In this industry, we are all aware of the benefits of being part of a franchise as opposed to an independent small business: a proven business model, shared resources, brand awareness, support for operations, reduced risk, and economies of scale.
With franchise platforms, those benefits can be supercharged and taken to an entirely new level. When great franchise brands share a vision as a platform and focus on a vertical, such as home services, franchise owners can see their opportunities for success multiply. And, franchisors benefit as well, enjoying unique opportunities that leverage consolidation and diversification to accelerate growth across brands, providing resilience and operational efficiencies.
Here are just a few of the advantages franchise owners can see with a franchise platform, and how franchise brands benefit from the platform model:
- Shared culture and values: A franchise platform can leverage individual brands and its own mission and values to build a comprehensive, resilient company culture shared across brands, by all stakeholders, from franchise employees and owners to the platform team and leadership. The shared sense of purpose that results can guide leaders and their teams as they respond to challenges and opportunities. Ultimately, the power of a common vision and culture will unlock value across brands and throughout the stakeholder chain. The energy, inspiration and discipline that result from a strong culture are amplified when the platform and individual brands are aligned.
- Buying power: The depth and breadth of many franchise platforms is an immediate advantage when it comes to strategic and vendor partnerships. The platform model brings together hundreds of franchise owners across multiple brands, offering a range of unique services. This combined buying power allows platforms to create value by establishing lasting relationships with preferred vendors. As a result, platforms can negotiate competitive pricing, access to exclusive products and services, and profit-driving opportunities such as rebates that aren’t available to independent franchisors.
The ultimate value may be the time and effort franchise owners can save with a platform’s combined buying power. Connecting to a platform’s network of preferred vendors means owners don’t have to find their own solutions. They can focus on growing their business.
- Shared services: In a shared service model, the platform takes on operational processes such as human resources, accounting, legal and IT for the individual brands. The efficiencies created through shared service allow individual brands to focus on helping new and established owners grow their business. Shared service supports brand leaders and their teams in their mission to empower owners and drive growth for their brand.
- Shared data: Platform companies have a deeper set of data and more powerful analytics tools available than independent franchisors. With more and better data and analytics, franchise platforms can identify trends in business and the economy and adapt and evolve quickly. Insights can be filtered by industry, vertical, geography and more to drive precise decision-making. Sharing data across brands allows platform companies to scale insights and best practices quickly and effectively, enhancing customer experience and distinguishing themselves in their market.
For franchisors, a platform can leverage data from one brand to streamline conversions through internal referrals. With complementary services, leads can be retargeted for other brands with the goal of lowering the cost of customer acquisition.
- Unique growth opportunities: Franchise platforms are able to provide a diversity of service offerings – and more paths for growth than independent franchisors. Franchise platforms attract candidates from a variety of backgrounds. They bring a wide range of skill sets and experience. Each candidate has their own goals, whether that’s owning a single territory, owning multiple territories from the same brand or multiple territories across multiple brands.
Platforms can identify these owners and align their goals with the right opportunities. With a platform, owners are in a position to expand a single brand across multiple territories or to diversify the services they offer in their community across multiple brands. Individual growth goals may evolve based on an owner’s success in the industry or life changes.
Platforms offer a secure foundation for franchise owners to build on. They will benefit from shared resources, amplified insights, operational efficiencies, common values and mission, and a wide range of growth opportunities. Combined services and diverse offerings ensure resilience and can power accelerated growth.
The true impact of a successful franchise platform is felt when the franchisor and owners are in sync. When the franchise system is dialed in to empower franchise owners and owners trust the platform’s processes, the benefits begin to compound and multiply. The company’s culture becomes stronger, its buying power increases, further efficiencies are uncovered, and, most importantly, new opportunities for growth emerge.
J. Andrew Mengason is chief growth officer for Five Star Franchising, an innovative, growing platform of home service brands, including Five Star Bath Solutions, Gotcha Covered, Bio-One, 1-800-Packouts, 1-800-Textiles, and Mosquito Shield. He has more than 30 years of experience in franchising and brand acquisition.