Have you ever wondered what makes some franchised businesses more successful than others?
Research company IBISWorld identified 240 elements that lead to success, which it boiled down to six key factors.
- A loyal customer base – as this increases the likelihood of repeat custom.
- A clearly defined market position – which enables franchisors and franchisees to aim for the same target market.
- Business operator expertise – franchisors that possess business expertise are generally better at leadership and guiding their franchisees in business growth.
- Control of inventory – this helps ensure client demand is met while reducing inventory costs and wastage.
- An established brand name – a recognisable brand assures customers of receiving a pre-anticipated experience when they interact with the business.
- A knowledgeable and trained workforce – this improves the likelihood of a loyal customer base.
But don’t forget mindset!
Psychological factors can also be important ingredients in franchised business success.
Decades ago, the Carnegie Foundation determined the three main characteristics of success to be skills, knowledge and attitude. However, some motivational experts and businesspeople believe attitude makes up about 85% of that mix!
A positive attitude in business is one that encompasses excitement, ambition and a long-term focus. Other psychological factors influencing a person’s attitude and success include a sound self-awareness, high motivation, goal orientation, responsibility and accountability, and being a good team player.
So it would seem success in a franchised business is influenced by a mix of elements, including business structure, branding, customer retention, skills, knowledge and a positive mindset.
What do you consider to be the most important elements for business success?