Shortage Of Suitable Franchisees Is A Worsening Problem

Bfa:

A lack of suitable franchisees is an on-going and worsening problem for the British franchise industry, with over half of franchisors identifying it as an issue, according to the 2006 NatWest/British Franchise Association (bfa) franchise survey.

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Bfa head of marketing Dan Archer said: ‘There are key attributes that franchisors look for, irrespective of the operational nature of the business, such as drive, determination, an enterprising nature, and a measurable success in what the individual has done to this point. They would want to assess the enquiring nature of the individual. Do they question the franchisor and any existing franchisees that they meet? Have they taken the time to research franchising properly or attended seminars to learn about the sector?’

Mixamate Concrete, a specialist provider of mixed-on-site concrete and flooring screed, provisionally listed with the bfa, currently has 15 franchised territories.

General manager Alan Gibson said: ‘In addition to the qualities that most franchisors seek, such as drive, ambition and enthusiasm, we need franchisees who have really researched the market place and, having chosen us, carried out some serious business and financial planning.’

Our of the company’s newest recruits will shortly open a franchise operation in South Wales, and according to Mr Gibson, typifies their ideal candidate. He said: ‘Having researched the franchising concept thoroughly, prepared and researched a short list of franchises, and chosen Mixamate, he got stuck in to all the preparatory work involved in setting up his Mixamate business. In other words, he’d done his homework; got a business plan together, researched his intended territory and did some serious financial planning. He is logical, organised and methodical, with tenacity and vision along with a tremendous determination to succeed.’

A big turn off for franchisors is the prospective franchisee who is looking for a ‘get rich quick scheme’ with an immediate or very short term break even. Then there are the highly entrepreneurial candidates who may find it difficult to follow a proven system, and those who are just testing the water, perhaps potential competition, who want to find out about the franchisor’s business before setting up their own.

Finance and a lack of entrepreneurial spirit are also reasons for rejecting a franchise applicant. But given the chronic shortage of potential talent, are franchisors inclined to relax their recruitment criteria? Dan Archer added: ‘There is no doubt that when it comes to recruitment franchisors are facing a huge challenge. However, the problems that can arise as a result of awarding a location to an unsuitable candidate can be protracted and damaging. It could be argued that during times of difficulty the recruitment criteria become even more stringent as the total number of suitably qualified prospects is reduced.’


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