists that your franchise is on, such as Entrepreneur’s prestigious Franchise 500, Top Low-Cost Franchises or Best Franchises for Veterans. Accolades from an outside organization, like a media outlet, provide third-party validation that your franchise is as awesome as you say it is.  

At Curious Jane, we include badges from those lists on creative as often as possible. In many cases, ads featuring badges are extremely high performers. Rankings and other accolades carry a lot of weight with franchise prospects.  

Aim for Mid-Funnel 

With targeting, focus fran dev campaigns more on the middle of the funnel, or consideration efforts. This strategy nurtures users who are already in your sales funnel but may not be ready to buy. Consideration efforts teach users more about brands and franchise opportunities to help move them to the bottom of the funnel, where they will be ready to buy.  

In the consideration phase, users are likely to engage with educational content, or information about a brand’s values, support programs for franchisees and more. At mid-funnel, the goal is to drive users to the company’s website so they can research the brand and the franchise opportunity. A good choice for a mid-funnel campaign might be a social media traffic campaign.  

Curious Jane clients are finding success with mid-funnel ads on Meta (primarily Facebook and Instagram), which are served to users passively, as well as Google search ads, which are served after a user searches for the brand. 

Because the economy is unsettled, this is not the year to fixate on lead volume. If you broaden targeting enough to meet (or beat) last year’s year-over-year lead numbers, you may inadvertently fill up your lead funnel with tire kickers.  

However, if you stay focused on getting higher-quality leads with the knowledge that you’ll have to nurture them a bit more, you can attract more serious prospects and achieve your sales goals. 

Chances are, your next potential franchise owner is sitting inside one of your locations right now. They may be, for the first time, researching your fran dev website on their phone.

Maybe they are waiting on their food, in the middle of a pumpkin spice latte, or doing their hair. In any instance, they are not looking at a computer. They’re on their phone.

Now think: What does your website look like on your phone? Did you have your site designed with a mobile-first mentality? You need to be prepare your franchise site for mobile users. If you aren’t, your sales funnel will suffer.

Data Supporting Mobile-First Web Design

This conversation isn’t new in the marketing world. Our clients’ Google Analytics show us more than 60% of fran dev web traffic comes from mobile devices on average. Just to be clear, this number doesn’t include tablets – only phones. In addition, users use mobile devices for about 70% of all actions on the site, like surveys or filling out forms.

When Google rolled out its page experience update in 2021, a main point on the list was mobile friendliness. Ignoring this moving forward can impact where potential clients view you in search results.

“Page experience is a set of signals that measure how users perceive the experience of interacting with a web page beyond its pure information value, both on mobile and desktop devices,” according to the Google report.

How Mobile-First Web Design Changed Search Algorithms

As users search, Google now optimizes that search to the type of device they use. They provide results tailored to the device. If a majority of your potential business is coming through mobile devices, and your website lacks a mobile-friendly design, your site will rank lower than your competition’s.

So, if your website is outdated or isn’t mobile friendly, now is the time to begin planning a redesign. This process will take time. A custom-built website takes about a year to write, design and develop.

At the end of the day, you want your user to quickly find what they need on your site and provide you with their contact information in exchange for something valuable to them. They shouldn’t have to click through multiple pages or scroll through tons of content to get to the call-to-action.

In the case of consumer sites, the call-to-action is usually straightforward in the form of an online purchase or scheduling an appointment for a service quote. In the realm of fran dev, you want the user to feel comfortable giving their contact information. They should be able to do complete it without feeling like it obligates them to buy a franchise immediately.

Exchanging Value

To help with this, consider downloadable lead magnets that provide users with more information about the franchise. This works as a best practice approach. Users don’t expect to fill out a form and then get a phone call right away. At this point, a call from a sales rep asking them to buy an expensive franchise would not be ideal. Instead, you want to capture their contact information and put them into a less-intrusive lead-nurturing strategy. This strategy may include emails, webinar invites and surveys that provide more insight into your potential franchisee.

Expanding your franchise’s footprint and making it a more attractive investment to potential franchisees is accompanied by a well-choreographed process that feeds your sales funnel and, hopefully, ends with the opening of a new location. Think of it as a high-stakes corporate dating profile. Before you get to the proposal, you need dad’s permission for the first date. That means thinking about potential lenders reviewing what a franchisor has to offer candidates. Let’s dive into the reasons for educating them on how to navigate the lending process and how to effectively communicate the details of Item 19.

Why it matters now more than ever

If you don’t meet their standards, they’re going to swipe left in a hurry. In the current hot market of franchise sales, you don’t want to leave that to chance.

“Starting franchises right now after COVID has actually been one of the hottest times in franchising, really, because people got really frustrated with their employers and jobs and being reliant on other people for their income,” says Chad Carter at Lendio, a franchise company that specializes in small business financing. “A lot of people said, ‘Screw this, I’m going to go open my own business,’ but they don’t really know how to open their own business, so they buy a franchise.”

Teach them about your company’s Item 19

How do you keep an up-to-date profile to ensure a potential suitor keeps coming around? Filling out your company’s Item 19 on your Franchise Disclosure Document (FDD) and keeping it current is a start, says Carter. In Item 19, a franchisor may provide information about the historical or projected financial performance of the franchisor, franchisees and company-owned units. 

“That absolutely is helpful to lenders,” he says. “Depending on the franchisor, the Item 19 can be written better or worse.”

In Carter’s experience, about 30 percent of companies leave this portion blank and even more don’t bother to update it regularly. Item 19 is the only optional section in the FDD, but it’s a crucial piece of information that can help lenders determine whether your franchise is a viable investment for candidates – and for lenders who will help them start their business.

Tell your company’s story

Item 19 helps tell your company’s story, and with the last few tumultuous years, companies have a lot to tell. How did your franchise weather the pandemic? Did shutdowns hurt profitability or stunt expansion? How about issues with supply chains or difficulty in finding staff? Many small businesses, especially, have had to deal with these challenges, and Item 19 can help explain financial fluctuations and make your franchise a more attractive option to franchise candidates and lenders.

“They could say, for the last seven years we’ve had X percent of growth, but during COVID we had this percent of growth because our stores were shut down,” he says. “It makes sense because so many franchises are food-related. They absolutely would have been affected by COVID shutdowns. That’s definitely information people are plugging back into their Item 19s, especially with the Paycheck Protection Program money businesses received. You’d want to put that in your Item 19. This shows that all these businesses got injected with cash from the government. If you don’t, that could be seen as deceitful.”

There are other ways for franchisors to help prospective buyers navigate the lending process.

Get listed in Small Business Administration’s directory

For emerging franchises, getting on the Small Business Administration (SBA)’s directory and registry is key. Many franchise candidates seek government-backed loans from the SBA. They are the most common and specifically serve first-time franchisee borrowers. But they need to meet requirements to secure financing.

Franchises must list themselves in the SBA directory for a candidate to get a loan from the SBA. This is true for franchises that are both established or emerging. The SBA’s registry indicates whether certain brands should obtain financing.

“In franchising, it’s kind of nice because a company can get listed with the SBA as an approved franchise, and if it’s approved, you will be eligible to get an SBA loan to start a franchise,” Carter says. “However, I’ve never seen a lender allow someone to get an SBA loan to purchase a franchise that isn’t listed.”

Partnering with lenders

Another way to help your prospective franchisees navigate the lending process is to partner with preferred lenders. In many cases, partnering expedites the lending process and allows candidates to get approval for financing more quickly.

The benefits of having preferred lenders are that they are already familiar with your company. This often includes its financial performance and any challenges it may face.

“If a lender is comfortable with your business model, they are going to do less necessary fact-gathering and documentation,” Carter says. “They will have most of that down and will only have to patch the holes that are unique to you instead of answering general business questions. It definitely makes things easier.”

Include information for existing franchisees’ lending needs

Not everything related to lending focuses on first-time borrowers. Existing franchisees need lending services, too. And there are other ways franchisors can help, Carter says. Part of that revolves around financial document accounting practices.

“It would be in their best interest to have accounting rules laid out for franchisees so that their books look really clean and to create a system where they are organized from a financial statements perspective,” he says. “Having records in place and having a good system for making sure your finances and taxes are in order will make it a lot easier to get financing.”

Every lender wants to see tax returns and financial statements on hand, he adds. “Having that stuff around and at the ready is paramount.”

Taking a layered approach to a franchise’s marketing and advertising campaigns ultimately benefits both the franchisor and franchisee, without one getting in the way of the other. 

The Opportunity

While local franchises serve their surrounding communities, the national brand always has a larger presence to appeal to the masses across the country or region. These two perspectives, however, serve the same goal – to educate new customers and investors about the brand and attract them to the brand. That same mentality needs to be applied to marketing and advertising campaigns launched by franchise brands.  

Without a doubt, the integrity of the brand is vital to any campaign. Oversight of this helps the franchisor maintain the look and reputation of the brand. On the flip side, local franchisees can take advantage of national advertising campaigns and localize them to generate new business. 

So, where do you start? 

Promote Effective Communication

Clear and continued communication is a great first step. If franchisors focus on brand awareness, franchisees can target lead generation through targeted, local marketing.  

Franchisees should look for ways to take advantage of national campaigns and how to build on them in their local markets. This keeps the owners engaged in what is going on within their community. Franchisees also benefit from the spending power of the larger corporate structure. The national brand can more easily capitalize on large media buys to target specific areas. 

Campaigns to show on the Super Bowl, a national TikTok campaign or satellite radio are best left to the buying power of the franchisor. The larger brand is great for providing brand recognition, but it should also provide guidelines for local marketing strategies and create a network where franchisees can communicate to share experiences. 

Choose Strategic Partners

Preferred vendors can help navigate advertising opportunities between the national campaigns and local marketing. These vendors essentially work as a corporate marketing arm to ensure brand standards are maintained through images, logos and copy while helping the franchisees advertise within their communities on a local level.  

Use Your Franchisee Advantage

Where franchisees can shine is in knowing their local clients and taking advantage of local advertising campaigns to drive traffic to the hometown location. 

Build a Powerful Community

Think digital. Taking advantage of available social media pages is a great way to create a local community around your location, and it’s easy to do. It’s the perfect place to engage in your online community and directly appeal to your customer base using community groups, promoting upcoming sales and events and engaging with other local businesses. Social media also can connect local franchisees with influencers in their area who can help promote the individual location. 

Diversify Your Efforts

But franchise owners should not put all their advertising eggs in one basket. Local radio, newspaper, charity events, local chambers of commerce activities and other event advertising also benefit franchisees as the local face of the franchise.  

Franchisees are already part of a larger network that has their back. Leave the heavy lift to the national campaign. In turn, franchisees can focus on their local program while having the confidence of a name brand with name recognition and reputation behind them. 

WellBiz Brands Inc., the premier franchise portfolio company for beauty and wellness brands, has selected Curious Jane, a national franchise ad agency, to develop and implement the franchise development advertising and marketing strategy for the company and its brands. WellBiz Brands manages five industry-leading brands, Drybar®, Amazing Lash Studio®, Radiant Waxing™, Elements Massage® and Fitness Together®. 

“We are excited to tap into Curious Jane’s expertise to attract qualified franchise candidates,” WellBiz Brands CEO Jeremy Morgan said. “The beauty and wellness space is thriving, and we are confident that, working together, we can identify motivated entrepreneurs and help them pursue their dreams with WellBiz Brands.”

The beauty and personal care market is expected to grow 5.5% per year through 2025. The WellBiz Brands team signed more than 100 franchise agreements across all five brands with investors seeking to diversify their portfolios as well as with entrepreneurs launching their own businesses for the first time. The company’s robust multi-brand platform enables brands to accelerate scalable and predictable growth through access to shared services, infrastructure and support.

Curious Jane President and CEO Lora Kellogg, CFE, said, “We look forward to working alongside WellBiz Brands to raise awareness about their brands and the excellent opportunities available for future franchise owners.”

Curious Jane works with national franchise clients such as Kumon North America, Neighborly Brands, Winmark, Office Pride Commercial Cleaning Services, Plato’s Closet, Once Upon A Child, Play It Again Sports and Goodcents.

About WellBiz Brands Inc.

WellBiz Brands Inc. is the pre-eminent beauty and wellness franchise platform catering to the needs of the affluent female consumer. The WellBiz Brands’ portfolio includes Drybar®, Amazing Lash Studio®, Radiant Waxing™, Elements Massage® and Fitness Together®.  The company’s cross-brand digital marketing program drives effective member acquisition strategies, creating a world-class membership ecosystem. WellBiz One, a proprietary technology platform, enhances studio operations for franchisees, fueling member engagement and retention. With expertise in supply chain management, e-commerce and product innovation, WellBiz Brands provides franchisees with a leading edge. The company has earned national recognition on lists such as the Inc. 5000 Fastest Growing Companies, Entrepreneur’s Franchise 500 and others. For more information, visit WellBiz Brands Inc.

About Curious Jane

Curious Jane is The Ad Agency for FranchisesTM. Founded in Lakeland, Florida, 18 years ago, Curious Jane is a woman-owned business specializing in both consumer marketing and franchise development marketing for franchises. A full-service agency, Curious Jane provides creative and branding, media planning and buying, content marketing, digital advertising, public relations, CRM integration, SEO, website design and development to its clients. Learn more at CuriousJane.com.