Internet, diversity, FranNet-style franchise matchmaking has transformed the industry
In 1987, when Howard Bassuk founded FranNet in Carlsbad, Calif., this was how you let a franchisor know you wanted information about a franchise opportunity:
You ran across the franchise in a magazine, at a trade show or while scarfing down a sandwich at one of their locations, if it was a food franchise. You filled out a form and sent it in. Then somebody in sales would call you and tell you more about the franchise system — which wasn’t hard, because at that stage in the process, you knew virtually nothing.
Well, the game of franchise consulting bears little resemblance to its Reagan Administration self (probably a good thing, since most of us were wearing acid-wash and trying to look like the guy from Whitesnake).
So, as your eyes grow misty with warm memories of Oliver North, Wall Street and Swatches (c’mon, you had ‘em, with the little neon face protectors and everything), we thought it’d be instructive to review the three big ways franchise consulting has changed in 25 years:
- More than French fries. In ‘87, fast food franchising was practically synonymous with franchising. Subway hadn’t even built itself out, having just launched two years before, and there was no sign of Panera Bread, Five Guys, Chipotle or any now-familiar fast casual eateries, much less today’s great service franchises. Diversity has flourished since then — franchising now includes 90 industries and more than 3,000 brands.
- Matchmaking. Back then, franchise consultants were far less developed in their approach to matching entrepreneur with franchisor — if the buyer had enough money and seemed interested and competent, that was about it. But franchisors have learned the hard way that capitalization is just one part of the equation. Much smarter and more targeted approaches by franchisors have led to far better “fits,” and they’ve paid off: Franchise owners who use FranNet succeed at a 91 percent rate.
- The three Ws. The Internet has turned franchise consulting on its head as much as it’s transformed any other part of 21st-century life. In the pre-dot-com days, franchisors dangled scant details about themselves before prospective franchisees; if you told them the whole story up front, the thinking went, why would they need to talk to our salespeople? The Internet did away with all that. Entrepreneurs can find out all kinds of information about you and your system before you even hear from them, and it ultimately leads to more informed choices. Now, the franchise consultant’s role isn’t to load the candidate with information; it’s to pare it down to the best opportunities.
That’s what FranNet does every day through an evaluation process we’ve fine-tuned over our 25 years and are still developing as we roll with a rapidly evolving industry. It’s thrilling, and we can’t wait to see what franchising will look like in 2037!
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