Franchise Talk

Trust part of franchising strategy

June 18th, 2007 | Author: Jack

When Gus Schuberth hired his first employee to help coat garage floors, he didn’t let the worker even hold a roller brush for the first month.

“I did not want to let go. That was scary for me,” said Schuberth, a self-proclaimed perfectionist who with his wife, Pamela, owns Floorguard, an Aurora-based garage floor coating company that also provides garage organizer systems.

With 16 employees and franchises in three states, Schuberth has conquered his fear of delegating. But he’s still plenty picky. “There were times when I’d finish up a floor and decide it’s not right. It could be better. So I’d tell [the customer], ‘I’m coming back tomorrow,’” he said.

The company also is particular when selecting employees and supervising their work. “We don’t want callbacks,” said Pamela Schuberth, vice president. The pickiness extends to franchising too.

As with hiring, being selective in awarding franchises is a good strategy, experts said. It’s easier to avoid problems through a careful screening upfront than it is to correct mistakes later, experts said.

Franchising has become a popular expansion model, with more than 760,000 U.S. franchised businesses generating more than $1.5 trillion in revenue, according to the International Franchise Association, a Washington-based trade group. But not all franchisers are as selective as they should be, and the mistake can lead to failed franchises and a tarnished brand image, experts said.

“When he says he’s picky, that’s very smart. If you get into a 10-year contract, that’s like a marriage. If they’re going to be married, don’t you want to make sure you get along?” said franchise consultant Dick Rennick, past chairman of the International Franchise Association and a former franchiser.

Before awarding a franchise to someone, Rennick recommends holding a “Discovery Day” where franchisers and franchisees can get to know each other and explore a potential business relationship.

With a service business like Floorguard, where franchisees may need to get their hands dirty, Schuberth is steering clear of those interested in a financial investment only. He needs a hands-on owner-operator who isn’t afraid to strap on cleats and coat garage floors, he said.

Read On