The franchise consulting industry was fairly embryonic when I hung up my shingle in 1999. There were a few small to modestly sized organizations, and we were barely a blip on the radar. Today, the franchise consulting space has “arrived” in that our impact on franchise growth is acknowledged as significant and, like real estate agents and financial advisers, we are now a dime-a-dozen.
In Atlanta alone, there are at least 90 others who don the title franchise consultant, franchise broker, franchise adviser, franchise coach, franchise matchmaker…. Every year, I receive more inquiries about joining my Georgia franchise consultant team. This business has many appealing qualities: low cost of entry and overhead, flexible hours, helping others realize their dreams of independence, and a nice living if you’re successful.
Alas, every rose has its thorns. Many people enter the franchise consulting space after having worked with a franchise consultant themselves; they think “I like what s/he does.” I’ve created numerous competitors who quickly learn that I make this business look easy. He, he, he….
First there is the Economics 101 issue of supply and demand. There are fewer qualified candidates “shopping” for a business than there are franchisors offering franchise opportunities, even in today’s anemic, anti-baby boomer job market. Likewise, there are more franchise consultants with lines in the pond than there are fish that will bite.
Then there’s the issue of product knowledge, our product being the franchise opportunities we represent. I spend 20% of my time in conference calls, webinars, and meetings learning and staying up to date on the nuances of the many different opportunities. I must have an in depth understanding of my product to be able to connect the dots for my clients and make appropriate matches. It’s an enormous amount of information to digest and remember; the best franchise consultants know their products inside and out.
Ongoing education is time not spent on marketing, prospecting and working with clients. And speaking of marketing/prospecting, it’s how I spend 60% of my time. Good thing for me that I’m a marketing rock star and love it. Only 20% of my time is working with clients; this is the biggest misconception that wannabe franchise consultants have about this business. Those who don’t care so much for marketing and prospecting, are lousy with time management, and/or don’t have a good memory for detail typically fail.
Let’s talk about the “low cost of entry and low overhead” advertised by the several franchise consultant training outfits that churn out newbie franchise consultants faster than Keanu Reeves puts out bad movies. Compared to a restaurant or retail business, the upfront investment and overhead is low, yes. But those of us in the top 1% of our field have made significant investments into our businesses. We have ongoing administrative and marketing support infrastructure and continue to invest in our own training and education.
Marketing is the biggest cost in our business, especially in the early years. And we have enough in reserves to weather the early years; anyone in the 1% club will tell you that it’s a three year climb to reach a state of stability, predictability and significant revenue.
For these and other reasons that would make this blog post too long, the franchise consulting space is a revolving door. I know only one other in Atlanta whose been at this as long as I and can count on my fingers who’s been around five years or more. The growth of our space is a good thing no doubt, especially for me. There’s greater awareness and acceptance of our service and the abundance of fledgling, unqualified and desperate franchise consultants makes it all the easier for my firm to stand even further above the pack. (Can you tell I’m a bit competitive?)
Yes, most people starting franchise consultancies are unqualified to do so. I’ll elaborate in part deux.