How many leads are generally needed to award a franchise?
On one of the last BFA online events I (Phil Mowat from Ashtons Franchise Consulting) attended, the conversation turned to franchise recruitment and how many leads are generally needed to award a franchise.
As it has been for almost a decade now, the answer coming back from many franchisors was: 100 – yes one hundred leads are generally needed to award a franchise! Houston, “do” we have a problem?
In my years of coaching business owners, I often talked to them about their “conversion rate”. Many would boast that theirs was “somewhere around 70% or 80%” – but in truth, when we started really tracking it properly, that rate fell dramatically. If a business was converting around 4 in 10 leads, then this would be around average for my clients (obviously this % is highly dependent on the sector and what the business is selling, but to make some comparison we need averages!)
So, 1 in 100 – a 1% conversion rate, in my humble opinion, yes, we do have a problem.
I’m sure we as an industry can improve on this!
We don’t need to accept this as a norm, just because that’s the way it’s always been.
Here’s my top 5 tips for improving your conversion rate:
- Target the right people, in the right places, in the first place.
Create (and adapt over time) your perfect franchisee profile and ensure you are advertising in the places they “hangout”. You are in the business of awarding franchises, and the #1 rule of marketing is knowing who your target market is. Ensure you spend time on getting this vital first step as right as it can be.
- Be authentic and personal, build rapport quickly and offer 100% transparency.
This will help to build trust with the potential franchisee. Take them out for lunch, get to know them, give them an opportunity to show you the real them, and likewise, show them the real you. It’s often said that the franchisor / franchisee relationship is like a marriage. Fall in love first!
“People buy from people”
- Be organised and K.I.S.S.
Having a well laid out step-by-step (flexible!) process that you and the potential franchisee will go through, means all parties know exactly where they are up to at each given point. This should give them the right information at the right time, i.e., not too much in terms of quantity and detail at the start, but drip feed it through to them at each stage that they gain more of an understanding of the opportunity.
Look at each stage of your process and work out where people are dropping out and why?
Then to improve, K.I.S.S. = Keep It Simple, Stupid!
An example would be putting your Confidentiality Agreement and Expression of Interest / Application Form online, so they can simply click a link and then complete these important documents on their phone by filling in the boxes. This takes away the hassle of them having to print, handwrite the answers, scan and then email them back to you.
Quite simply this means: Do What You Say You Would Do.
If you say you will email a Prospectus over this afternoon – make sure you email it over this afternoon. There’s nothing more frustrating that being on the receiving end of expecting to get something and then having to chase for it.
- Don’t go it alone.
Involve as many of your internal team as possible, as well as your franchisees. Your franchisees are your #1 salespeople. But for them to be so, they must be happy and successful! Therefore, your first priority is to get your current franchisees in a place where they are “blubbing” about how amazing the franchise opportunity is. Then work with them to help you achieve your goals, by them spending time with your potential franchisees that are close to signing the agreement and help getting them converted.
© Ashtons Franchise Consulting
This article was published in the British Franchise Association’s FBI Magazine.
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