Today's episode is going to be a little different — because today, we're talking about one of the most overlooked growth strategies in franchising… networking.

Now before you roll your eyes and think we're talking about awkward business card exchanges and stale coffee at chamber events, let me tell you — our guest today has completely redefined what networking actually means.

Toni Harris Taylor is known as the Networking Queen, and after this conversation, you're going to understand why. She's a franchisee, franchise broker, keynote speaker, author of 16 books, creator of the 'Show Up, Be Up, Follow Up to Blow Up' philosophy, and founder of the nonprofit Multicultural Franchise Connectors.

But what really makes Toni special is that she doesn't just teach networking — she lives it. She's built relationships that open doors, create franchise growth, generate business opportunities, and connect people in ways most of us never even think about.

In this episode, we're going to talk about how franchisors can stop chasing cold leads, how franchisees can become the connector in their local market, and why the best business opportunities are usually sitting inside someone else's network.

And as a bonus today, this is also the first official appearance of Gary Fieldsend from FranMan here on the podcast — so this conversation turns into a really fun and practical discussion about relationships, referrals, and how real networking actually works in the franchise world.

Time Stamps

Toni Harris Taylor Intro

00:00:33

Segment 1

00:02:48

Get to know Toni Harris Taylor

Segment 2

00:17:08

Topic Segment – Using Networking to Grow Your Franchise

Segment 3

01:05:26

Quickdraw Questions

Core Theme

"Networking is not a soft skill in franchising—it's a revenue-generating system."

PART 1: Franchisors

How to Network to Find MORE and BETTER Franchisees

1. Stop Waiting on Leads—Start Building Relationships

• Most franchisors rely too heavily on portals and paid leads
• Those leads are often:
• Over-shopped
• Not qualified
• Not culturally aligned

"The best franchisees are not sitting on a portal—they're sitting in someone's network."

1. Stop Waiting on Leads

2. Identify "Connector Categories" Instead of Chasing Individuals

Give them something tactical (they will love this)

High-value connectors:

• Franchise consultants & brokers
• CPAs & financial advisors
• Business coaches
• Commercial real estate agents
• Immigration attorneys (E2 visa)
• Community leaders

"Don't just network randomly—build a strategy around WHO already knows your ideal franchisee."

3. Create a Local + National Networking Strategy

Most franchisors think too narrow.

• National: conferences, industry events
• Local: chambers, business groups, meetups

"Your next franchisee might already live in your backyard—you just haven't shown up."

4. Show Up as a HUMAN, Not a SALES MACHINE

This is where YOU shine.

• People don't buy franchises—they buy confidence
• Confidence comes from:
• Trust
• Connection
• Consistency

"If your only touchpoint is a discovery day, you're already too late."

5. Follow-Up is Where Deals Are Won

Bring your signature framework in cleanly:

• Most franchisors don't lose deals from lack of interest
• They lose them from lack of follow-up

"Show up. Be up. Follow up. That's how you blow up your franchise development."

PART 2: FRANHCISEES

How to Network to GROW Their Business

1. Corporate Marketing is NOT Enough

• Franchisees who rely only on brand marketing struggle
• Local relationships drive:
• Referrals
• Partnerships
• Repeat business

"National marketing builds awareness. Local networking builds revenue."

2. Become the Local "Connector" in Your Market

This is gold.

• Franchisees should not just attend events—they should:
• Introduce people
• Host small gatherings
• Be known as a resource

"When you become the connector, you stop chasing business—business starts chasing you."

3. Build Strategic Referral Partnerships

Give examples (they love specifics):

• Daycares ↔ kids franchises
• Gyms ↔ health brands
• Realtors ↔ home services

"One strong partnership can outperform 1,000 cold leads."

4. Consistency Beats Charisma

This is a reality check they need.

• It's not about being the loudest person in the room
• It's about:
• Showing up regularly
• Being reliable
• Following through

"The franchisees who win are not the most talented—they're the most consistent."

5. Track Networking Like a KPI

Now you're speaking their language.

• # of events attended
• # of meaningful conversations
• # of follow-ups
• # of referrals generated

"If you don't measure it, you won't scale it."

Close

"Franchising is a people business.

The brands that grow the fastest—and the franchisees who make the most money—are the ones who master relationships, not just marketing."

Toni Harris-Taylor

Drastic Results Marketing and Sales Coaching

toniharristaylor.com

713-387-9273

Kit Vinson

FranMan Inc.

www.franman.net

[email protected]

214-736-3939 x 101

My Podner in this episode is Cheryl Mullin and she's going to talk with us today about Financial Performance Representation! Man, if that doesn't make you salivate then you are no franchisor in my books. This can be a very dense topic but I am confident that Ms. Cheryl help us demystify this topic and maybe even help us pull our heads out from underneath the covers every time it is mentioned. But who knows, she may even have us running for the hills even faster.

Time Stamps

Cheryl Mullin Intro

00:00:30

Segment 1

00:02:49

Get to know Cheryl Mullin

Segment 2

00:20:31

Topic Segment – Financial Performance Representation

Segment 3

01:57:46

Quickdraw Questions

Topics covered in this episode:

• History of the FDD
• What is a financial performance representation?
• Is it absolutely necessary for a franchisor include a financial performance representation in their FDD?
• Are there legitimate reasons that a franchisor wouldn't make an FPR?
• If a franchisor wants to include financial information in its FDD, is there certain information that it must provide or a required presentation format?
• Why is it important to include financial information in an FDD?
• Does the Federal Trade Commission allow for any exceptions this disclosure of financial representations?
• Are there any rules or limits that apply to financial performance representations?
• Where do you see most franchisors get in trouble?
• What advice would you give to a franchisor?

Cheryl Mullin

Mullin Law PC

[email protected]

www.mullinlawpc.com

972-852-1703

Kit Vinson

FranMan Inc.

www.franman.net

[email protected]

214-736-3939 x 101

My Podner in this episode is Jordis Small and she's going to talk with us today about branding. Branding is a word that is used in many contexts and sometimes misused and misunderstood. Jordis promises to clear all of that up for us today. This will be a fun ride

Note: Ms. Jordis is recovering from a nasty cold and she lost her voice. The voice is scratchy but the content is GOLDEN.

Time Stamps

Jordis Small Intro

00:00:32

Segment 1

00:02:42

Get to know Jordis Small

Segment 2

00:18:00

Topic Segment – Branding Your Franchise

Segment 3

01:14:12

Quickdraw Questions

Topics Discussed in this Episode

• What is your brand?

  Most folks think it's logo, fonts, colors... It's much more

• Why do you need to know your brand better than your spouse?

  Are you prepared to articulate your brand to potential franchisees?

• How to audit your own brand...

  Test your logo to see if it's good, is everything in alignment with the vision of the company, will people understand it with you telling them?

• What makes a GOOD logo?

  Is your logo scalable, timeless, and appropriate for growth?

• Why do you need a robust brand guide before franchising?

  What is worth including, like color usage ect…

• How to set up your franchise for success through creating an asset library. Basically pre making various marketing materials for them so they don't DIY.

• Why does this brand work now? Prepare for growth and longevity.

Jordis Small

Stellen Design

www.stellendesign.com

[email protected]

310-418-6287

Kit Vinson

www.franman.net

[email protected]

214-736-3939 x 101

My Podner in this episode is Tom Wells and he's going to talk with us today about the challenges of scaling a brand over 50 units. It's a moving target and things change, and he's going to share some REALLY COOL stuff with us today.

Time Stamps

Tom Wells Intro

00:00:31

Segment 1

00:02:13

Get to know Tom Wells

Segment 2

00:27:05

Topic Segment – Challenges of Scaling to Over 50 Units

Segment 3

01:06:27

Quickdraw Questions

Topics Discussed in this Episode

Key areas franchisors miss in their first year:

• This ultimately comes down to People, Process, and Prioritization. Many entrepreneurs didn't become entrepreneurs to focus on process and structure – the most successful ones hire around this need.
  • People: You ave to get the best team and figure out where to hire over time. Requires culture of accountability which sounds easy but is difficult to implement. Additionally, the founder(s) need to manage their people, but also give them authority to execute.
  • Process: What works at 10 units or 20 units, doesn't work at 50+ units. A leader or team can run around putting fires out at 10 units, but you can't do this at 50+ units. Many organizations never think about what process is needed to make better decisions over time. Additionally, need to want to get and understand the right data which is hard with limited resources.
  • Prioritization: Everyone has a day job; can only take on a few big strategic initiatives at a time. Most founders have a list of 20 major initiatives they want their team to do at any time. Some get done, some don't – all of them are not done at the highest level. We spend a lot of time focusing each year on what are the main ones to provide the biggest benefit to the business (this is very hard) and then helping the teams focus on these items. Do this repeatedly and the business constantly evolves nicely.
• Being Ready to Grow: To grow from the concept stage, you need the below but I always start with "If it's a great investment for the franchisee, the brand will generally do very well":
  • Great unit economics: This is almost impossible to fix along the way. If the concept doesn't work from the start, it's unlikely to have better unit economics along the way. Our view is 3 year or better payback is top 25%. Anything better is best in class. We also look at store level margin as it provides insight into cushion for franchisee performance (ie: very low margin has limited room for error).
  • Differentiation: It's important to have something that sets a brand apart from its competitors. This applies to all concepts regardless of industry. Tons of competition in restaurants, how are we getting a competitor to pick us vs their 100 other options (product, service, experience, technology). In services, there are tons of local companies that can do plumbing, why pick a franchise (marketing, service, answer phones, clean looking techs, technology, etc.)
  • Structure / Process : This is different from the process above. This is being able to sign franchise agreements knowing that you are growing a repeatable concept (ops manuals and guides, trade design, product, branding). You don't want different menus at different locations, different store designs, etc. Key to have something where there is benefit of scale and franchising.
• How brands scale: Most grow without a lot of thought of who the franchisee is and where they are growing. Need to be thoughtful here.
  • Who the franchisee is: Over the first 10 or 20 locations, you really figure out who is the best operator for a brand. Additionally, you learn who is not a fit. These need to be addressed thoughtfully otherwise a brand will struggle with bad franchisees as it gets larger.
  • Where you grow: It's easy to sign franchise agreements with interested franchisees that are far away. This depends on complexity of the concept. For example, restaurants require distributions centers and are hard for corporate to help with when far away. Generally easier to go concentrically with restaurants, especially with brand loyalty.
  • How you develop: Growth is great, but ultimately the franchisee needs to succeed. It's better to make sure you have the right operator and right site, rather than compromising just to grow. We see so many brands that are great, but have struggling units where they compromised early – this doesn't show up for a few years.

Books Mentioned

The Hard Thing About Hard Things

by Ben Horowitz

Unbroken

By Laura Hillenbrand

Tom Wells

www.10pointcapital.com

[email protected]

404-444-3110

Kit Vinson

www.franman.net

[email protected]

214-736-3939 x 101

My Podner in this episode is Michael Peterson and he's going to talk with us today about the mistakes that new franchisors typically make during their first year of operation. Some of these mistakes can be quite expensive, while others can lead to the death of your entire system. If you are a newly minted franchisor, or if you are about to start your journey, this is one that you won't want to miss.

Time Stamps

Michael Peterson Intro

00:00:31

Segment 1

00:02:37

Get to know Michael Peterson

Segment 2

00:20:39

Topic Segment – New Franchisor Pitfalls

Segment 3

01:03:05

Quickdraw Questions

Topics Discussed in this Episode

Key areas franchisors miss in their first year:

Pre-launch

• Not getting the FDD to fully capture the business model. This leads to something so prevalent that I came up with a name for it; the 2nd year re-write. So many franchisors make massive changes to their second year FDD either because they didn't capture the existing model in the first year, or they didn't have someone walk them through the thought processes they should be going through on every item before they commit it to paper.
• Having "to be implemented" clauses in their agreements. The most common one I have seen here is a national ad fund, though I have seen tech fees quite a few times as well. When your franchisee #1 or #2 has been operating for 3 years, paying you your royalty only, and suddenly you decide your system is big enough to justify the advertising fund of 1-3%, believe me they will not be happy. Start taking this from day one, even if you turn around and spend it in their market.
• Cutting corners or coming in underfunded. This is probably the #1 cause of failure of young franchisors. Deciding to write an operations manual in-house, find the cheapest franchise attorney possible (or, worse yet, trying to do an FDD without a franchise attorney), not having quality marketing materials, not having funds set aside for franchise sales; these are so self-defeating.
  • A bad operating manual can lead to system problems and even litigation.
  • If you succeed as a franchisor you will end up using a good franchise attorney, if you start out with inexperienced or ineffective counsel, you'll just pay in negotiation, litigation, or just headaches before you switch to better counsel.
  • Your marketing materials are your first impression, you have to make them count.
  • Franchise sales cost money, period. If you don't have a good marketing budget you will struggle to grow. Think about this. Each year, you are going to spend between $6,000 and $25,000 on renewal, depending on how many registration states you go into and how complicated your audit is. I would guess the average is close to $12,000. If your lead generation spend results in one sale, then you have an extra $12,000 in costs for that sale. If you have a robust budget and someone solid handling franchise sales, and you award 3 franchisees, then the renewal is only adding $4,000 cost-per-close. Big difference.

Post Launch

• Hands down, the biggest mistake a franchisor can make is bringing in the wrong franchisee. If you have been doing all the 'right' things, spending money, having a professional franchise sales person either in-house or outsourced, reaching out to brokers to talk about your brand, and 6 or 12 or even 18 months in you don't have a franchise sale, that can be frustrating. It also might happen; the first franchisees are the hardest to find (lets delve into that). I have seen this situation cause many franchisors to award a franchise to someone they shouldn't and regret it for years to come.
• Not having a culture of compliance from day 1 is another seemly small issue that will come back to haunt you. If your FA calls for quarterly or annual financials from your franchisees, get them even if you don't know what to do with them! If your franchisees have a required add spend, monitor it from day one. Or better yet, engage with them and help them spend it correctly, but either way make sure they are spending it. If there is a clause you are not enforcing from day one, throw it out.
• A problem many new franchisors think they wish they had; growing too fast. I have been in this position. I am talking about 4 stores open in January and 120 open that December fast! Trust me, you don't want this kind of growth out of the gate.
• Compromising to get a deal. . . I put this one last because it very well may be something you need to do. As I mentioned, first franchisee is HARD! It may be may be reasonable, appropriate, or even necessary to 'give' on the first franchisee, maybe even on the first few. But be careful. If you are giving a bigger territory, are you really setting that franchisee up so that there is no chance of you putting someone into the same market and putting local brand awareness 100% on their shoulders? Are you offering a refund clause that you can't really afford, from a capital cost of onboarding stance? Make sure your attorney is involved here and be careful. And again, don't be afraid to say no and walk away.

Books Mentioned

Think Like a Freak

by Steven D. Levitt, Stephen J. Dubner

The Memory Illusion

By Julia Shaw

Eye of the World

Robert Jordan

Michael Peterson

www.franchisebeacon.com

[email protected]

949-282-7304

Kit Vinson

www.franman.net

[email protected]

214-736-3939 x 101

My Podner in this episode is Tom Portesy and he's going to talk with us today about how to maximize the return on your investment at a franchise expo, how to avoid the pitfalls, and best practices that will help you represent your brand in the best light.

Time Stamps

Tom Portesy Intro

00:00:27

Segment 1

00:03:41

Get to know Tom Portesy

Segment 2

00:18:22

Topic Segment – The Franchise Expo

Segment 3

01:03:42

Quickdraw Questions

Topics Discussed in this Episode

• What is a franchise expo
• Short history of the expo
• How to manage realistic expectations of an expo
• Know your objective
• DOs and DON'Ts at an expo
• Take advantage of the free training offered by MFV
• Spend time developing your opening line
• Know the value of a lead
• Control how much time you spend with each person
• Which industries do better at an expo

Tom Portesy

MFV Expositions

[email protected]

https://www.franchiseexpo.com/

Kit Vinson

www.franman.net

[email protected]

214-736-3939 x 101

My Podner in this episode is Jackie Hoegger and she's going to talk with us today about how to market to prospective franchisees. This conversation spans topics such as website design, digital marketing, even down to how you treat your existing franchisees. This is our first episode on the topic of marketing and we came out of the chute with a GREAT one..

Time Stamps

Jackie Hoegger Intro

00:00:33

Segment 1

00:05:26

Get to know Jackie Hoegger

Segment 2

00:16:50

Topic Segment – Marketing to Prospective Franchisees

Segment 3

01:00:57

Quickdraw Questions

Topics Discussed in this Episode

1. Brand on Fire (00:21:49) - Elevate your brand as the key authority in the franchise world - Go beyond simple brand awareness and stand out….provide MORE value than your competitors.

• Know your "story"
• Know your passion and learn to convey your passion to the prospective franchisee
• This is a marathon, not a sprint
• Hone in on your God given skills
• What is it that makes your concept special
• Most franchisors will need help developing this point

1. Social All The Way (00:29:12) - Tell your story as a Franchisor on social media - your new franchisees are watching. Get them to trust you as a leader before they ever make the call or the link online to talk.

• Social media is the best ROI on delivering your message
• Know the target profile of the perfect franchisee, then dial in your social media advertising
• Social media not only allows people to see you from the outside, it also allows people to be able to trust you

1. The Power of the Existing Franchisees (00:32:16) - Let them sing your praises! Let them garner the attention of YOU!

• Your franchisees are your #1 asset. Nobody can credibly sing your praises better than your current franchisees
• Prospective franchisees are most interested in what your existing franchisees say about you, and the WILL ask.
• Coach your prospective franchisees before they make the validation calls so that they know how and when to ask follow up questions. If they talk to an existing franchisee who does not sing your praises, then teach them how to ask questions such as "How much do you spend on marketing?"
• Marketing isn't just advertising, it is much more. It also includes soft skills such as how you treat your franchisees. Existing franchisees are a DIRECT arm of your marketing
• Communication is king

1. Web oh Web (00:37:02) - Your website needs to simply rock - It's the front door to your business and future franchisees will go there FIRST! Make it EASY PEASY to find out how to gee a Franchisee.

• Spend money on your website – it IS marketing
• Spend money on a good CRM software that will allow you to grab a lead and not lose it
• Calculate the value of a prospective franchisee over the life of the contract to help you stay motivated NOT to lose a lead
• It may take several touches with a prospect before they decide to move to the next step. Use the CRM to maintain communication with a prospect.

1. Keep is Simple in a Complicated Process (00:46:00) - Give them a simple process from the first bite. As you discover if they can fit into your culture ad family - make them feel welcomed! Of course - Discovery Day is your wow factor!

• They should look back and thing, "This was the easiest thing I've ever done."
• Make it fun, energetic, and educational
• Assign the prospect to one person and that person "owns" them. This makes the prospect feel special and prevents them from falling between the cracks

1. Eyeballs and Attention (00:49:04) - Optimize your Appeal and let them see the way you treat your current franchisees as true partners…..support programs - rapport with each other - and mostly - the dream to have multiple units.

• Treat franchisees as true partners
• Franchisees are watching EVERYTHING you do, as if you were on a first date
• They pick up on kindness, humility, and compassion, and this is the best marketing you can do
• The power of corporate culture is under-appreciated
• You can do all the marketing you want, but at the end of the day, if your guest experience isn't there, you are fighting a losing battle.

7, Hire an Agency (00:55:21) - They can develop a 3 pillar strategy to drive conversions to your website which leads the first touch.

• Do what you do well, and hire done what you cannot do
• It's OK if marketing is not your "gig", but if it isn't, you should hire it out.
• Have a marketing budget before you begin. Your marketing "war chest" should have $50K+. However, every marketing campaign is different.

Books Mentioned in the Episode

Crush It

By Gary Vanerchuck

Jackie Hoegger

Hoegger Communications

[email protected]

www.teamHoegger.com

940-631-7999

Kit Vinson

www.franman.net

[email protected]

214-736-3939 x 101

My Podner in this episode is me, Kit Vinson (finally!), and I'm going to talk to you about what franchisors should know about their franchise operating manual.

Time Stamps

Kit Vinson Intro

00:00:29

Segment 1

00:02:15

Get to know Kit Vinson

Segment 2

00:13:30

Topic Segment – The Franchise Operating Manual

Segment 3

00:00:00

There are no Quickdraw Questions in this episode

Topics Discussed in this Episode

What's Included in a franchise operating manual?

Every manual is customized to the industry of the company, but there are elements of a franchise operating manual that are common to all manuals.

• Introductory chapters
• Pre-Opening chapter
• Human Resource chapter
• Daily Operating Procedures chapters
• Marketing chapter
• Sales Chapter

What is the process for producing a franchise operating manual?

• Creation of the custom outline for the manual
• Legacy documentation review
• Identification of the content experts
• Information gathering phase
• Production phase
• Revision phase

Make the manual creation process fun so that you can start the flow of your team's creativity juices.

How often does the typical franchise manual need updating?

Manual updates should be completed on a regular basis. Younger franchise systems will need to update their operating manual more frequently because their systems seem to evolve at a much faster pace than that of a mature franchise system.

If you do not keep your franchise operating manual updated regularly, you increase the probability of you having to explain to a judge why your manual isn't up-to-date.

How are franchise operating manuals typically distributed to the franchisees?

• Hard copy (paper)
• PDF
• Web based platform (Wiki-style)

Hard copy manuals have extreme limitations. They are not secure. They are only a snapshot of your system on that day. Media limitations.

PDF manuals are searchable, but they are not secure. They are also a snapshot of your company's system on that day. They are relatively easily to update but you run the risk of having multiple versions of your manual floating around your system.

Web based, online operating manuals are secure, they are extremely easy to update, you can track your franchisees activity in the manual, and you can include multimedia content such as videos.

What are the functions of a franchise operations manual?

First, the Franchise Operations Manual is the authority document of the franchise System Standards. The System Standards are the standard procedures that a franchisor requires of all franchisees in order to duplicate the customer experience in every location. The customer experience is the driving force behind profitability. If you can duplicate a favorable customer experience, then you may have a business that you can franchise. If you have a well prepared Franchise Agreement, it will refer to the Franchise Operations Manual as the System Standard. This way, as your system grows and your System Standards change, you only have to update the manual instead of updating the Franchise Agreement.

Second, the Franchise Operations Manual is the most effective tool for protecting your Brand. A company's Brand is one of its most valuable assets. The Brand is also the asset that is at most risk when a company decides to franchise. When you franchise a concept, you are putting your Brand in the hands of other people, all of whom likely have different ideas about the best direction for the company. A properly prepared Franchise Operations Manual, with well-defined and organized System Standards, will be one of the few tools you have to manage the Brand and control the franchisees when they try to act on their vision for what is best for your Brand.

Third, the Franchise Operations Manual will likely be the principal tool for training new franchisees. It is the "Your Company for Dummies" book. You have to assume that most of your franchisees will not have experience in your industry. They may not have any business experience at all. It is very common for a retired schoolteacher or a retired military person to invest in a franchise. This is not to suggest that schoolteachers or military personnel don't have any business savvy, it is only to say that they were not formally trained in business and have not practiced it during their career. Your manual needs to be a document that not only trains them on your system of providing a favorable customer experience, but also one that brings them up to speed on how to manage a business.

Fourth, a well prepared documentation of the procedures that has helped make your company a success will help you sell your concept to potential franchisees. Put yourself in the shoes of a potential franchisee. If you received a Franchise Disclosure Document (FDD) that showed you that the company had a 50 page document describing all of its operating procedures, you might be a little concerned.

You will also take your Franchise Operations Manual with you when you meet with potential franchisees for the first time. In that meeting, you will attempt to sell the concept to the prospect. Like all good sales people, you will likely have a few sales tools to assist you. You will probably present a PowerPoint presentation of the concept, you will review the company's performance in the FDD, and you will present the Franchise Operations Manual as your proof that you have a well documents system for success.

Fifth, you don't get very many opportunities to convey your corporate culture to your franchisees. Initial training lasts a week or so. Annual conferences last a few days per year. Ultimately, it is the franchise operating manual that will have the most contact with your franchisees, so what better place to show them who you are.

Kit Vinson

www.franman.net

[email protected]

214-736-3939 x 101

My Podner in this episode is Brendan Charles and he's going to talk with us today about what franchisors should be teaching their franchisees about site selection, real estate negotiations, and build-out. Bad decisions in these areas can be detrimental to the success of the location. Everybody has some skin in the game here. This discussion will benefit both new and seasoned franchisors.

Time Stamps

Brendan Charles Intro

00:00:28

Segment 1

00:02:44

Get to know Brendan

Segment 2

00:15:38

Topic Segment – Site Selection, Real Estate, and Buildout

Segment 3

01:25:10

Quickdraw Questions

Topics Discussed in this Episode

• You only get one chance to get the real estate right.
• Real estate is one of the three main controllable in a franchise business model but real estate is only a "controllable" until you sign the lease.
• If you don't know what your break even is BEFORE you start looking for real estate, then your real estate decision could break you.
• #1 rule in site selection – Never fall in love with a space.
• The real estate brokers' incentives are not necessarily aligned with yours – the more you pay in rent, the more the broker gets paid on commissions
• Know exactly what your site selection criteria are BEFORE you start your search
• How do you develop site selection criteria when you only have one location to go by?
• Utilize the free services of your real estate broker to provide the demographic reporting
• Once you have multiple locations in operation (data points), then you can compare performance with location attributes and fine tune your site criteria
• Onboard your broker about the brand – make sure they share the enthusiasm of the brand's potential as they will be your #1 sales person when presenting the concept to potential landlords
• Spend a full day viewing all available locations in the "Market Tour". Take copious notes on the good as well as the bad locations
• Boil your options down to 3-5 locations
• Time kills all deals. You have to move FAST after your market tour and get the letters of intent out quickly.
• The franchisor should be very involved in the site selection process – don't sit on the sidelines
• Submitting a good letter of intent is the most important step in the whole landlord negotiation process – rent, term, tenant improvements, etc.
• If you don't get the Letter of Intent right, there is no way you will get the build out right, and if you don't get the build out right, you'll be behind schedule and way out of budget
• Once the letter of intent is delivered, the landlord is on notice to respond, however, that doesn't mean that you can stop looking.
• Always have backup sites in your pocket
• Use two LOIs to leverage the deals against each other.
• Once you reach the lease stage, the due diligence of the space continues – make sure that the space is exactly what the landlord advertised it to be. This is done with a site survey
• The drawings from the landlord aren't always accurate so don't rely on them
• It is best to utilize a national architect for every franchised location rather than local architects
• Floor plan design in a restaurant – the dining room is your money maker and should be maximized
• Familiarize yourself with the design review process – go down to the city offices and meet the people who will be doing the plan review
• Identify general contractor bid pool – qualify them – Have they built in the market you are in? – Do they have the relationships with the city officials, etc. Avoid too many GCs in the bid pool
• At the time of the build-out, the interests of the landlord are in line with yours because they get rent money once you open your doors for business, so they can be a good source of referrals of general contractors.
• Poorly planned design submitted to the city will stall the process
• Be aware of a TAP Fee – a fee by the city in order to tap into the utilities. This can be very expensive
• Ensure you have a plan to get your FF&E paid for and delivered on time according to the contractors timeline
• Qualify the bids by ensuring that everything in the bid is supposed to be there and nothing is there that isn't supposed to be there. Be sure to clarify who will be responsible for what activities and purchases. Make sure there is a clear matrix of responsibility.
• No hammer can swing until the building permit is issued
• There is no return on investment for the franchisee to be on site every day once hammers start swinging, rather, they should be focused on the bigger picture of doing the activities in preparation for the opening day such as hiring staff and marketing for the grand opening

Brendan Charles

Red C Business Advocacy

www.redcadvocacy.com

[email protected]

Phone - 303-333-3420

Kit Vinson

www.franman.net

[email protected]

214-736-3939 x 101

My Podner duo in this episode is Andy Erskine and Bob Gappa of Management 2000, and they're going to talk with us today about the importance of customer loyalty, what drives it, and how to manage it. This discussion will benefit both new and seasoned franchisors.

Today's episode will be unique. This will be the first time to have a returning podner with the GREAT, Mr. Bob Gappa. You may remember Bob Gappa from Episode #2 where we discussed the nature of the relationship between franchisor and franchisee.

Andy has been Bob's Protégé for 8 years now as he's been learning franchising from the master and taking Bob's accumulated knowledge and adding his own flavor to it.

Time Stamps

Andy Erskine Intro

00:00:29

Segment 1

00:02:36

Get to know Andy

Segment 2

00:11:20

Topic Segment – Creating Customer Loyalty

Segment 3

01:05:10

Quickdraw Questions

Topics Discussed in this Episode

What is customer loyalty?

• Transaction count is NOT the same as customer loyalty.
• Another term for disloyalty (brand adultery)
• Customer loyalty is tightly woven into Brand, which is made up of the emotion that you create with your customers

What makes customers loyal?

• Loyalty is built around emotions and emotions come from the customer experience
• The way that you interact with your customer (operating system) is what creates positive or negative emotions.
• Repeat customers are a result of your team members creating an emotional bond with the customer through the delivery of your product or service.
• Brand standards should focus on creating the emotions that make customers want to talk about their experience with their sphere of influence and go back.
• The Operations Manual is in place to create customer loyalty.
• To understand what creates positive or negative emotions in a customer, we need to understand the customer journey.
• The customer journey is literally every interaction that a potential customer has with you before, during, and after doing business with you
• Visible versus invisible standards – both affect the customer and loyalty. Invisible standards are those not customer facing, like ordering a sufficient amount of material to deliver the product.
• The issue with system standards is that there isn't enough forceful compliance when they aren't being followed and there isn't enough positive reinforcement when they are, and so they don't seem important to either the franchisee or franchisor.
• Brand icons are as important to customer loyalty as brand standards. Brand icons are the aspects of your business that you are absolutely known for.
• Emptions are what create the brand rather than a well-known company.

How do you measure customer loyalty?

• Technology is how to track customer loyalty through cell phones and credit card transactions
• Knowledge is power. Know your customers behavior data and use that to create the emotional connection in them to make them loyal.
• By understanding what customers value, we can create customer loyalty
• Prism will segment your credit card transactions into demographics and behaviors

What do you do with customer loyalty data after you get it?

• Data helps you refine your message to your real customers – understanding what they value so you can deliver the value that they want, which in turn creates loyalty
• Don't confuse frequency due to convenience with loyalty.

What should I be doing today as it relates to customer loyalty?

• Start enhancing what it is that the customer values by understanding who the customer is.
• Stop thinking of yourself as a franchisor and start thinking about yourself as a steward of a brand.
• Stop having a franchisee advisory council and start having a brand advisory council
• Answer three critical questions. Know who your customers are. Know what they value. Know how to enhance what they value.
• Know how to make their experience personal.
• Help the customer make a connection to your brand
• Select employees, don't simply hire them.
• Focus on how to create a great place to work
• Team members should know that their job is to create an experience that makes the customer want to come back
• Training a team member is usually only focused on the activity, which is simply skills, knowledge, and abilities. In addition to that, you should focus on developing people's understanding and emotional commitment to the purpose of their job, which is to get the customer to want to come back.

Andy Erskine

Management 2000

www.mgmt2000.com

[email protected]

Phone - 800-847-5763

Kit Vinson

www.franman.net

[email protected]

214-736-3939 x 101

Books Mentioned in the Episode:

Love Marks

By Kevin Roberts

The Effective Executive

By Peter Drucker

Emotionomics

By Dan Hill

Retail is Theater