Switching Over to Franchise

If You Break It, Will They Come?

Once you've made the decision to explore franchising, the question then becomes, how will you introduce this "new channel" into the system?

Clearly, you can't jeopardize existing distribution or your reputation in the marketplace by introducing a program that fails. Thus, the last step in the process of implementing a franchise program must account for the successful launch of a dealer conversion franchise.

With this in mind, you may want to "test the waters" among your dealer base by surveying a sample of dealers before implementing a program. This allows you to determine the dealers' interest in obtaining additional support, the specific services that dealers believe could add value and their willingness to conform to standardized systems of operations. It also provides you with some understanding as to the dealers' desire and willingness to use a common advertising fund to promote a common brand. These answers will help you gauge the "salability" of such a franchise among dealers before actually offering the franchise.

Assuming the answers to these questions remain favorable, you would then begin the process of structuring the offer. Our research indicates that one of the most important elements of successful dealer conversions is the active involvement of dealers in the process of developing the franchise program. And while we have developed some proprietary methodologies to introduce such a program, the most important rule is that a program can never be developed in a vacuum.

Ultimately, the key to the success of any conversion program lies in the creation of the perception of "incremental value." If your dealers are to support this offering, it's our experience that they must have a hand in its creation. That doesn't mean you should abdicate your responsibility for the creation of this program. But, as with everything in franchising, you need to structure this as a "win-win" to give it a chance for long-term success.

And if you can incorporate that "win-win" into your this relationship, franchising can be a much better means of controlling a channel of distribution.

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Mark Siebert is the CEO of the iFranchise Group, a franchise consulting firm that has worked with 98 of the nation's top 200 franchisors. He can be reached at 708-957-2300 or at info@ifranchise.net.
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