By Greg Jones: Know your financials, be personable and get creative
For individuals thinking about opening a franchise as a sole proprietor, there are lot of “do’s and don’ts” you should be aware of. Here’s a quick playbook to follow for 2012:
Before meeting with a potential financier
Have your financial records in order: Print out your current profit-and-loss statement (P&Ls), a balance sheet, accounts payable, accounts receivable and any other financial information ready.
Prepare a presentation on your business, including an introduction, history and background, executive overview, services and/or products, financial projections and use of funds. Don’t forget to present information on the franchise concept you are interested in. A financially solid franchisor will usually help with obtaining your loan.
If you are attempting to work with a bank, you will need a “collateral game plan” to support loans and credit. The current lending environment makes it difficult to obtain a loan. The banking community is on lockdown and almost strictly loaning to individuals who have plenty of cash, revenue and securities.
Rookie mistakes to avoid
1. Rushing services and products to market without proper due diligence.
2. Not developing a strong marketing program before launching a product.
3. Not forging a strong partnership with vendors— landlords, suppliers, franchisors and the local community.
4. Not making enough of a buzz when entering a market.Come in with a bang.
5. Not rehearsing before the grand opening. Practice, practice, practice prior to inviting customers into your store or office.
Key strategies to gain (or steal) market share
1. Bring a more personal touch to clients and prospects.Smaller companies have an opportunity to become More intimate with their clients and prospects. Build relationships.
2. Having a bricks-and-mortar location in the market allows for community relationships. People tend to do business with franchisees that are visible.
3. Get creative with marketing: Social media, car wraps and hosting events will bring attention to your products and services.
4. Third-party teaming and testimonials will help bring credibility, and put individuals at ease when looking at your products and services.
In franchising, you are always going against the clock, often working with funding limitations and striving for that winning play. But always have the right game plan.Use many playbooks, and never hesitate to go back to the chalkboard.
About Greg Jones
Greg S. Jones is CEO of Vienna, Virginia-based BookKeeping Express. Previously, he was vice president of sales for Fransmart in Alexandria, Virginia, a company specializing in franchise sales, development and support for franchisors and franchisees.Jones specializes in real estate and Five Guys Burgers and Fries franchise development in Florida. He can be reached at firstname.lastname@example.org.