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Are Your Franchisees Cheapskates?

  Dec 12, 2018   Fred

I want to start off with a question – How money motivated should a franchisee be?

Of course, you want to franchisee to be motivated to succeed. You want them to be profitable and the more money he or she makes, the better for everyone. But, is there line that shouldn’t be crossed?

I had an experience at a fast-casual pasta and pizza restaurant a while ago that demonstrates one of the many problems that money motivated franchisees can cause.

At this restaurant, the server came to take our order and my wife ordered pasta. You wouldn’t think this is a big deal, considering we’re in a pasta and pizza restaurant. It got very interesting when the waiter told my wife that they were out of pasta!

He also informed her that they were out of cheese, so pizza would also be unavailable. The server suggested that we try the hamburgers! My wife asked the server why they would be out of pasta and pizza when that was their specialties.

The server was grappling for a suitable answer and that’s when I said to Jill, “I know why they don’t have those items. The franchisee has overstocked on slow moving items and wants to move them. It’s suggestive selling done absolutely the wrong way.”

My wife was surprised. “Shouldn’t the franchisee have what people want? Shouldn’t his or her main focus be on making customers happy?”

I replied, “Unfortunately, the franchisee isn’t concerned with making customers happy. He’s concerned about the money he’s spent on stock.”

I looked at the server and he looked stunned. “How did you know?” he asked.

My wife said, “If the franchisee is doing this to save money, you have to wonder what else he’s doing to save a buck.”

We left the restaurant and haven’t returned since.

In our research, we have found that with successful franchisees, money is not their primary motivator. In fact, successful franchisees are far more interested in things like:

  • The challenge of running their own business
  • The products they sell
  • Being successful in what they do

You may be asking yourself how you can avoid the Money Motivated candidate. Unfortunately, people who are motivated by money will seldom admit it, but there are a few questions that may help you.

Questions like:

  • How would you define success?
  • What’s your biggest dream in life?
  • What goals, including career goals, have you made in your life?

Our friend Bob, the franchisor was frustrated with franchisees that nickel and dimed the customer. He wanted to make sure that money wasn’t a primary motivator like it was with the franchisee I ran into at the pasta and pizza restaurant.

To find out if a candidate’s prime motivator is money, Bob uses the FranchiZe Predictor with its independently proven accuracy of 93% when predicting which candidates will perform in the top 25%.

It’s easy to use, easy to implement and quickly tells him if a candidate has what it takes to be a top franchisee.