January 5, 2017 by Speakers' Spotlight
Three Lessons I’ve Learned About Building a Franchise Business
Zane Caplansky was born to own a deli. Now one of Canada’s most successful and well-known restaurateurs, Zane’s path to smoked-meat success was a haphazard one. With jobs along the way that included acting as a political assistant, becoming a business consultant, and owning an e-learning dot com, it was his insatiable craving for the perfect sandwich that finally saw him shifting his course to realize a dream he wasn’t completely aware he even had. Sharing his inspiring story of how he found and followed his passion, Zane helps audiences ignite the spark of success in their own lives.
My journey from running a corner deli to rolling it out as a national franchise brand has meant about two years of preparation and hard work. Mistakes and setbacks happen. Everything takes longer and costs more than expected. That’s part of the fun. And the reason for so much of my grey hair.
Franchising was a choice. I could have opted to open and manage my own chain of delis. I chose franchising because I believe ownership in the restaurant business requires a certain kind of person who loves hospitality, and that is integral to who they are. While managers are terrific, most tend to only be committed during work hours. But franchisees are committed 24/7: That desire to provide a first-class experience for the customer visiting our restaurants, together with a vested interest in the successful operation of the restaurant, is a very powerful combination that comes from franchising. Owner-operated locations need to have the same kind of commitment as I give.
Here are a few things I’ve learned on my franchising journey so far.
1. It’s still all about people
Finding, hiring, training, compensating and retaining the best possible talent is one of the toughest parts of the restaurant, or any business. It’s no different in franchising but it certainly requires a different skill set: Finding people who are motivated to learn and grow with you matters more than just experience.
From collaborating with professionals like lawyers and accountants to dealing with supply-chain issues, team building and operating the store, being able to engage with others is critical.
Another way to think about the importance of people is how they relate to a brand. As a franchisee, you’re part of building and expanding a business – and a brand. Almost anyone can slice deli meat – but creating an experience that keeps people coming back is about more than a product. It’s so important that our franchisees embody the brand, as they’re the leaders who will guide their teams to bring it to life in every possible way.
How? Understand the brand’s values. Understand your customers and how they relate to those brand values. In the case of Caplansky’s, we are “untraditionally traditional” – celebrating homemade family traditions and old deli charm with a modern approach that appeals to a younger and hipper demographic. Bringing the Caplansky’s experience to life authentically across all our franchises is an active investment, requiring constant engagement with everyone the brand touches.
You also need great advisers to launch a successful franchise. Some self-awareness is helpful here to know your own strengths and weaknesses and to look for others who help fill in the gaps. I’ve found these relationships are some of the most rewarding in my life.
2. Expectations are (almost) everything
Expectations are critical. The most obvious and most difficult question from a prospective franchisee is: “How much can I make?”
This one sends the lawyers and accountants into a tizzy – no one knows what the future will bring. There are no guarantees or promises besides death, taxes, and that I will spill on my shirt. And while anything is possible, if you mislead someone, you’ll be liable.
Never mind the paperwork part of franchising, expectations are critical in all relationships. They set the tone and ground rules. Everyone comes to the party with their own values, ideas and experiences. Words can have vastly different meanings to different people.
Yet we need a shared understanding of critical concepts such as the importance of health and safety as well as values such as “the customer comes first.” The question is: How do you know if you’re on the same page? Simply put, it’s all about communication and consistency.
3. Strive for operational excellence
Teaching operational excellence is very different than being an excellent operator. The support of my cousin – executive coach Betsy Jacobson – has been critical in helping me teach our owner-operators how to recruit, train, compensate, motivate and build their businesses.
Scenarios are a powerful tool to help a prospective franchisee or employee understand the Caplansky’s Deli culture and vice versa. How we respond and resolve inevitable conflicts will be important to the overall success of the business.
For example, what would you do if a guest is unhappy that their soup was cold? How would you deal with a staff member who is usually a top performer but then starts to show up late to work? What if a catering order arrives late and the customer is livid?
The possibilities are endless. But the responses to these scenarios need to focus on the values or expectations you’re looking to develop. In discussing them and sharing possibilities we will establish a solid base for a continuing relationship and avoid future conflict.
Fortunately, technology allows us to adapt our training tools so they can be accessed anywhere at any time. Using YouTube we deliver training that builds accountability into our culture. We can give people training scenarios to solve and real-time feedback. And when stuff goes wrong – and it will go wrong because stuff is like that – I need to be prepared with effective fixes and appropriate advice.
The DNA of operational excellence includes “The Hospitality Gene.” The franchisee needs to share my values and passion for food and service. I love nothing more than being in the restaurant serving guests. I expect the same of owners and operators of our franchised locations. If franchisees see this as a passive investment, they are better off in bonds or stocks.