An important question every prospective franchisee should be asking is what kind of support you'll receive if you decide to join a franchise company. In many cases, you'll find that the type of support and the resources available will be quite different depending on the size of the franchise company you're looking into.
This isn't to say that one size is better than another--just that you need to evaluate the differences carefully to determine what'll best serve your needs. It's helpful to understand that there are usually three main differences between the big franchise companies and the small ones in the area of franchisee support services. These differences are:
- The people you deal with. In many cases, you'll find the support personnel you deal with in smaller companies are more senior in the organization and more willing to do "whatever it takes" to help you deal with issues, even if the issues aren't in their area of specialty. You're almost certainly going to be dealing with fewer support employees, so you'll probably get to know them much better than in a big company and form a stronger personal relationship.
The flip side of this is that in a larger company, you're usually going to find more specialization in support employees, which could mean more expertise and experience available to deal with whatever particular issue you're facing. This can be a huge advantage, because no one is going to have to use you or the issues you face in your business as a training ground for the franchise.
The key point in making your decision is not so much which of these situations you will have, but rather how comfortable you are about whatever approach is going to be taken and about the actual people you're going to be looking to for support. Also, keep in mind that small companies often grow into large companies, so even if your support is initially coming from a vice president or above, that'll probably not be the case in the long run.
- The resources at their disposal. One advantage of large franchise companies is that they typically have much larger budgets and access to far more resources (especially the ones that cost a lot of money) than the smaller companies do. These resources could include third-party support, outside training programs and materials, real estate and demographic modeling, computer programs and other technical assistance.
Small franchise companies usually make do with the essential items, but you almost certainly won't confuse them with a large corporate environment. The small companies tend to focus on the most important, direct, critical path items to get a new franchisee up to speed in a hurry at the lowest possible cost. There's nothing wrong with this focus, as long as it produces the desired results.
Either one of these approaches to resources can work just fine for a new franchisee. The secret is to call other recent new franchisees and find out if everything they needed in relation to their new unit opening was available. If they're happy and successful, then you probably will be too--with or without lots of expensive extras in terms of resources.
- Their flexibility concerning rules. This is one of those areas that really differentiate many of the larger franchise companies from the smaller ones. In a large, seasoned and successful franchise system, you'll probably find they have extensive and well-documented rules for pretty much anything that might happen in your business. They probably also have lots of bureaucrats whose function is to observe and ensure compliance with all those rules.
In a smaller franchise system, you'll typically find far fewer restrictions, and it's highly unlikely that they've developed a "police force" to ensure compliance. Most franchisees in smaller systems make every effort to follow the system and comply with all the rules, but they also know that they can question things and may be allowed more flexibility to experiment in some areas.
Again, neither approach is right or wrong--you just need to evaluate it in the context of what works best for you and what you are most comfortable with. There's enormous security in having a very strongly fixed system that produces predictable results--far less risk to either the company or the new franchisee. You can also have a wonderful sense of accomplishment for many people when they are allowed to implement ideas they have for improving their business.
It's obvious that there is no right or wrong answer in terms of whether large or small systems are better. What is an absolute is that you need to do your research on any franchise system to find out if the existing franchisees are happy with the support they've gotten or if they feel there were gaps. It can be wonderful to be surrounded by a huge support structure, but a little elbow grease and guerilla marketing can also go a long way toward happiness and success.
Jeff Elgin has almost 20 years of experience franchising, both as a franchisee and a senior franchise company executive. He's currently the CEO of FranChoice Inc., a company that provides free consulting to consumers looking for a franchise that best meets their needs.