The Inside Scoop

Signing the Franchise Agreement

August 2003: Signing the Franchise Agreement

Besides loving the Cold Stone product, Frerich found the people at the corporate office (which Frerich generally refers to as "The Creamery") to be helpful and enthusiastic about the product and the franchise opportu-nity as a whole. According to Frerich, when she was in the thick of her due diligence that summer, she found out Cold Stone was opening a flagship store in New York City's Times Square. Believing this development would greatly raise awareness of the concept in the Northeast, thereby increasing the chance of success if she jumped onboard at that time, she made her decision. Frerich recalls what a positive experience it was working with the franchisor during her research as well as after signing on. "The Creamery is very selective in whom they award franchises to, so there was a bit of a process there even once we decided on Cold Stone," she says. "They had to make sure it was the right fit."

Once Frerich had her stamp of approval from the franchisor, she signed her franchise agreement and was off to choose a location, sort out leasing agreements, and hire a contractor to build out her shop. The franchisor was key in finding her Westfield, New Jersey, location, assisting Frerich in the whole process. Working with contractors was another new experience that she had to master in the busy nine months between signing the franchise agreement and opening the doors. "Every day was a learning experience," she says. "The nice thing about it was [that] there was always someone at The Creamery to support me and help me through it."

January 2004: Attending Ice Cream University

It was one thing to taste the ice cream in San Diego, but Frerich was in a whole new world when she attended the one-two punch of the Cold Stone annual franchisee convention in Las Vegas, followed by two weeks at Ice Cream University in Scottsdale, Arizona. "It was one of the greatest experiences throughout this new adventure with Cold Stone," Frerich says.

After a week spent soaking up the wisdom of veteran franchisees in Las Vegas, Frerich immersed herself completely in the Cold Stone way of life for the two-week course. "It was great talking to people in Las Vegas, jotting down ideas and sharing my challenges with my fellow franchisees-[in-training]." Her days were filled with hands-on training, serving customers in a real store, and classroom instruction-while she spent her evenings studying for the final exam at the end of the course. After finishing with the highest exam score and being named the Scoopa Cum Laude, Frerich left the place bubbling with enthusiasm and with the camaraderie of her fellow franchisees-in-training. "I was fired up," recalls Frerich. "I wanted to jump right in."

Spring 2004: The Final Stretch

It was crunch time for Frerich-the spring saw her building out her store, setting up equipment, hiring a staff, and trying to do it all while not pulling her hair out. "I was coming down to the store to see what progress was being made, bringing coffee and doughnuts to stay on the good side of the contractors," she says. "But there was a point where [I thought] 'I'm this 5-foot 2-inch female coming to a construction site where I have to let them know they're working for me, and that I have expectations and have to challenge [the contractors] if they aren't being met."

Not only was she learning how to manage contractors, Frerich was also getting her building and business permits in order, another element she was learning as she went. "I was hiring a crew [then, too], so not only did I have a building, but I also had personalities and energy to fill that building." Hiring and training her staff was one of the biggest challenges prior to the grand opening, she says. Fortunately, having had hands-on training at Cold Stone's Ice Cream University, Frerich had experience to draw on when training her crew during the roughly five days she had with them before the grand opening. "I was very proud of my crew because it is a lot to learn-and they did a great job. As soon as the customers started to come in, they knew what had to be done," she says. And if they didn't, Frerich was right there beside them to work it out together. "That was the biggest thing. They knew I wasn't asking them to do anything I, myself, wouldn't be willing to do."


Michael H. Seid offers aspiring entrepreneurs advice for each stage of the franchising process:

  • CHOOSING FRANCHISING: Your entire life will change. Make sure that you like the business and would be proud to own that type of business-and that your family supports you. Finally, says Seid, "Be certain your economic expectations are realistic."
  • SIGNING THE FRANCHISE AGREEMENT: Get a lawyer who specializes in franchising as your advisor. Read the franchise agreement from front to back-note the boilerplate, which will be important in the event of a dispute. Says Seid, "Be prepared to walk away from the franchise if the agreement does not meet your needs or reflect the salesperson's promises."
  • TRAINING AND DEVELOPMENT: "Don't be passive during training. Ask questions," says Seid. "You are paying for information that enables you to open, manage and operate the franchise. If you don't fully understand anything, ask the franchisor if you can extend your training."
  • THE FINAL STRETCH: Find time to relax a bit, as it will probably be a long while until your next free day. "While it may seem like an inopportune time, [a break] will release some of the built-up stress, allow you to focus on the future, and feel good about yourself and what you will be accomplishing," says Seid.
  • GRAND OPENING: Disasters always happen, so during development, make friends within your local franchise community. "The joy of a great franchise system is that the other franchisees are not just neighbors, they're family, and they will usually do whatever it takes for you to succeed. That includes loaning you replacements for the three staff that did not show up. Rely on the franchise system, not just the franchisor."
  • THE NEXT STEP: Get all the information you can from the franchisor, your lender and other multiunit franchisees before you make your decision to grow. "Running two locations is no harder than running one location. Running three locations is harder than running 50. Ask anyone who has been through the growth cycle about the pain of growing from two to three," says Seid. Get a business advisor, franchise consultant or franchise lawyer, and make sure you have a management team in place that can help you grow.

Michael H. Seid is managing director of Michael H. Seid & Associates, a West Hartford, Connecticut-based management consulting firm specializing in the franchise industry.


Like this article? Get this issue right now on iPad, Nook or Kindle Fire.

This article was originally published in the January 2005 print edition of Entrepreneur with the headline: The Inside Scoop.

Loading the player ...

Shark Tank's Daymond John on Lessons From His Worst Mistakes

Ads by Google

Share Your Thoughts

Connect with Entrepreneur

Most Shared Stories