I have two very different constituencies that rely on my expertise and ability to find and monitor the best opportunities in the franchise industry.
The first one is large multi-unit franchise owners and investment funds. The second group are people new to franchise, and often business, ownership. The way they operate could not be more different if they tried. If you are looking for a good model to follow, the first one clearly has a bigger track record of success as of today.
Those very successful owners all started the same place as the group new to franchise ownership. My hope is that with this column I can pull back the veil a little for those new to franchising as to what those bigger players do that makes them more successful and to how they target particular opportunities at certain times to accelerate growth.
The first thing that we should discuss is that the larger groups look at opportunities as investments more than ways to explore their passions. They want to build portfolios, or even empires! Sometimes in one brand, more often with multiple brands and sometimes even multiple industries.
There is, in my opinion, a poor piece of advice that we have all heard that we should turn our passions into how we financially support our family. I understand the premise of that and sometimes it is possible to follow that advice, make money from your passion and be happy. The more likely outcome could also be that either your passion is not easy to monetize or that if your passion becomes your work you may end up disliking your passion because it feels like work now.
Here is my humble suggestion: Let your work support your passions and leverage your best skills into greater success and freedom to do whatever you like.
Now, with the stage set, let’s talk about how to create massive growth that supports your lifestyle instead of becoming your lifestyle!
Markets ebb and flow, trends come and go, but empires can always grow.
The first thing new owners need to keep in mind is that you don’t have to own any business forever and sometimes your best benefit is in making a transition. The advice of an old friend is that “It is as important to know when to get out of a business as it is to know when to get in.”
As a business owner you watch the market, tap the advice of experts like me and monitor your Key Performance Indicators (KPI’s) to gauge when you should consider a liquidity event to capture maximum value of your previous investment that may be on the decline to bring onboard your next investment where your goal is to catch a new rising market trend and fully maximize your reinvestment.
Always remember that the business you own is an asset and your role is to maximize the value of the assets in your portfolio.
The right opportunity will be one that can maximize the value of your skills, the trends in the market and the investment that you bring to the table. When scaling a high performance portfolio, you will look for lean and efficient businesses that have very predictable growth plans that you can execute. These days service franchises are particularly interesting, one notable parent franchisor our candidates are looking at is about to kick off a massive growth effort backed by added support and marketing making it very interesting right now.
This brings us to looking for the “right time”.
Occasionally you will find a franchisor that is about to put significant resources behind a brand, and this could play into your benefit. When you can leverage your resources and theirs it could lead to explosive growth.
The key is being able to identify both sides of this strategy. For some owners that comes with practice, for others it comes by hiring people like me to do it for them. When you find the right opportunity at the right time then you need to be ready to move and act decisively. I have candidates that I have already discussed their key parameters with and when opportunities come up they have already told me to move them forward and submit their paperwork to the franchsisor for consideration before calling them. They know time is of the essence in the most desirable opportunities.
Put your growth strategy together, watch your current business for signals it is time to sell and at the same time that you watch for franchises that may new and in high demand run by outstanding executive teams. Think like an investor and let your business support your passions!
What is your success story? Let’s go find it!
George Knauf is a highly sought after, trusted advisor to many of the top franchise ownership groups in the world. With over 25 years of experience in both start-up and mature business franchise operations he is uniquely qualified to advise individuals that have dreamed of Building their own empires. Whether you have an existing portfolio or searching for your first franchise, he can help you to pursue your dreams. Contact the Franchising USA Expert, George’s Hotline: 703-424-2980.