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Three fear factors of potential franchisees

Anyone starting out as a first time franchisee in any business steps right out of their comfort zone and has to learn a host of new skills. With a new career, responsibility for their own business success and a financial investment to recoup, fear of failure can be the driving factor for any new business owner.

However when buying into a proven franchise system much of this fear can be alleviated. Franchisees get the back-up of a brand, a franchisor who has tried and tested the model, and a support team to help with training and establishing the business. 

Even with these reassurance, it is natural for people still to have misgivings – will they, as an individual, be able to make it all work? How a franchisor helps redress the fear factor will depend on the particular system – and the franchisee’s specific concerns.

But as Lerida Grant, marketing manager at Café2U, reveals franchisees commonly share three major fears: fear of the customer, fear of not consistently delivering a high level of quality and fear of not meeting business goals.


1 Fear of the customer

A good franchise training system will help address the issues of not just deaing with customers but sourcing customers. Many people are experienced in dealing with other people, but most don’t have the experience of being in the spotlight all day, every day.

For some franchise systems, the franchisee is upfront and centre on a daily basis.

At Cafe2U new franchisees are trained on customer relations techniques in the classroom and shown by example in their first two weeks in their business by their franchise development manager who is with them all day, every day for the first two weeks.

“Another side of this is many people have a fear of finding their customer, and do not wish to “knock on doors”. Once again the franchise development manager actually does most of this for the new franchise partners and trains then on how to go about it for the future,” explains Grant.

The aim is not just to get the new franchisee undertaking new tasks they would have feared before joining their franchise, but to get them to achieve a high level of competence so the activity becomes second nature.

2 Fear of not delivering quality every time

Franchising is founded on the principle of replication and consistency. Why do customers choose a franchised product or service? Because there is a reputation attached to the brand, and they understand what the service or product will deliver – every time.

That can be daunting for a newbie in the franchise network. Particularly when franchisees are managing so many new aspects of their business. But the product or service is the crux of the business – it has to be right.

Training is paramount and can vary in length and intensity, according to the system. Solid, intensive training to get   franchisees well established in the techniques forms a good grounding to their business.

Of course the product has to be right too, and that comes down to ingredients and equipment. Franchisees need confidence that the tools will do the job, time and again.

“The franchise support network that Cafe2U offers is also paramount in assuring the new franchise partner is always performing at their peak,” says Grant.

Support can take many forms in a franchise, from a personal business coach to head office staff that a franchisee can have access to, and of course other franchisees in the network that experience the same challenges and can share their solutions.

3 Fear of not reaching their business goals

A major concern people have is wondering how they are going to make a living while they are building their business. In most new ventures working capital is essential to provide that financial fall-back. Some franchisors though are finding additional ways to help franchisees get through this crucial business-building period.

One solution is an income guarantee. This relieves the franchisee of some of the pressure around making sales and allows the focus to be on building the customer base and getting to know the customers.

But the challenge for franchisees is to use this as a bridge to better sales through their own initiative; it's never intended as a replacement for effort and self-generated income.


When the company was faced with common threads of concern among its new franchisees, Cafe2U decided to tackle the problem and address some of the fears that their new franchisees were facing.

“We asked our franchise development managers who are responsible for launching, setting up and ongoing support for each individual Cafe2U business. These “business coaches” not only do the formal classroom training of the new franchise partner, but also spend everyday with them of their first two weeks setting up their business.”

The resulting Acceleration Package is designed to get franchisees over those hurdles and focus on getting to know their customers and building their business at a faster rate.

A key element of Cafe2U’s Acceleration Package is an income guarantee of $500 a day for the first two weeks while franchisees are in their launch phase. 

The company is confident that given the right training and an intensive two week launch with the franchise development manager, franchisees will have honed all the skills they need to continue this level of business themselves.

“The new franchise partner is then closely monitored using specific Cafe2U business tools to steer them in the right direction. Together they will then gauge when they are ready to increase their run and go to the next level,” explains Grant.


Getting into the business of course isn’t just about learning the ropes, meeting the customers and managing the money. Many new franchisees set themselves specific goals that a franchisor can help refine and help develop action plans during training.

“We recently had a new franchise partner who achieved his first goal of achieving a minimum of his launch target of $500 a day by himself every day for four weeks and sent us a photo of him popping the champagne cork to celebrate!” says Grant.

“Our corporate mission is to ensure our franchise partners are prosperous from day one and every single person on the team is committed to ensure that this happens."

Establishing your own business is a challenge, but with franchisor support some of the stress of the initial stages of development can be relieved.

For any franchisee the key to overcoming the fear is having confidence that the tools and support provided in the system will meet their needs and help them prosper.


Appeared on 3 December 2012