Thinking About A Franchise In 2021? Three Hidden Gems In The Latest Franchise Satisfaction Report

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If you are considering taking the entrepreneurial leap in 2021 and going into business for yourself, you may be comparing joining a franchise system to building your own business independently. Even if you are still unsure which of these directions you want to pursue, taking a deep dive into the latest Franchise Business Review Top 200 Franchise Owner Satisfaction Report will provide you with valuable added insights.

 This report is produced annually by Franchise Business Review, an outside, third-party organization contracted by over hundreds of franchise brands to survey their franchise owners to objectively gauge satisfaction in a wide range of areas. Their most recent survey posted is a result of surveying over 300 franchise brands with over 28,000 franchise owner survey responses. 

For aspiring entrepreneurs, this report can be invaluable. It not only refers to core considerations such as technology, marketing, hiring, and recruiting, training, business support, leadership, and supplier performance reflecting how the franchisor has been graded by their franchise owners in each area, but it also provides the fundamentals to critique any business being considered whether owned independently or as a franchise.  

There are many hidden gems in this report for those aspiring entrepreneurs considering franchise or independent ownership. Let us look at three key, hidden takeaways to assist the aspiring entrepreneur!

1.      The size and age of the franchise system does NOT dictate franchise owner satisfaction.  Many of the largest brands and networks that we all see and may even frequent on a regular basis are not included in this report nor did they make the rankings if their owners were surveyed. In fairness, they may conduct their own internal satisfaction survey process to at least gain their franchise owner feedback. They are massive networks who have been operating for decades and likely do pay attention to franchise owner feedback in one way, shape or form. However, this report from Franchise Business Review not only makes PUBLIC the results, but it also ranks the franchise brands showing who is best at achieving franchise owner satisfaction. Many of the highest rated franchise systems have less than 100 franchise units and have been franchising for less than five years. There is not a direct correlation between franchise system size and higher satisfaction. One does not simply dictate the other!

2.      Dig deep into the responses and give the ratings for core values, ethics and leadership extra attention and importance. These areas are not often viewed with high importance as they are thought of as more of an intangible; however, survey responses in each of these areas reflect key strengths and weaknesses in place that will heavily determine future success potential for the franchise owner. If core values are not rated high there may be a disconnect between what is being “pitched” or presented to potential franchise owners and what is delivered in service, support, business development and other areas. Core values, ethics and leadership also often directly dictate true commitment to franchise owner’s success and the ongoing investment needed in key areas such as training, human resources/recruiting and operations. This may point to whether there is a short-term financial view to build the profitability of the franchise system owners (franchisor), or a long-term success view for the individual franchise owners (franchisees).  

The answers to survey questions posed in these 3 areas will also often reflect if brand ownership and leadership truly have the extensive operational knowledge of the business. Is it owned, led, and managed by a team with deep industry knowledge and experience specific to that business who is driven by franchise owner success as the primary goal? Or is it being managed by a group who are simply trying to make the franchisor as profitable as possible for the short term without long term franchise owner focus and investment?  Answers to these survey questions can be enlightening and are often overlooked!

3.      The higher the investment and cash required upfront does not dictate higher franchise owner satisfaction or success. Many of the highest ranked franchise brands in this recent report require less than $75,000 investment and less than $75,000 in cash to begin. Many more are  even under $50,000 investment and less than $40,000 in cash required. For example, the top-rated franchise brand requires an investment of $74,560 and it is not a food concept as one might imagine! This is a key consideration as the top reason for any business failure, franchise or independent, is lack of working capital to meet the necessary investment. This is according to the Small Business Administration (SBA) and their ongoing tracking of business loans and most frequent reason for failure. Adequate working capital and necessary investment funds are vital starting any type of new business; however, this recent report exemplifies success is not dependent on the most expensive businesses to start!

The latest franchise satisfaction survey report holds a wide ranch of data, analytics, and helpful content no matter if you are considering investing in a franchise or building your own business from the ground up. Be sure to leverage this added tool to help find the right brand, the right culture, the right investment, and the right potential to help you achieve your entrepreneurial dreams.

FranchisebusinessreviewTop 200 Franchises of 2021

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