Franchising Supports Small Business Saturday

Small Business SaturdayYes, progress is being made and franchising is being recognized more and more by American Express in their Small Business Saturday efforts. When launched in 2010, franchises were not included in Small Business Saturday, being excluded with a specific clause in Small Business Saturday literature to merchants interested in participating in the new program. I was definitely surprised and although we still have a way to go I’m happy to say the past two years have seen franchises included in the list participating businesses. And that is great!

When I first realized franchising had been excluded I was quite surprised. Sure, as many are aware, I did flood the social media space with several blog posts about franchising being excluded. No need to regurgitate that any further and I’m not including links to those posts here as American Express did respond, and in a very positive way. They truly wanted to learn more about franchising and its role in small business today and I was more than willing to help. You see, despite the role American Express plays in business today and despite the fact that AMEX executives are very well-educated and understand business, they had huge misperceptions about franchising. Several of the AMEX executives I met with actually thought all franchises were just like McDonald’s – big and powerful! They also incorrectly thought McDonald’s and other [large] franchisors paid for all advertising on behalf of its franchisees. Thus, they excluded franchising, thinking all along that all franchisees had it made in the shade over independent small business owners.

Well, I was happy to share many statistics about franchising and the fact that many franchisees are the same Mom & Pop operators that built their businesses on Main Street USA. Just like many independent small business owners, they have invested their life savings in pursuit of the American Dream. And just like small business owners everywhere, they continue to fight off big box retailers and department stores alike for a slice of every dollars expended by today’s consumer.

Fortunately, American Express listened, and I was quite impressed. Unfortunately, and to my dismay things did not move along as quickly as I would have liked and although progress was made and franchising was included, but limited in the subsequent years since 2010, I was extremely anxious and wanted full inclusion for franchising, and I wanted it now! What I was missing and fully realize now, thanks in part to Tom Epstein, CEO at Franchise Payments Network, is that American Express, albeit a huge organization has a difficult time making abrupt changes to programs as there are many considerations… many financial ones that I had not even considered such as the sheer cost of marketing materials, just to name one of many.

In any event, I was excited to see Tom contribute to the effort of getting franchising more involved in Small Business Saturday. He has spent a great deal of time learning as much as he could from his various contacts at American Express. I believe the efforts are paying off and will continue to do so year after year. Others within the franchise community, including the International Franchise Association have contributed as well, and I applaud their efforts. Speaking of the IFA, I’d like to take this opportunity to thank them for all they do in promoting franchising as without those ongoing efforts we’d truly be dead in the water. You see, just as American Express promotes “Membership has its Privileges” so, does membership in the IFA.

So, on this Small Business Saturday, let’s pull out those AMEX cards, whether they be green, gold, platinum, blue, plum or black and spend away at small businesses across our great nation. Happy shopping!

Franchise brands are few and far between on list of top brands in customer service!

Despite repeatedly hearing that exceptional customer service is paramount in today’s economic environment, franchising sees few brands make the list of top brands in customer service.

Do you believe it’s possible for a franchise brand to consistently deliver positively memorable customer service along the likes of Apple and Amazon.com, just to name a few of the brands that are repeatedly mentioned when discussing exceptional customer service and customer experience?

Are franchisors dedicating enough resources on customer service training? Are franchisees focused enough on providing exceptional customer service?

Personally, I believe it all starts with the culture of the Franchisor and the same must be conveyed to franchisees, not only through training, but in the way franchisors treat franchisees. It must be a top-down effect to start the process and must be on the forefront of everyone’s mind at all times and at all levels of the franchise organization. I also believe an extremely high level of providing positively memorable customer experiences is a key component towards improved unit-economics, and also in helping increase interest in franchise opportunities.

50 Brands Named ‘Customer Service Champions’ as posted on MediaPost.com March 15, 2012

In the faltering economy, the importance of customer service has reached new highs, overtaking even price as a purchase determinant, according to a J.D. Power report.

Read the complete article.

Want to learn more about customer service in franchising?

Mindy Golde, Director of Sales at Listen360 (formerly Systino) discusses Consumer Sales and Customer Experience at the upcoming Franchisee Sales & Marketing Summit. Listen to what she has to say about franchise brands and customer service! FranSummit is March 26-29.

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Would the World be a Better Place Without Franchising?

This article is a repost from March 15, 2009

It is unfortunate the franchise industry continues to be (and always will be) subjected to bad press because of franchisee failures resulting in lost family savings including the children’s college fund. It’s unfortunate because bad press sells and society has evolved into accident watchers. Need I say “rubber necking on the highway?”

Not to mention that society has become full of gossipers. When was the last time you heard someone in the neighborhood say “Did you know Joe and Mary have been married for thirty happy years?” Such a positive comment is usually left unspoken, at best. Instead, you would be more likely to hear, “Did you know that Joe cheated on Mary.” Well, I think you see the point.

Would it be better for the press to report franchisee failure due to the franchisee not following the system, being undercapitalized or because of serious substance abuse problems? I seriously doubt it. But wouldn’t that at least educate the public? The same public that is looking at franchising as a career alternative or their first step into entrepreneurship. I know, that’s never going to happen either but it would shed a light on the truth.

I haven’t even touched upon less than reputable franchisors, undercapitalized franchise concepts and poor lending practices. Regardless, of how much government tries to protect potential franchise candidates, the government and the industry itself cannot effectively police every franchise professional, every franchise company and every aspect of commercial lending. It’s just not feasible and possible.

What’s the Solution?

So, the ultimate answer lies in dedicating more time and resources in positively publicizing franchise concepts and the industry itself. As well, promoting efforts and results in working with community and non-profit groups would go a long way towards positive public sentiment.

Basically, we (reputable franchisors, franchise professionals and the industry as a whole), need to create a publicity bank that can be withdrawn from as a precaution and hedge against the potential and reality of negative publicity. And just like the cash reserves insurance companies are required to have on hand for future claims, multiple sources and instances of positive publicity must be accumulated to counter the few negative counts of publicity that the media so enthusiastically reports.

The world would not be a better place without franchising. We just need to inform and remind people of the industry’s efforts and accomplishments so the world knows how franchising has actually made the world a better place and will continue to do so for years to come.

The challenge is that in today’s uncertain economic environment, where franchisors continue to cut budgets, the possibility of dedicating more resources towards positive publicity is slim to none. Certainly, it won’t be done in the traditional sense.

But it can be achieved, as it can also be achieved for marketing, development and operations, by exploring non-traditional strategies, methods and processes which are essential to future franchise growth and success.. at all levels.

Franchise Community – This Needs Our Immediate Attention!

Avoid-texting-while-drivingEvery once in a while, we come across something that makes such an impact on us that we find ourselves motivated to let other people know about our find. Well, I found one of those things. Except, it is not something that I’ve enjoyed, laughed at, or wanted to share for pleasure’s sake. However, it is something that everyone, I mean EVERYONE must be aware of. It’s something that everyone must share and spread the word about. That is, if you care about saving human lives and protecting families from absolute devastation.

The other day I was watching Rick Sanchez on CNN as they showed a Public Service Announcement video that depicted a horrendous accident which was the result of “texting and driving.” After watching this eye-opening four and half minute video, I was speechless, but knew I had to help spread the message of no texting (or emailing, tweeting, posting, etc.) and driving.

One of my social media clients, Mom Corps, happens to follow, and be followed by, @DontTwive. I had seen their posts and even before watching the PSA video, I was intrigued by their efforts. We tweeted a few things about DontTwive and retweeted some of their posts as well. But, after seeing the video, I knew I had to do more.

Today, I posted, from me, and from Mom Corps, tweets on Rick Sanchez show on CNN. Our messages ran across the screen many times during the show. Posts were also made on my personal twitter account, and that of Mom Corps. I also posted a link to the DontTwive blog on my Facebook page. But I know it’s not enough. Not even scratching the surface, but I know every little bit helps when it comes to saving lives and protecting families.

So, in an effort to take this to a new level, I invite all our site visitors to read the following blog article from DontTwive, and view the accompanying video. In addition, I implore all to please preview the rest of their site because it has a wealth of information and other articles pertaining to this horrific subject.

Upon doing so, please join me in supporting DontTwive and their efforts by sharing this information with all your friends and family, and with all your social networking connections. Also, please follow DontTwive on Twitter and make sure to tell everyone who will listen to do the same. On my end, I will look for additional ways of helping, so stay tuned for more details.

4 Minutes and 15 Seconds that can save your life

This 4:15 PSA video from the Wales Police Department is graphic and intense but left us speechless with its message. Some say this video is too gruesome and YouTube has even blocked the 18 and under group from being able to view (the target audience for this Public Service Announcement.)

Read the complete article and watch the video HERE!

This video should be watched by any driver who thinks they can text and drive. Life can change in one second. One second – less time than it takes to Tweet, text, email, or dial a phone number.

Talking PR, Franchising & Social Media with Arment Dietrich CEO, Gini Dietrich

PR Adapt or DieAs we do quite often, Gini Dietrich, CEO at Arment Dietrich PR, and I, communicate on Twitter, on Facebook, by email and by phone, about a multitude of things, both business and personal. Sure, we banter and kid a great deal along the way. But when the discussion turns to franchising, communications and social media, the kidding quickly subsides, and the conversation turns serious. Okay, not completely serious, because we’re both smart-asses. But serious to the point that we’re anxious to share our ideas with each other, and determine ways to share them with our franchise clients and the franchise community.

Recently, I turned one of our discussions into an informal interview, and asked Gini to share some of her thoughts, so I could share the same with the franchisEssentials readers. Always being shy and not wanting to be in the limelight (yeah, right!), Gini fired off her responses without hesitation, further demonstrating her passion, and conviction in her thoughts. I just loved her response when asked about the future of public relations, as we know it today. Well, decide for yourself as you read some of the Q & A below.

Paul: “How important is a communications strategy to franchise organizations today?”

Gini: “It’s not at all important. Ha! Just kidding. To use one of my favorite quotes by NPS senior news analyst Daniel Schorr, “If you don’t exist in the media, for all practical purposes, you don’t exist.” But in today’s age of digital technology, it’s not just the traditional media strategy that a franchise needs to have. I love the case study of the companies that made it through the Great Depression. Know what they all had in common? They didn’t cut their communication. In fact, they increased it. And the companies that did that then are still around today while their competitors, who cut their communication budgets, went out of business. Like Daniel Schorr says, if you’re not communicating, how will your customers know you exist now and into the future?”

Paul: “Is it important for local franchisees to have a communications strategy in place or is it sufficient to only have it at the franchisor level?”

Gini: “I’m a HUGE proponent of local franchisees having a strategy in place that is complementary to what the franchisor is doing. Consider most reporters won’t cover your business unless there is a local angle. Most local baseball teams are sponsored by local businesses. The Mayor won’t show up to your ribbon cutting if you’re not giving back to the community. Add into the mix social media and you know that people buy from people and want to have a relationship with the people they do business with…not the company or the brand. The person who buys your product or service in his/her community, wants to have a relationship with the person running that entity, not the corporate monster.”

Paul: “Is public relations, as we have known it over the years, changing to adapt to a more “connected” society?”

Gini: “There has been a lot of discussion about whether or not public relations, as an industry, is dying. Most PR people (as evidenced by a recent IABC poll) deny it’s happening and are content with doing their jobs as they’ve always known them. I contend social media is changing the way we communicate and PR, as we know it, is dying. Regardless of PR professionals thinking social media affects the way they do their jobs, someone has to own it – be it marketing, PR, or advertising. I’d rather jump on it now and own it. After all, social media is about developing and fostering relationships with customers, stakeholders, employees, influencers, and individuals. Traditional PR is about developing and fostering relationships with media and influencers. Makes sense to me that it fit in with PR.”

Paul: “What role do you see social media playing within the franchise community?”

Gini: “I love, love, love what Tasti D-Lite is doing with social media. I use this example all the time. They have a store in the Empire State Building. Whenever someone tweets that they are in or near the Empire State Building, @tastidlite sends them an offer to come into the store. In some cases, they offer a free frozen dessert. In others, a discount. This has helped them build in-store profitability, loyal customers, and their intensely passionate following. This is SO EASY to do at the franchisee level. This is just one example of how social media helps build a franchisee following. Get out there and try it. It works!”

CEOs and Social Media

Today, Gini Dietrich, CEO at Arment Dietrich PR presented an interesting question on the company blog, F.A.D.S. (the Fight Against Destructive Spin), “Should CEOs Spend Time On Social Networking?” Of course, always having to add my two cents, I responded accordingly.

CEO“I would be surprised if any CEO of a publicly-traded company had a social media presence. The reason I say this is because of the SEC and FTC.

The SEC has certain rules about information being presented and disclosed to the public and the CEO would need to be extremely careful as to what he or she communicates, even through his or her own personal social networking efforts. From a liability standpoint, I’m not sure the benefits outweigh the potential downside.

With respect to the FTC, the issue here is the marketing message and how it can and may be perceived. Currently, the FTC is considering guidelines and rules about marketing messages being conveyed through social media. Again, as the leader of a public company, the CEO must tread carefully and, even in conveying a marketing message, must be very careful not to break any SEC rules. Again, the benefits need to be weighed against potential consequences.

All that being said, I stongly believe public companies should have a major presence in social media, including social networking, letting the marketing experts spearhead the activity and content. While doing so, I do believe the CEO could, and should, participate strategically with key, well-defined content, more to enhance the overall effort as opposed to being front and center.

Now the flipside, private companies. I do believe CEOs of private companies need to be as transparent as possible. They’re usually the vision and drive behind the company. His or her thoughts and statements lend a great deal of credibility to the company, which ultimately may be defining factors in a customer, client, vendor or partner doing business with the company.

Often, the CEO, “is” the company which why we see companies named after the Founder and CEO. Many times, the CEO is actually the “commodity” being sold by the company. This is especially true with professional organizations, consulting companies, etc.

Service and product driven companies are different as there are usually consumers or clients as end-users. As such, they rely on the “personal guarantees” of the CEO and that message usually needs to be promoted to drive business. I’m thinking along the lines of George Zimmer, CEO of Men’s Wearhouse.

When it’s all said and done, there are few, more efficient ways of promoting a business, large or small, than through social media, and social networking. The messages are concise and clear, and often present the human side of the business. And, clients and customers alike, feel more confident “knowing” the CEO and his or her thoughts, feeling more comfortable with their decision to do business with the company or organization.

Here’s a simple, yet totally unscientific rule of thumb: If a business needs to have the CEO’s personal guarantee on loans and lines of credit, then the CEO should be very active in social media and social networking activities. If the company can enter into loan and credit agreements without any personal guarantees, it’s best to leave the social media and social networking efforts to the marketing experts.”

Please note: CEOs of franchise organizations also need to be careful not to present inadvertent earnings claims in any social media activities.

Transitioning Interested Parties to Franchise Candidates

In continuing your journey of Franchise Development via Social Media, it’s important I point out that social media for typical business to business (B2B) or business to consumer (B2C) purposes is much different than social media for franchise development purposes. In a typical B2B or B2C scenario, social media efforts would be directed to the entity or individual you’re attempting to do business with. Your business with them may be a single transaction, or as with restaurants, it may include repeat business where you’re seeking customer loyalty. Regardless, your position is strictly focused on attracting and keeping your customer, and the transactions are usually relative to a specific, tangible product or service. They buy. You sell. And the cycle continues the same or it abruptly ends.

intangibleIn the franchise development arena, your social media efforts will be considerably different as your objective is different. The franchise sales transaction consists of a substantial upfront fee for an intangible item, franchise rights. The transaction is only the beginning of the additional cash outlay or credit commitment, that’s triggered by the initial fee and signing of the franchise documents. Yet, the relationship is not one that’s just based upon that one single transactional experience. Instead, it’s only a small step in an ongoing relationship where the new franchisee becomes dependent upon the franchisor and the concept. Buyer’s remorse is not an option. The social media efforts must progress and build upon each other with the objectives gradually changing and progressing “as” the relationship builds, and not just “because” the relationship builds.

Yesterday, we discussed establishing the Virtual Party Room. Today, we’ll discuss how to interact with the individuals within the room and with the new people we’re introducing to the party. Our objective will be to learn, through utilization of powerful Web 2.0 technology and tools, how we can transition interested parties into franchise candidates by just “holding their hands” and letting the experience guide them along until they’re ready to make a decision. Easier said than done? Well, it’s not rocket science, but I’ll still try to be as fundamental as possible in my explanations.

Transitioning Interested Parties to Franchise Candidates

When the interested party enters the Virtual Party Room, he or she is basically just tire-kicking. Oh, they may have expressed significant interest in your concept, or maybe they’re just inquisitive. It really doesn’t matter at this point. Your objective was to introduce the individual to the party. That’s it. It wasn’t to push them immediately towards the franchise sale. It’s wasn’t about discussing the fine points of the franchise concept. It certainly wasn’t about closing the deal. Your only objective at this point was to introduce the individual to the party so he or she could learn more, interact with others in the party and gather enough information to make an informed decision at their own pace. Remember, social media is not about selling!

hostessAs with any popular party, it’s important to have a host or hostess. In your party room, this person is essentially in charge of accepting member requests, posting new information, updating various features and keeping the “conversations” flowing. I think you now fully understand the party analogy so let’s transition to reality and make reference to specifics with respect to your franchise concept.

The host or hostess is the person you install as being in charge of your social media efforts. This person is key to making your social media efforts a success or failure as this individual must be on their “A” game. They must pay attention to detail and exhibit a sense of urgency when necessary. Starting at the very beginning, this individual will set up the company page in a specific social network. I highly recommend utilizing Facebook, but it can work in other social newtorks as well.

In Facebook there are general, basic information sections that need to be completed. Once completed, you’ll need to start building your site with information about your franchise concept. Videos, a strong Web 2.0 tool, work extremely well in conveying messages to individuals interested in your concept. The founder’s statements about vision and passion for the concept goes a long way towards generating excitement. A few video testimonials from franchisees, placed strategically within the site, provide a balance between the concept as a franchise opportunity and the concept as a consumer experience.

Photos, placed throughout the site along with comments, are a great visual affect as well. These photos may be of franchise locations, the equipment used in daily operations, the original locations from which the concept was derived, the founder, personnel, the product or service sold at the franchise locations, etc. All should include comments with each post explaining the photo. Additional comments from other group members will enhance the experience behind the photos.

A media section should be established to include press releases, audios and videos of important speeches, photos of company spokespersons, online and print news and feature stories, highlights of community events, etc. Comments about each must accompany the posts. Again, additional comments will further enhance the experience.

All individuals having anything at all to do with the franchise concept should be invited to join and participate in the group. These should include company executives, managers and personnel at all levels, franchisees and their personnel, franchise customers, company vendors and suppliers, and all interested parties in the franchise concept. In place, and participating, this group creates the buzz and excitement of the group.

Now, when individuals that have expressed interest in your franchise concept join the group, they may interact with group members, asking questions and seeking information. They’ll start to “experience” the concept from all angles as if they were at the franchise locations or within the corporate office. At any time they can jump into the conversations and add their own comments. Sometimes in the forms of questions and as they get more comfortable within the group, as their own personal comments and views.

Over a short period of time, and through monitoring the group’s activities, it’s relatively easy to “see” which individuals are interested in becoming franchisees of the system. Their questions and comments will dictate their interest. This is where the individual in charge of the social media efforts increases their interaction with the interested parties and provides even more information that moves them along in the process. This is usally done through site messages, or responses or comments to their comments. Ideally, the best way is a timely instant message as provided on the Facebook page.

The system basically moves itself up to a point. From there it needs to be guided and ultimately directed towards the latter stages of the franchise sale. Now, don’t get me wrong, an email or phone call throughout the process helps, but only as a guide or reference to a real person. Another Web 2.0 tool that works great in this regard is a video email (vidmail) program that brings a real person right to their desktop. It’s both a professional and effective use of Web 2.0 technology.

Okay, the site is up and running, you have interested parties joining the group, they’re interacting within the group and all is going according to plan. What next? Certainly there’s more to this social media thing, isn’t there? Yes there is. Ever hear about Twitter? Do blogs sound familiar? How about You Tube and Flickr? Ah, now we’re getting somewhere.

twitter-logoOn Twitter you’ll post frequent bits and pieces of information about franchising and entrepreneurship in general and along with a few “personal” tweets, yes they call them tweets, you’ll post links to various parts of your concept including the Facebook group page, your website which will have a link to your Facebook page and to your blog, which will also have links back to your Facebook page. So you see, all activity will ultimately be directed back to your concept’s Facebook page because that’s where you can monitor and control the flow of information and interest because it’s interactive. There, that answers the question of why shouldn’t everything be directed to the website? Let me clarify. Facebook is interactive. Websites are not.

Remember the videos you developed for the Facebook page and the photos you posted to the Facebook page? Well, you’re now going to post the videos on You Tube and the photos on Flickr. Each post will have a desciption, and guess what, a link back to your Facebook page! This way, you’ll be able to direct individuals from your Twitter and Blog to these sites as a redirection to your group page or you may be able to generate interest in your concept by individuals exploring these other Web 2.0 sites. Keep in mind, I’m only scratching the surface on the different Web 2.0 sites as there are hundreds. Using as many as possible in cross-referencing and click-throughs will enhance your efforts many times over. By the way, it won’t hurt your search engine optimization either.

Additionally, you will take your Facebook group identity and join other Facebook groups where individuals with interests in franchising, entrepreneurship, specific business type and that may have the criteria of your ideal franchise candidate, congregate and share information. During the course of discussion and sharing of information, it’s relatively easy to guide these individuals to your Facebook group page and the cycle begins on your “turf” with them. The same holds true with LinkedIn groups, Twitter groups and other social network groups.

As you can see, the limits of social media are endless and are only limited by discouraging imagination, holding back creativity and not dedicating ample time to administer, execute and monitor the process. The potential benefits are far reaching throughout the organization including creating brand awareness with franchise candidates and consumers alike, generating qualified franchise leads and subsequent franchise sales, and establishing an interactive environment of communications and information sharing at all levels of a franchise organization.

In tomorrow’s third segment of Franchise Development via Social Media, we’ll discuss how to integrate social media with traditional franchise marketing and development strategies, and some non-traditional strategies as well. In the meantime, please submit any and all questions below, and I will respond accordingly prior to posting the next series segment.

Customer Service and the Ripple Effect in a Franchise Organization

Here’s a story that was told to me a couple of months ago. I posted it on one of my other blogs, 21st Century Franchise Coach, but recently thought about how such an experience ultimately affects the franchise brand. So, franchisors, and anyone else that wants to chime in, when you’re reading this article, please keep the following questions in mind:

really-bad-customer-serviceHow would you handle this situation if you became aware of it through a customer complaint?
If asked by a franchisee, about what to do in a situation like this, or how to avoid it completely, how would you respond?
Are situations like this, covered in initial and ongoing franchisee training?
Ultimately, if similar situations are repeated, how could it affect the franchisors’ bottom line?
Do we, as a franchise organization, go the extra mile in working and communicating with our franchisees, who are basically the organization’s customers?

One Lost Customer Could Cost Thousands

I immediately thought about a question that was posted on a social network discussion board about what companies were prepared to do in order to retain customers during the current economic crisis.

Late one morning, a client of mine was told by his boss to purchase gift cards to be given as prizes for that afternoon’s golf tournament. The company had decided to increase the number of prizes as the response to participate by local businesses was overwhelming. The tournament was to start at 12:30PM and my client was playing in the event and had several of his clients playing with him. Therefore, it was imperative he make it to the golf course by noon at the latest.

At 10:35AM he went to a national chain restaurant and found it closed but saw alot of activity inside by the front desk. He knocked on the door and explained his desire to purchase $1000 in gift cards. He was rudely told the restaurant didn’t open until 11:00AM. My client explained his circumstances and the need to get across town to the golf course and not having to wait 25 minutes would really help him. He asked to speak with a manager. He was emphatically told no.

Instead of waiting, my client went across the street to another national restaurant chain location and found it didn’t open until 11AM as well. However, as he was looking in, a cook noticed him and opened the door. The cook cleaned his hands and helped one of the girls in the restaurant dig out enough gift cards to make up the desired amount and complete the transaction.

Okay. Here’s a few things to consider. My client frequently takes clients out for lunch. Do you think he’ll frequent the first restaurant in the future? The gift cards were given to ten participants at the golf tournament. Do you think they may spend above the gift card amount when they redeem the cards? And, is there a possibility their experience at the restaurant may be their first to the restaurant and if they enjoy the experience, they may return? How many people will my client tell about his bad experience at the first restaurant and how many people will he tell about the second one?

By not acting “outside the box”, how much revenue will the first restaurant potentially lose over the course of a year? Thousands?

Changing Sign From Franchise to Independent and the “After-Effect”

blank-sign“What is the effect on a business if you take down the brand name sign and put up an unknown brand?”, was a recent question for discussion in a couple of the LinkedIn franchise groups. The question turned into a good discussion as there were over fifteen responses but I was surprised there was minimal reference to legal obligations and potential ramifications under the franchise agreement. Below, please find a few of the comments submitted, including my own. As we have done in the past, the names of the responders will only be identified as their LinkedIn description and their names will not be included in this forum. Upon reading the comments please free to include your own at the end of this article.

Award Winning Franchise Sales Specialist and Business Consultant said: That is a very good question. This is purely antedotal experience but what I have noticed in two industries;

Hotels- Drop-off is immediate. However, only about 10% of the revenue typically comes from the sign itself. It is the lack of a global reservation system that has the greatest effect.

Real Estate Companies- Slower but I typically saw a decline of revenues of up to 50% over a much longer period. ie. 5-7 years. Was this because of the sign or lack of tools and systems that the brand provided.

As a zee and a zor I would never sell nor buy a brand merely on the benefits of the sign. It’s the tools, systems, and experience that the brand provides that is of most vaule to small business owners.

CEO/Founder & Managing Partner of a franchise consulting firm chimed in: The question is too broad to to have a strong singular answer.

A McDonald’s owner (just using an analogy for comparative purposes) with a six of seven figure marketing budget and with an organization that has a 55+ year history, deeply embedded in the American culture would be committing commerce suicide.

However, I have been a part of a franchise where a number of the franchisee’s left the system in a service business; having established their capability, customer service commitment and frankly a strong book of business. Still they lost sleep, hair and either gained or lost weight before having made the decision.

How much of who you are is about you, your service, your relationships, your ongoing knowledge and the trust you have developed compared to the value brought by the company branding?

Secondly, taking the sign down only one part of the thought process. You may or may not value the marketing or positioning that the franchise has established but are you gong to be able to replicate it? Are you also going to have the time and the competency to evaluate both the future of the service, its technology and it’s market while continuing as it’s operator? Do you have the professionalism, time and organization to replace the things that the franchise should be providing?

Things that make you go hmmm…or, if they don’t, they should.

Founder, Owner and President of a franchise consulting firm added: I think the best example I can provide has to do with a brand that has been with my family for 4 generations now, Dairy Queen. Most of us have seen the iconic mansard red roofs of Dairy Queen and the image box out front. Some have seen these businesses close down and become all kinds of businesses. In fact just within a few hours drive of my house these former DQ’s once serving those glorious soft serve treats are now Taco stands, Cuban sandwich shops, nail salons, and I even saw one that was a puppy store.

Not good for the brand indeed.

As a DQ franchisee, I can tell you that when this type of thing occurrs it definately DOES impact the neighboring franchisees who remain in the brand. Without question it forces consumer to question the concept. They question everything from the strength of the brand, the tastiness of the food (in this example), and even the cleanliness of the other stores.

In my opinion it is ESSENTIAL for brands to completely demark so that every traceable sign of the former brand is extinguished. Franchisors who get lazy about this hurt their concept.

Of course, I participated in the discussion and added my views accordingly: Let’s not forget the resale value as a franchised brand as opposed to selling the business as an independent and all that goes along with it including attracting more potential buyers, proven business sytem, training, support for the new franchisee, advertising commitments, etc.

All go a long way especially if having to carry some paper is the only way to make the deal happen. Which might very well be the case in today’s economic environment.

Certainly the seller would feel more comfortable financing part of the deal if the business was still a franchise as he knows there are systems to follow and reporting to home office that will somewhat keep the business in line. As an independent, there’s no telling what direction the new owner would take and for how long. What condition would the business then be in if the business needed to be repossessed and operated again by the previous seller?

…It’s just flat out suicide!

I also added the following statement: Personally, the chance of total failure would be far greater as an independent. If the decision is made to take down the franchise sign, then why not solicit franchisor’s assistance to sell the business and then use the proceeds to open as an indpendent. If necessary, negotiate with the franchisor to waive non-compete, etc.

Quite frankly, I believe no one would take this route because they probably feel it’s just easier to operate the current business as an independent because the business is already up and running. In the end, most decisions to de-identify is a matter of not wanting to pay royalties. So, I say, live up to the franchise agreement and if so desired, exit with dignity and your reputation in tact.

An interesting note: The large majority of responses were submitted by franchise consultants. Although most of the consultants were former franchise company executives or franchisees. Only a couple of responses, and brief ones at that, were from current franchise company executives. As stated above, it’s another one of those things that make you go hmmm…or, if they don’t, they should.

Media Can Make or Break a Franchise

The following is an informative article submitted by Guest Author, Gini Dietrich, Chief Executive Officer at Arment Dietrich PR. The article focuses on building relationships with the media and provides tips for communicating and interviewing with reporters. Gini fully understands franchisors’ public relations and communications needs and will be speaking at the upcoming Franchise Finance and Development Conference in Las Vegas. Recently, while participating in the International Franchise Association Convention in San Diego, Gini was interviewed on The Franchise Show, where she discussed communication tactics using social media to develop new business and networks for company growth. Arment Dietrich PR is among the country’s fastest growing boutique public relations agencies. Their motivation is a relentless drive to find new and better ways to help clients boost their businesses and bottom-line results.

Media Can Make or Break a Franchise

I have people say to me all the time, “any ink is good ink, right?”

Wrong! Please see AIG, Merrill Lynch, any of the automakers…pretty much any Wall Street company in the past year. Any ink is NOT good ink. You must think strategically through which media outlets make most sense for your franchise, build relationships with those reporters, and provide them with content, interviews, and access to executives they couldn’t otherwise get on their own.

media-interview21Media can make or break your franchise and it’s VERY important you treat every reporter you come in contact with as if they are your most important VIP, regardless of how you feel about their past or current reporting.

Paul asked me to think about some tips for helping you with your communication needs. These are some of the tips we give to our clients when we train them on how to work with, talk to, and respond to reporters.

• If a reporter calls, wanting to interview you for a story, ask them what they’d like to discuss and what their deadline is; then promise to get back to them in less than 24 hours or in enough time to meet their deadline.
• Call your PR firm for a quick key message refresher. If you don’t have a PR firm, think about what you want the story to say about your franchise after it’s told and write down two or three things you don’t want to forget to tell the reporter.
• If the reporter submitted questions (we always ask for questions in advance), write down your answers. I do this and I have years and years of experience, working with reporters every day. Don’t ever go into an interview blind.

A few interview tips that can help in any situation:

• Be honest—A lie to the media can be very damaging. If you don’t know, say so.
• Be believable—Credibility is vital to getting your message across.
• Be personal. Use the interviewer’s name once or twice in the course of the interview and look at him/her.
• Anecdotes play well, but only if you have a story that makes a good point for your side.
• Be concise—Remember that a 10-minute interview may wind up being 20 seconds on the air or three lines in a newspaper. It is essential to crystallize your thoughts in a few hard-hitting sentences.
• Eliminate extraneous words and phrases. Do not be verbose. If a reporter is silent, do not keep talking. They likely are trying to write down what you just said. Let them do that before they ask the next question.
• Do not answer hypothetical questions.

And, above all, NEVER, EVER SAY NO COMMENT! If I hear from Paul that you were quoted as saying “no comment” or that you were “unavailable to comment,” I will come to your office and yell at you myself.

What media interview tips do you have that can help readers here?