Starting a Franchise: Lessons from Five Guys and the Burger Industry
The fast food burger industry has proven quite instructive. By all accounts when considering a mature market with well entrenched competitors such as McDonalds and Wendy's‚ conventional thinking would dictate against new competitors and franchisors entering this market. However – as with many things in life – there are no constants and there is always room for improvement. Enter 5 Guys Burgers (a favorite of mine) and the traditional burger market is once again shaken up with the creation of what appears to be a thought out and well established franchise system. This leads us to an interesting article about Five Guys Burgers and Fries and In-N-Out Burger by Ira Kalb at bnet.com titled "How to Compete Against the Big Guys".
Some points/questions raised in the article are:
- Making sure your product is unique – What competitive edge does your burger and other foods/services offered have over your competitors. A unique product will help your franchise to stand out from the other choices available to consumers.
- Satisfy Consumers and Franchisees – In order for a franchise to experience growth and success both customers and franchisees must be satisfied with the franchise. Without a mixture of both a franchise more than likely will struggle to truly be successful in the long run.
- Making sure you have the legal "stuff" intact BEFORE you expand – Trademarks‚ recipes‚ logos‚ any special branding or information about your product or your company needs to be protected. It is also important to make sure your disclosure documents and franchise agreement project the correct information and protect you.
The information is somewhat generic but from my perspective potential franchisors should give some significant thought about how your franchise will "satisfy franchisee" expectations. Satisfied franchisees are critical to franchise system development. What factors do you think are critical to franchisee satisfaction?
For additional information about starting a franchise or expanding an existing franchise contact us at 1-800-976-4904.
By Charles Internicola June 28, 2011
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