Google’s New Promotion Tool Called Post

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Google has just released a new promotion tool for businesses and celebrities called Google Post.  Traditionally, Google’s promotion tools for businesses have focused on its AdWords online advertisement platform and its Google+ social media network.  Although AdWords is still going strong (advertising accounts for 90% of Google’s revenue!), Google’s social network Plus is widely regarded as a failure as compared to Facebook or Twitter. 

Never one to leave an internet industry untouched, Google Post is the company’s latest attempt to have social media users go on Google to find information about their favorite celebrities or businesses.  The service, called Google Post, places a curated feed of social media posts directly in the search results, providing you a mix of websites and real-time updates to look through.  The implications are big: now, when someone searches for your brand or organization, you don’t have to solely depend on SEO for your website to be the top hit.  You can speak to online searchers directly through your social media content.

Andrew Jewelers is one of the first organizations to use this new service.  Right under the link to their website is a clickable social media feed which leads to a personalized promotional page for the jewelers.


Businesses aren’t the only ones taking advantage of this, however.  Google has invited 2016’s presidential candidates to test-run the platform.  As of today, only Donald Trump hasn’t taken advantage of the new service.

Google is currently taking applications for others to get on their waitlist to use Google Post.  I recommend you sign up!  It will be a powerful new way for you to speak to your customers directly when they search for you, allowing you to shape the online discussion of your brand.

Small Businesses are Receiving More Financing

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The Federal Reserve just released a report documenting financing results for small businesses in 2015, indicating that approval rates for small businesses had gone up compared to 2014 levels.

The Role of Small Businesses

Small businesses have had a hard time since the financial crisis in 2008, as small firms depend more on access to financial capital from banks to fund their growth.  When credit dries up, the boost businesses receive from the credit markets slows and accelerates the economic downturn.  It’s important to remember, small businesses create two out of every three net new jobs and employ half of the private sector workforce according to Harvard Business School.  During the post-2008 economic recovery, small business lending took a long time to recover as lending rates declined 20% causing small business loans to drop from composing half of all loan volume to below 30%.  This credit crisis has slowed the recovery of an integral part of the economy.

Small Business Lending Comeback

The Federal Reserve’s credit survey for 2015 showed that financing rates for small businesses have been improving, with 79% of firms reporting being approved for some financing, and 50% being approved for all their financing needs. It seems that small banks are picking up a lot of the slack left by big banks reducing their lending volume to small businesses.  Small banks have 18% higher approval rates than big banks for small business loans, earning a customer satisfaction rating of 75 compared to a rating of 51 for large banks. 

Still a Long Way to Go

Unfortunately, the full financing needs of small businesses are not being met.  Business owners continue to report that managing cash flow is one of their top business challenges.  50% of financing applicants in 2015 had a shortfall in the amount of money they received, reporting that an insufficient credit history and collateral were the main reasons only part of their request was met.  Both large and small banks will have to increase their lending volume to meet the demands of American businesses.

Who Businesses are Turning to For Financing

Under these new conditions, small businesses are turning elsewhere to meet their financing needs.  20% of employer firms applied to online lenders, who have been lending money out with approval rates of 71%.  However, the satisfaction score they received from the businesses they lend to was only 15, much less than that of small and big banks.  Other businesses turn to credit cards for any financing needs.  The best place for small businesses to go to for any of their funding needs remains small banks, however, as they boast the highest approval rates, satisfaction ratings, and transparency ratings of any of the options.

To learn more about entrepreneurship through franchising, attend our free monthly webinar, Franchise Ownership as a More Stable Career Path. The webinar is free, but you need to pre-register, which you can do online by clicking on the linked seminar title.

You may also register by calling 866-246-2884.

What Makes the Modern Team?

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How people work is changing.  Increasing emphasis is being placed on teamwork and cooperation between coworkers; today, MBA programs are filled with student teams, the expectation being that modern workers will need to manage team dynamics, collaborate across departments, stay in communication with other employees, and juggle all the new responsibilities workers have in the 21st Century.  But why do certain teams succeed and others fail?  It’s not as simple as throwing smart people together in the same room.  Proper team management requires appraising your employees’ values, skills, temperament, and more to create a team worth more than the sum of its parts.

Understanding Team Dynamics

Many companies are becoming obsessed with maximizing worker performance, and a key factor in productivity is inevitably tied to how employees contribute to a team’s output.  The rise of Big Data has provided powerful tools to minutely analyze what actually makes a high-performing team successful, and one of the most recent insights was just published in The Harvard Business Review.  They found that “the time spent by managers and employees in collaborative activities has ballooned by 50 percent or more” over the last two decades, with the majority of their time simply spent communicating with  colleagues.  The ability to work effectively with others is now one of the most important skills a worker can have, and managers should be working to make sure employees are placed in the right environment.

Many workplaces have rough heuristics for creating a successful team:  “match introverts and extroverts,” “don’t have too many strong leaders,” or “good friends make good teammates.”  But how can you be sure these are effective?  It turns out that a lot of ideas about how teams work are just plain wrong.  Two teams that are almost identical on paper (same backgrounds, personality profiles, and networks) can produce drastically different results.

The Reason Certain Teams Succeed

Researchers have settled on the idea that group norms have a large impact on a team’s productivity.  Group norms are the unwritten rules and behavioral standards that define a group’s behavior with each other.  For example, one team may have a culture that encourages vigorous debate before a decision is reached, and another may believe that sober discussion and agreement produces better outcomes.  These group norms end up overriding an individuals personal work preferences and can be a source of friction and stress.

So what norms end up being enforced by successful teams?  It may surprise you, as many different types of teams can be successful for different reasons.  A high concentration of smart, hard workers wasn’t the recipe; a more well rounded group often found ways to make up for individual weaknesses and adapt quickly to changes.  There were two main factors that indicated a team would succeed:  First, members of a successful team all spoke for approximately the same amount of time.  Each team member was provided opportunities to talk throughout the work assignment and have their opinion heard.  This creates feelings of value and responsibility for team members, enhancing productivity and job satisfaction.  Second, successful teams had a high average social intelligence; that is, they could tell what and how their teammates were feeling as part of the team. Low-performing teams often had members who weren’t sensitive to how their colleagues felt about their work or the team, leading to increased stress and inefficient outcomes.

How to Create Strong Teams

The main two factors are equal speaking opportunities and encouraging social sensitivity between team members, but there are some other indicators of success.  Making sure a team has clear goals is important, and so is creating an environment with a high degree of psychological safety and a culture of dependability.  Managers need to create teams that listen to each other and are there to support each other.  It doesn’t mean that work relationships become more than professional, but it does mean that giving your conduct at work a more personal touch could do wonders for your colleagues’ performance.  


The act of creating and managing teams has an outsized impact on the success of your business.  However, there are a lot of resources out there to help you succeed.  If you’re thinking of starting a business, becoming a franchisee is a great opportunity.  To learn more about entrepreneurship through franchising, attend our free monthly webinar, Franchise Ownership as a More Stable Career Path. The webinar is free, but you need to pre-register, which you can do online by clicking on the linked seminar title.  You may also register by calling 866-246-2884.

Why Video Marketing Is Vital for Your Business

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According to Cisco Visual Networking Index, consumer Internet video traffic is rapidly rising and will account for 80 percent of all consumer Internet traffic by the year 2019. This shows a 64 percent rise since 2014 with no signs of slowing down. Meanwhile, Media Post reports that mobile devices dominated views of Super Bowl 50 advertisements on YouTube, and 60 percent of the 330 million views came from mobile devices.

The numbers are clear. In order to compete in today’s marketplace, you need a video marketing strategy in place that’s also readily available and watchable on mobile devices. Need more convincing? Here’s a run down of why video can significantly impact the bottom line for your business and what to do next.

Video showcases your brand’s culture

You can write about company culture and engage with customers at length, but it still won’t properly translate without a video to show instead of tell. A spirited video of your company at work, emotional testimonials from clients and a behind-the-scenes look at employees at work speaks volumes more than a print campaign.

Brand culture videos help consumers forge a sense of trust and camaraderie with your company simply by giving them a visual view of what’s going on. For example, Amway features a video on its YouTube channel showing how its distributors spend their time away from the 9-to-5 work day and build up their businesses. Consumers can check back and watch more footage to dream of how their life would look if they owned their own business.

Video increases sales

Online retailer Stacks and Stacks reported that consumers who viewed one of their product videos were up to 144 percent more likely to add it to the cart than customers who didn’t.

Giving customers a chance to see products in action and moving in real time, even if it’s just being held or turned to show different features, provides a more realistic view. Instead of needing to come into your store or order your product to see if the photos do it justice, customers can view videos to get a closer look.

Social media is embracing video

YouTube spent years dominating video search, but other search engines and social media platforms are seeing a rapid conversion taking place.

For example, Facebook reports its daily video views doubled from 4 billion to 8 billion in a period of a few months. Video ads are also becoming wildly popular across social media and other online platforms alike, and particularly on mobile devices. YouTube reports the number of hours people spend watching videos on mobile is up 100 percent.

Companies jumping onto the video social media bandwagon are also seeing impressive results. Old Spice pitchman, Isaiah Mustafa, famously answers tweets by video on YouTube, driving consistent traffic across multiple social media platforms. Their videos are also the stuff of viral legend with its new Mom Song.

Video says much more than text

Businesses may feel intimidated to produce compelling videos that spark action, but in reality, they can be more effective at converting customer engagement than print alone.

According to an article by Forrester Research, a minute of video is worth 1.8 million words. That’s certainly more words than you can ever put together in a single ad copy or white paper. Instead of potential customers having to figure out what you’re saying by digesting copy, they can see it quickly unfold by video.

Designing your Company Logo (Infographic)

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What should you be looking for in a logo?  The trend nowadays seems to be to keep it simple, following Saul Bass’s advice to “Symbolize and summarize.”  Within that, however, there are some key elements you should be taking into consideration.  Remember, your logo should be the most recognizable part of your company and convey identity and ownership in a memorable way.

A logo should be simple enough that it can be used in many different contexts.  There are lots of uses for logos: it can be placed on a menu, on letterhead, on a building, on clothes, on pencils, etc.  These myriad uses place a simplicity and practicality restraint on how your logo should look.  It should still be memorable enough, however, that it can be easily remembered and fast to recognize.

Logos have been a part of any public organization for probably longer than writing has existed.   The ancient Egyptians branded their cattle with hieroglyphs to establish ownership, Ancient Sumerian accountants had personal identifying marks, and the Ancient Romans and Greeks marked their pottery with the symbol of its manufacturer.  Even religions use logos, such as Christianity’s cross and Judaism’s Star of David.

The evolution of logo design has advanced quite a bit since ancient times.  Medieval lords, when developing their heraldic coats of arms, took elements like color warmth, blank space, symbolism, and geometry into consideration.  Craftsmen adopted logos to establish the origin and quality of their wares.  Today, with the invention of color printing and the advertising industry, logos are a powerful piece of branding that serve to communicate an organization’s values and purpose.

Below are some simple guidelines and design paradigms that will help you develop a logo for your own endeavor.  With luck and hard work, maybe your own symbol will last a few thousand years.  

To learn more about entrepreneurship through franchising, attend our free monthly webinar, Franchise Ownership as a More Stable Career Path. The webinar is free, but you need to pre-register, which you can do online by clicking on the linked seminar title.

You may also register by calling 866-246-2884.

Alternative Sources of Financing for Small Businesses

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Getting a loan has never been easy, and funding for small businesses has been even more difficult since the financial crash of 2008.  Small business lending is less of a priority for banks nowadays for a variety of reasons:  high transaction costs associated with small business loans, new regulations that call for increased capital requirements against business loans, and a decrease in the number of community-focused banks.  This is responsible for a 20% decline in the rate of small-business lending from before the crash, resulting in 80% of small business owners who apply for a loan being rejected, and small business loans falling to under 30% of total bank loans from previous levels of over 50% (Fundera).

So how can business owners fund their operations?  According to the Small Business Administration, there are four main reasons small business seek financing: starting a business, purchasing inventory, expanding the business, and strengthening the firm.  There are many traditional options for pursuing financing.  Credit cards have always been a big source of emergency funds with 79% of small business owners reporting using credit cards to start or grow their business.  Many individuals also seek financing from friends and family members, or dip into personal savings and retirement accounts.  These are risky sources of financing, however, with big personal liability issues that are difficult to resolve.

For these reasons, alternative lending opportunities have dramatically increased in number to fill the void left by big banks as they reduce their small business lending.  The number of angel investors seeking out promising startups has exploded, competitions where businesses compete for grants are increasing, and crowdfunding platforms like Kickstarter and Indiegogo are more and more popular.  In fact, there are now 191 crowdfunding platforms active in the United States, having provided $2.8 billion in funding to small business, with Kickstarter alone having launched more than 260,000 projects (Statista).

The most promising new form of financing for small businesses is online lending.  As Jamie Dimon (JPMorgan Chase CEO) put it , “Silicon Valley is coming,” saying that “there are hundreds startups with a lot of brains and money working on various alternatives to traditional banking…the ones you read about most are in the lending business.”  Even Larry Summers, the former Treasury Secretary, has endorsed online lending, saying that he believes “technology based businesses have the opportunity to transform finance over the next generation.”  Here are four of the most promising new online lending platforms.  And remember, to learn more about entrepreneurship through franchising, and the plethora of financing available to franchisors, attend our free monthly webinar “Franchise Ownership as a More Stable Career Path” by registering at this link or by contacting The Entrepreneur Authority at (866) 246-2884. 

Lending Club

Lending Club is the biggest peer-to-peer lender in the United States.  A peer-to-peer lender connects investors with excess cash to borrowers directly, generally in the form of unsecured loans through the Internet.  As the worlds largest online credit marketplace, Lending Club offers business loans or lines of credit of up to $300,000, with rates starting at 5.9%, making it cheap, easy, and quick to find financing for your business needs.  

OnDeck

OnDeck is another online lender using technology to make borrowing quick and painless.  They offer short terms loans up to $250,000 over 3-12 months, long term loans up to $500,000 over 15-36 months, and lines of credit up to $100,000 for cash when you need it.  Their main focus is lending to small businesses, and they’ve already delivered over $3 billion in financing, leading to the creation of 74,000 jobs and $11 billion in U.S. economic impact.

Kabbage

Kabbage purports to be the #1 online provider of small business loans, specializing in providing lines of credit from $2,000 to $100,000.  With on online approval process where it takes literally minutes to apply and receive a decision, Kabbage has funded over 100,000 small businesses with more than $1 billion in loans.  Unlike OnDeck, which requires your business to have over $100,000 in annual revenues, Kabbage provides credit to businesses with at least $50,000 in annual revenues.

Headway Capital

Headway Capital is a fully online lender that provides lines of credit up to $35,000 at affordable rates.  They use sophisticated analytics software to evaluate your credit worthiness using not just your credit score, but a host of other factors in a holistic review process.  Headway Capital is a Chicago based subsidiary of Enova International, a leading online lender that has serviced over $15 billion in loans to more than 3 million consumers.  

Strong Growth in Number of Female-Owned Businesses (Infographic)

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Women compose 50.4% of the population of the United States, and yet own only about 35.8% of all businesses.  The persistent gap between female workforce participation and business ownership has been present since the country’s inception, but there are positive trends currently in the marketplace, where even poorer states such as Georgia are seeing huge increases in the number of women business owners.  

In many environments, social and workplace cultural conditions can impede woman from moving up in their careers.  The largest factors are a lack of confidence in women to pursue risky career decisions, insufficient training and education levels, or exclusion from opportunities due to pervasive gender bias in certain companies. Family–Work balance issues are another large factor in businesswomen’s decision making, as research shows that even when women have a job they are taking care of and acting as primary caregivers for their children and parents.  

Many businesses are taking steps to combat problems such as a lack of diversity.  They are allowing flexible work hours, mentoring programs, and training where they can interact with other females in positions of power.  However, one of the best ways to break out of a bad work situation is still to start your own business.  Although a lot of work is necessary for success, owning and growing a business is an incredible education experience, once for which you set the bar for achievement and structure to work within.  If you are interested in business ownership, franchising is a tremendous opportunity to explore an industry and choose the business model that fits your needs and preferences.  Attend our free monthly webinar “Franchise Ownership as a More Stable Career Path” for expert advice and information from our experienced franchise consultants.  Register by clicking on this link or calling 866-246-2884.

Check out this infographic from Balboa Capital to learn more about the growth of women-owned businesses in the United States.

5 Apps Every Business Should be Using

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Running a business is becoming easier every day.  Take advantage of these tech tools for small businesses to supercharge your growth and streamline your operations and expenses.

Slack

Slack is a powerful messaging app seeking to improve group communication.  The service organizes a team’s discussions into multiple group chats, each united by a particular topic defined by a hashtag, such as “#marketing” or “#updates.”  Slack makes it easy to share photos and files due to its integration with other great tech services like Dropbox.  Used by Nasa’s Propulsion Laboratory and Charity: Water, let Slack help you improve the quality of your communication and slow the flow of emails to your inbox.
Price: Free to use.  Premium features are priced at 6$.67 and $12.50 and include usage statistics, priority support, unlimited service integration, and support for message archiving.

Yaldi

Yaldi tracks key performance indicators for your business, including revenue, customer acquisition, sales, and more.  The data is organized into easily readable charts and graphs, and its proprietary algorithm provides you with a “business health score,” allowing you to quickly evaluate the status of your company.  Combined with automated business advice backed by years of management expertise, Yaldi helps you make the best decisions to succeed.
Price: $9.99/month or $99/year

Perch

Perch allows you to collect all your social-media content in one webpage, analyzing your posts and promotions, customer interactions, and your competitors’ social outreach.  The app pulls data from Facebook, Instagram, Twitter, Four Square, Yelp, Google+, and more, providing analytics and alerts to help you improve your business’s social media operations.
Price: Free

Perka

Perka helps you build a dedicated customer base by setting up custom loyalty programs for your online customers.  The tailored loyal programs encourage repeat visits and sales, with sophisticated reward systems on par with airline and credit card programs.  The only downside is that your customer will need smartphones to participate.
Price: Free for the first reward program, afterwards is $39.95 per location per month.

Invoice2go

Invoice2go is the top invoice app, allowing you to quickly create an electronic invoice, email it to a customer in less than 3 minutes, and keep track of unpaid invoices.  With charts and reports, custom invoice templates, calendar and map integration, and more, Invoice2go lets you get paid no matter where you are.
Price: Free to $150 dollars per year for premium features.
To learn more about business ownership through franchising, attend our free monthly webinar, “Franchise Ownership as a More Stable Career Path.”  Register by clicking on this link, or calling 866-246-2884.

2016’s Top 5 Franchises

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Entrepreneur Magazine just came out with their list of the top 500 franchises in 2016 .  We’ll be taking a look at the five highest performing franchises, analyzing financial requirements and franchisor support.  Franchises are experiencing
twice the job growth rate of small businesses in 2016, so now is a great time to invest and start developing one of your own.  Take advantage of our guide to inform your decision of whether or not to franchise, just remember that best practice is to conduct your own investigation before you invest.  To learn more about entrepreneurship through franchising, attend our free monthly webinar, “Franchise Ownership as a More Stable Career Path.”  Register by clicking on this link, or calling 866-246-2884.

5.  Subway

Subway is the world’s largest submarine sandwich chain with more than +44,000 locations worldwide.  Owned and operated by Doctor’s Associates Inc., Subway is one of the fastest growing franchises in the world, as well as being the largest single-brand restaurant chain and restaurant operator.

4. Servpro

Servpro provides fire and water cleanup and restoration services in the United States and Canada.  More than 1,650 franchises are operating nationwide, making Servpro a leader in the restoration industry as its professionals are available 24 hours/7 days a week to service both residential and commercial customers.

3. Supercuts

Supercuts is a hair salon franchise with over 2,000 locations across the United States.  Supercuts has a wide range of services that includes men’s haircuts, women’s haircuts, kids’ haircuts, color services, and waxing in addition to offering professional haircare products at affordable prices.

2. Hampton by Hilton

Hampton by Hilton, formerly know as Hampton Inn, is a hotel brand trademarked by Hilton Worldwide.  With over 2,000 locations globally, Hampton by Hilton is one of the largest hotel franchises in the country providing a moderately priced, upper midscale hotel service to its customers.

1. Jimmy John’s Gourmet Sandwiches

Jimmy John’s Gourmet Sandwiches is a sandwich restaurant chain that specializes in delivery.  The company currently has more than 2,000 locations in the United States of which 98% are franchise-owned!  There are the #1 franchise in Entrepreneur Magazine for 2016 due to their high average net profit and streamlined business operations.

Financials Comparison

Financial Requirements

Initial Investment

Net Worth Requirement

Liquid Cash Requirement

Jimmy John’s Gourmet Sandwiches

$323,000 – $544,000

$300,000

$80,000

Hampton by Hilton

$3,793,600 – $14,146,500

 

$375,000

Supercuts

$144,400 – $293,800

$500,000

$150,000

Servpro

$141,550 – $191,200

 

$85,000

Subway

$116,600 – $263,150

$80,000 – $310,000

$30,000 – $90,000

Ongoing Fees

Initial Franchise Fee

Ongoing Royalty Fee

Ad Royalty Fee

Jimmy John’s Gourmet Sandwiches

$35,000

6%

4.5%

Hampton by Hilton

$75,000

6%

4%

Supercuts

$29,500

6%

4%

Servpro

$45,000

3-10%

3%

Subway

$15,000

8%

4.5%

Change in Units

1 Year (Units)

3 Years (Units)

 

Jimmy John’s Gourmet Sandwiches

+9.0% (+205)

+22.5% (+514)

 

Hampton by Hilton

+4.4% (+90)

+5.7% (+117)

 

Supercuts

+5.3% (+136)

+8.8% (+225)

 

Servpro

+1.8% (+30)

+4.7% (+80)

 

Subway

+1.7% (+768)

+9.4% (+4149)

 

Operations & Franchisor Support Comparison

 

Jimmy John’s Gourmet Sandwiches

Hampton by Hilton

Supercuts

Servpro

Subway

Training

3-7 weeks

2 weeks

4 days

3.5 weeks

2 weeks

Ongoing Support

 

 

 

 

 

    Purchasing     Co-ops

✔

✔

 

✔

✔

    Meetings

✔

✔

✔

✔

✔

    Grand             Opening

✔

✔

✔

✔

✔

    Security

 

✔

✔

✔

✔

    Newsletter

✔

✔

✔

✔

✔

    Toll-Free         Line

✔

✔

✔

✔

✔

    Internet

✔

✔

✔

✔

✔

    Field                 Operations

✔

✔

✔

✔

✔

Marketing Support

 

 

 

 

 

    Co-op               Advertising

✔

✔

 

✔

✔

    Regional         Media

 

✔

✔

✔

✔

    Ad Slicks

✔

✔

✔

✔

✔

    National           Media

✔

✔

 

✔

✔

    Absentee         Ownership

 

✔

✔

 

✔

Number of Employees Required to run

20

25

6 – 8

5 – 10

8 – 12

McDonald’s Announces New Changes; Big Increase in Refranchising Rates

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McDonald’s has been evolving, mostly due to the leadership of CEO and President Steve Easterbrook.  The company is adapting to changing tastes in the market: more millenials who prefer snack-type food to burgers, an increase in demand for healthy food options, and new competitors in the marketplace, such as Chipotle and In-N-Out Burger.  Easterbrook has said “The corner of our System is our powerful and enduring brand…My priorities for McDonald’s as a modern, progressive burger company are three-fold: driving operational growth, creating brand excitement and enhancing financial value.”  These factors led McDonald’s to announce their turnaround plan in 2015, of which all-day breakfast is the most visible (and popular) manifestation.  An important, but often overlooked part of their strategy is refranchising.  The company has raised their global refranchising target to 4,000 restaurants through 2018, with a new long-term goal to become 95% franchised.

But what is refranchising?  Refranchising is the sale of corporate units (restaurants in this context) to franchisees.  There are lots of reasons why companies choose to refranchise.  Often, a franchising business is more profitable and has lower capital requirements, while remaining insulated from volatility in operational costs and sales.  A component of the increase in profits is that franchisees are better business operators, often outperforming the franchisors they took over from.  Franchisees are ideally situated to succeed, as their only focus is promoting the profitability of their particular location, and they don’t have to worry about the success or operation of the brand as a whole.  Franchisees are often entrepreneurial in attitude, and find more success in business growth and development than managers.

This has big implications for you.  Refranchising can be a very profitable business opportunity for the motivated entrepreneur—especially noting the big trends towards refranchising in the marketplace.  Keep your eye out for juicy deals popping up on the horizon as investors put pressure on chains to demonstrate profitability and pay down debt, causing them to increase refranchising efforts.  If you decide to take on the task of purchasing and running a franchise, remember to keep a few tips in mind. 

Take care to not overpay for a store.  Often franchisors refranchise struggling locations to move them off the balance sheet and make them somebody else’s problem.  Generally, the normal market rate is 4-5.5x EBITDA; ask for financial statements to corroborate a valuation.  Detailed and accurate financial information is very important, make sure you can acquire and evaluate it.

Consider more creative ownership structures apart from asset sales with limited representations and warranties.  For example, some franchisees may want the franchisors to distribute assets as regional entities and do a stock or membership sale.  This can often be more efficient and profitable for the franchisor and franchisee.  There are a lot of possibilities today to find a transaction that matches your business interest, risk, and tax requirements.

Note that different franchisors offer different incentives for franchisees.  Some popular ones are royalty relief, advertising funding assistance, deferring franchise fees during new developments, and offering free training services. These can often be make-or-break perks, so be sure you’re aware of the possibilities.  During the negotiation process you’ll be able to maximize your return from the franchisor.

The most important factor is to confirm your franchisor has a well-developed strategic plan for the future that includes refranchising.  The franchisor-franchisee relation is a symbiotic one—ask important questions like how they’ll be handling corporate stores and how changes affect earnings, use of capital, and their relationship with other franchises.  You can be sure of success with an organization with an informed strategic direction.

McDonald’s has already seen some impressive results from their turnaround, recently announcing a 5% increase in global sales for the fourth quarter in 2015 and an increase of 16% in diluted earnings per share.  Now is a great time to explore franchising opportunities at McDonald’s and other companies. To learn more about entrepreneurship through franchising, attend our free monthly webinar, Franchise Ownership as a More Stable Career Path. The webinar is free, but you need to pre-register, which you can do online by clicking on the linked seminar title.

You may also register by calling 866-246-2884.