FranX | Business Owner vs. Franchisee

The Next McDonald's (Big Idea)

Is your franchise brand attracting franchise owners or business owners?

Franchise owners buy a franchise for stability and income replacement. They’re not really focused on scale or leveraged growth. Business owners buy franchises for scalability, multi-unit growth and leverage.

Who you attract depends on you, your focus and the capabilities of your management team and system. No matter how much you spend on marketing and franchise development, if your system is not built for fast-growing franchisees, you won’t attract them and smart brokers won’t refer them to you.

One is not necessarily better than the other. But you need to determine who you are targeting and why.

Below are the franchisor characteristics that we think will determine the type of franchisees your system will attract.

BIG IDEA: Know your target franchisees and build your franchise development, management team, capabilities, and support around their needs.

News You Can (Actually) Use

President Biden Removes Diet Coke Button From Oval Office Desk

Who knew? Former President Trump had a special button on his desk to order Diet Coke. President Biden has removed it — wonder what he’ll be replacing it with. Is your brand, product, or service iconic enough to sit on the Resolute Desk?

California Proposes Wealth Tax as Residents Flee

As residents flee, California state legislators propose increases to income tax rates and an all-new, first-time-ever-in-the-United-States-history wealth tax. Demographic changes will be accelerating and so will targeted franchise growth opportunities.

Killer Brands

Shout out to Modern Restaurant Concepts, franchisor of Lemonade and Modern Market Eatery, for being one of the first of the many franchisors that reached out after last week’s FranX post. Lemonade and Modern Market Eatery are emerging fast-casual restaurants that are growing with fresh, healthy menus.

Modern Restaurant Concepts confidently raised their hand to discuss their Why Us/Why Now. Stay tuned to learn more.

Franchisees Kicking Ass: The Franchisee Is King

The Great Franchisee: Francisco Vergara, Pool Scouts*, Orlando

After a career that took him from the Chilean Air Force to multiple business-ownership ventures in sectors ranging from telecommunications to furniture, Chilean immigrant Francisco Vergara is starting the next chapter of his life as one of the newest franchisees with Pool Scouts, the 50-unit pool-maintenance franchise backed by multi-brand franchisor Buzz Franchise Brands.

After graduating from high school, Vergara joined the Chilean Air Force and earned a degree in telecommunications engineering, which he leveraged for a six-year career in the military. Then, Vergara took his first career left turn into civilian life, starting his own telecommunications business in 2011. Vergara started several more companies, including a hardware store and furniture factory, before taking his most recent left turn in 2019, when he learned about Pool Scouts.

Now, Vergara is introducing pool owners in Orlando to Pool Scouts' services as one of the brand’s newest franchise owners.

Yo Broker, Sell My Franchise

Megan Allen of FranNet

After running her own independent franchise consultancy in Denver for more than six years, franchise guru Megan Allen has joined forces with FranNet, a franchise consulting firm with locations across the U.S. and Canada.

Allen got her first taste of franchising in college, when she helped her father grow a franchise that leased equipment for property-improvement plans. Later, Allen joined Colorado-based doggie daycare franchise Camp Bow Wow, where she started as the Director of Strategic Development before working her way up to the role of Chief Operations Officer.

After leaving Camp Bow Wow, Allen started her own franchise consultancy, FranPromise, where she leveraged her experience in the industry to help other entrepreneurs find the right franchise opportunities that aligned with their goals, skillets and values.

During the COVID-19 pandemic, Allen helped her FranPromise clients survive lockdowns and a dire economic downturn by helping to renegotiate leases and walking through loan applications, all pro bono. Allen says she enjoyed helping her clients so much that she decided to expand her business by taking over as the market president for FranNet Colorado, where she will continue aiding other franchise owner candidates, now with the backing of one of the country’s premier franchise consultancies.

Read the full interview with Megan Allen.

The Bottom Thoughts

You’ve heard it before: the first 10 locations dictate the future success of a brand.

Because of this, some franchise brands choose to prove themselves through corporate locations prior to franchising. Some roll the dice and sign franchisees right away.

But what if you were to ask the question, ‘what is better, business owners or franchisees?’

Now, this in no way, shape or form puts down franchisees, but what if we started putting these separate types of business owners into two buckets: those who can scale and those who are basically buying a business to replace income?

If you were to look at the franchisors who go from one to more than 100 locations, we expect the data would point toward them building a club of business owners who think in terms of scale from day one: How can I go from one location to two to three and so on.

So, as you think through who you are targeting as an owner in your brand, who do you want: scalers or single-unit owners?