Module 1: An Introduction to Franchising

AN INTRODUCTION TO

FRANCHISING

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WHAT IS

FRANCHISING? ESTABLISHED BUSINESS

TRAINING & SUPPORT

AN INTRODUCTION TO FRANCHISING

SUCCESS

Franchising is an industry in which businesses create, perfect and sell their business models to individuals who are then trained and supported so they can provide the branded services to their respective clients. Franchising requires a relationship based on trust, respect and open communication.

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HOW DOES A FRANCHISE

OPERATE? The franchisor (the company) has a responsibility to maintain the integrity of the brand and create systems, processes, structure, marketing, and other resources that produce results that are far superior to any that an individual can produce on his or her own.

FRANCHISOR

FRANCHISEE

The franchisee (the individual franchise owner) has a responsibility to serve the customers to the best of his or her ability, consistent with the franchisor’s original intent.

The actions taken on each side of a franchise agreement greatly impact the other.

AN INTRODUCTION TO FRANCHISING

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RETAIL & SERVICE

RETAIL & SERVICE REVENUES

WHY IS FRANCHISING

POPULAR?

FRANCHISING 10%

FRANCHISING REVENUES

AN INTRODUCTION TO FRANCHISING

The Small Business Administration states that there are more than 3,000 franchise companies representing over 80 different industries. And while franchising accounts for only 10 to 12% of all retail and service enterprises, it represents over 50% of the revenues in these sectors.

The success that many franchises have been able to achieve makes it an attractive alternative to a corporate career or going it alone with a standalone business.

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FRANCHISING MINIMIZES

RISK In a sense, franchising is a business opportunity with the primary purpose of minimizing risk. Every study done on the success rate of new non-franchised business startups concludes the same thing – starting up a new business is risky. Most studies show that more than 90 percent of new businesses fail within the first 3 years. The primary reason that the failure rate is so high is the learning curve of operating that business.

Individual Business Established Business Model

AN INTRODUCTION TO FRANCHISING

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WORK WITHIN AN

The franchisor has already gone through the learning curve and has learned the secrets of success for their specific franchise model, which they pass on to the franchisee.

EFFORT

ESTABLISHED BUSINESS MODEL

On the other hand, “business format franchising” – where the franchisor provides the franchisee with an established business model, including a brand name and trademark, for the franchisee to run independently greatly reduces this risk.

TIME

AN INTRODUCTION TO FRANCHISING

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TYPICAL RESIDENTIAL CLEANING FRANCHISE

MAID RIGHT RESIDENTIAL CLEANING FRANCHISE

MASTER FRANCHISE OWNER

FRANCHISE OWNER

HOURLY EMPLOYEES

AN INTRODUCTION TO FRANCHISING

UNIT FRANCHISE OWNER / OPERATORS

HOURLY EMPLOYEES, AS NEEDED

FRANCHISE STRUCTURES IN THE

RESIDENTIAL CLEANING INDUSTRY Within the franchises operating in the residential cleaning industry, Maid Right is uniquely positioned.

Our business is based on a three-tier master franchise model – the only one of its kind in the residential cleaning market.

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WHY OUR FRANCHISE MODEL GETS

BETTER RESULTS Instead of employing cleaning crews, a Maid Right master franchise owner awards unit franchise licenses to owner operators who directly service the home cleaning needs of their clients. We find that encouraging owner operators to run their own small business results in a higher commitment to quality service over someone who is just working for a paycheck.

As the master franchise owner for your market, you’ll focus on nurturing startup entrepreneurs who want to be self-employed or earn extra money with a side business.

And you’ll be backed by protected territories, marketing and advertising programs, and extensive support within the franchise infrastructure.

AN INTRODUCTION TO FRANCHISING

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YOU’LL HELP

SMALL BUSINESS OWNERS Instead of spending your time hiring hourly cleaning crews, as a master franchise owner, you’ll secure residential cleaning accounts and award unit franchises to owner-operators who will directly service the home cleaning needs of the accounts you provide them.

Your role is to educate, encourage and support your unit franchisees.

To initially build your business, you’ll need to find the right prospects and with our support inspire them with the benefits of starting their own Maid Right franchise business.

AN INTRODUCTION TO FRANCHISING

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TRAITS OF A GOOD SALESPERSON • Conscientiousness • Respectful • Initiative • Listening • Persistence • Coachable

• Positive • Resourceful • Passionate • Inquisitive • Independent • Personable

LEVERAGE YOUR

STRENGTHS The master franchise model is a powerful tool to help build a long-term legacy. It’s proven. It’s reasonably predictable and it has redundant support systems.

But as a potential master franchise owner, you must assess your own skill levels as part of this process.

TRAITS OF A GOOD MANAGER • Positive Attitude • Empathy • Accountability • Honesty • Patience • Prioritization

AN INTRODUCTION TO FRANCHISING

• Flexibility • Confidence • Reliability • Organization • Communication • Mediating

The master franchise concept can be especially attractive to someone who has been an executive at the corporate level, because they usually have strong management or sales skills along with the financial strength to develop and operate a master franchise territory.

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THE GOLDEN RULE OF FRANCHISING

BE OPEN TO ADVICE! Franchise owners who typically do well are open to advice and welcome a guiding hand. Studies have found that franchise startups rarely fail, but if they do, it’s typically because the franchisee did not follow the franchisor’s systems or business model.

AN INTRODUCTION FRANCHISING TO FRANCHISING

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A RECENT STUDY FOUND

90%

of franchisees enjoy operating their business.

*SOURCE: FRANCHISE BUSINESS REVIEW 2014 SURVEY

AN INTRODUCTION FRANCHISING TO FRANCHISING

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A RECENT STUDY FOUND

88% enjoy operating their franchise business.

*SOURCE: FRANCHISE BUSINESS REVIEW 2014 SURVEY

AN INTRODUCTION TO FRANCHISING

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85% A RECENT STUDY FOUND

feel positive about their affiliation with their franchisor.

*SOURCE: FRANCHISE BUSINESS REVIEW 2014 SURVEY

AN INTRODUCTION TO FRANCHISING

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FOR BEST RESULTS

FOLLOW THE PROCESS! As you explore the opportunity available with Maid Right, we encourage you to follow the mutual evaluation process we have outlined. Very often, your willingness to follow the process now will be indicative of your willingness to follow the system later.

AN INTRODUCTION TO FRANCHISING

And remember the #1 reason franchise businesses don’t work is because people don’t follow the system.

As the franchisor, we can provide the plan, but you must supply the discipline to follow the system and the motivation to stay the course. We know you can do it, and we are here to help you succeed!

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“

In sports, the only thing a player can truly control is effort. The same applies to business.

“

The only thing any entrepreneur, salesperson or anyone in any position can control is their effort.

MARK CUBAN

AMERICAN BUSINESSMAN AND INVESTOR

AN INTRODUCTION TO FRANCHISING

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EVALUATING A

FRANCHISE Be sure to consider the following when assessing different franchise opportunities.

TRAINING PROGRAMS Be sure the franchise company provides solid training that is well documented and has a track record of success. A franchisor’s training programs are a sure signal of their commitment to your success.

TALK TO FRANCHISEES To get a solid feeling of what it’s like to run the day-to-day operation, talk to both new and established

AN INTRODUCTION TO FRANCHISING

franchisees. While evaluating the economics of an opportunity are critical, choosing a franchise that suites your lifestyle is equally important.

SPEND TIME AT A LOCATION There’s no better way to cap off your research than by spending time in a franchise location. Invest the time to see what your life would be like in that business model.

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“

“

Finding the franchise that is right for you is key to your success!

AN INTRODUCTION TO FRANCHISING

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THANK YOU! Thank you for taking the time to learn more about franchising.

Please complete a short questionnaire about the information you just read. It will only take a few additional minutes of your time, and it will allow us to continue to move forward in the mutual evaluation process.

AN INTRODUCTION TO FRANCHISING

CLICK HERE FOR QUESTIONNAIRE

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