Existing and long-serving businesses in the franchise industry have created the notion that franchise businesses have to exist according to standards and procedures set out by the industry. While this might seem to be the way to go, this common misconception has the potential to harm new businesses that might be left with no option but to adopt the patterns and traditions of established businesses. If something works for an established business, however, it does not follow that it will work for new businesses. New businesses fail as a result of not having solid and sustainable plans on how to drive their businesses, relying – instead – on plans and strategies developed by existing businesses. The number of years a business has existed is not what sustains that particular business – rather, the sustainability factor relies on the value offered to the market.
First and foremost, it is important to know and understand your corporate identity as it is the starting point which steers the business in the right direction. Businesses with a clearly-developed identity will know what to offer, how to offer their products/services, as well as what not to offer and when their offerings would be deemed unviable. It is therefore of paramount importance to understand your abilities, skills, and resources before venturing into environments in which you would offer aforementioned abilities, skills, and resources.
How a business positions itself determines how it will be perceived in the market context. The positioning directs the trajectory of a successful business. Businesses with great reputations are those that walk the talk and abide by their promises. Businesses that strive to convert a lead into a customer makes the journey worthwhile, adding more value and ensuring the long-term survival of the business. This process goes hand-in-hand with being transparent and open about intentions. Transparency is the cornerstone of a long-term business relationship, but also has the capacity to be the most harmful threat to future business prospects if customer trust is compromised in any way.
One of the most important things to do is to develop a firm understanding of the customer, so that you will be ready with a plan to anticipate the evolving customer trends. Should a business encounter criticism from customers, it must be seen as an opportunity for growth. Franchise businesses with no solid plans that benefits the customers, but focus only on taking from their customers without any intention of giving something in return, tend to have short life-cycles.
A healthy relationship in any franchise business heavily depends on a two-way process model. Tactful franchise businesses go the extra mile by launching customer plans and strategies that seek to address customers at various stages of the product life-cycle. The main idea behind this approach is to always know how to respond to the needs of a customer at each phase.
What you have to offer as a business should be what entices a customer. The market actively seeks out benefits or unique offerings that serve as differentiating factors of businesses. Demand is created out of understanding. In a 2019 stats finding by Stats SA, “[s]mall businesses in Q1 of 2019 had the highest percentage of turnover and the biggest market size at 49% over the large business market at 42%. This trend is as a result of the shifting needs of customers into a low-cost small business” (Statssa 2019).
These findings demonstrate that existing franchise businesses should focus on redesigning franchising models to ones that will focus on the low-cost market. The launch of the Shoprite Checkers small-sized retail franchise for the township and rural market is focused on a shifting market that pursues low-cost products and services. The strategic approach pursued by Shoprite Checkers indicates that the franchise is eager to secure or increase their existing market share.
Forward-thinking franchise businesses should be willing to spend time and money on devising ways in which to attract the customers with their products and service offerings. Franchise businesses must look to invest more in building service offerings that will benefit the customer in the long run. (Business Insider 2019)