How to Build Franchisees for Scale

21st Dec 2011
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By DivyeshKharadeAfter we raised our first round of funds and in the struggle to recruit quality resources, I instantly thought about connecting to my friend Shubham Rai who runs an HR consultancy called Think People Cumulus. Shubham started on his entrepreneurial journey when he was 19 and has been on a roller coaster ride ever since. Shubham to his name has the distinction of innovating with a franchisee model in this space and already has 62 franchisees across India and growing.

I thought of picking his brains and understand the franchisee part of the story to scale since I have no previous experience of it. The following pointers sum up the things one cannot ignore while building a franchisee network:

Chicken and Egg situation: Building franchisees and converting clients is always a chicken and egg situation, but according to Shubham having marquee names and repeat customers is quite important before you start making plans of going the franchisee way.

Get your branding right: While deciding your branding strategy from the start, concentrate on branding from franchisee point of view as well as customer point of view if you know that franchisee is the model to scale in the future.

Assure business: Building franchisees is like building entrepreneurs with mutual benefits. If operations are their headache then generating business is yours, after-all even franchisees need to have a sound cash flow.

Cover downtimes: One of the many important questions a franchisee owner will ask you is: what happens during recession or downtimes. Though it can’t be avoided the way Shubham handles it is providing a variety of services/products. (in his case sourcing candidates across domains, in case a particular industry is not performing well) Easier said than done, this aspect needs to be well thought of.

Mentoring and problem solving: Even franchise owners and their teams need mentoring; can be for building businesses, operating efficiently (even if it’s their headache) or training. Consider all their problems as yours and address each of them.

Technology and Training: Try and introduce technology or apps to operate smoothly and engage effectively with all of them, it not only helps you save money while scaling up but also helps building a brand which your franchisee owners love and gives them a sense of belonging. Shubham also uses DRONA to train and engage his franchisees which he thinks are an important aspect to increase satisfaction levels.

Growth and Credibility: Have a growth plan charted out which needs to be communicated to each franchisee with a regular review and feedback for both to improve. Also focus a lot on the credibility of the brand as well as the promoters. Credibility building also means sticking to payment schedules even if there is a delay in payments by customers and sticking to commitments.

On a parting note, a franchisee model is not only about converting your cost centers into profit centers but also about finding the right win-win situation where even the franchisees stick long term, after all they are an asset to your company!

Read Divyesh’s articles regularly on YourStory.in

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