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Tiered VetFran roster aims to help veterans choose


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VetFran has been a force for veterans in franchising since 1991, and now it’s expanding to aim to be more helpful to veterans in every facet of franchising.

The organization, which is part of the International Franchise Association, has created a new tiered star-based system to help prospective franchisees or growing veteran franchisees see immediately the strongest brands with the best veteran perks.

Eric Stites, VetFran’s chairman and CEO of Franchise Business Review, said since the organization was reinvigorated in 2011 as troop levels in Afghanistan began drawing down, member brands ballooned from 60 to more than 650. Since then, more than 6,500 veterans have become franchisees.

ONE STAR LEVEL:

★ Clean audit report
★ Minimum veteran
discount 10%
★ Minimum 2 years
in this line of business
★ Minimum 1 year in
franchising this concept


THREE STAR LEVEL:

★ Clean audit report
★ Minimum veteran
discount 15%
★ Minimum 3 years
in this line of business
★ Minimum 2 years in
franchising this concept
★ Item 19 FPRs
★ 25 units open
★ Participation in one VetFran meeting each year


FIVE STAR LEVEL:

★ Clean audit report
★ Minimum veteran
discount 20%
★ Minimum 5 years
in this line of business
★ Minimum 3 years in
franchising this concept
★ 80% continuity rate over past 3 years (verified by Item 20)
★ Item 19 FPRs
★ 50 units open
★ Participation in one VetFran meeting each year
★ 1 CFE (certified franchise executive) on staff

It was a great showing of support for veterans returning home, but as it continues to mature, the organization seeks to highlight the best brands in the system.

“More and more companies were using the VetFran brand as accountability that they were a good franchise when really there were no requirements for membership,” said Stites. “As a committee we didn’t want to bar anyone from being part of the program, but we established this star program to really identify those programs that went above and beyond.”

The one-, three- and five-star levels each has a more stringent list of requirements. Those with the highest star rating, of course, have the least likelihood of failure, the strongest support structure and the best discount for veterans.  

“The star program really helps better educate candidates looking at franchising,” said Stites. “Not that a one-star company is bad necessarily, but having 50 units open is much different than one.” (See the levels and criteria on the next page.)

The program is tailored for new or prospective franchisees, a group that needs a little guidance. “I think this helps because buying a business is a very emotional decision, so having just any level of criteria with the star program and being able to talk to people more about how to do research on a franchise program helps,” said Stites.

Once a prospective franchisee has identified a few target brands via the star program, VetFran will also continue to give guidance around how to research that first franchise so there aren’t any regrets.

“Quite honestly, I think franchisee satisfaction is probably the most important thing to look at. And we tell candidates all the time to talk to franchisees. They’ll tell you how it is—the good the bad and the ugly,” said Stites. “I’m shocked all the time when I talk to new franchisee owners who never thought to call a current franchisee.”

Stites said the new program is already getting VetFran members to bump up the discount to be recognized at the five-star level, which is growing from about 100 brands, even before the program’s official launch.

The second wave of changes helps bring more veterans into franchising in general, though not at the top. Stites said it’s a common misconception that there’s a flow of veterans coming home and right into their own franchise.

“The number of people who start a business day one is unique, but certainly we want to make them aware of all the job opportunities that franchising provides,” said Stites. “For every veteran that’s bought a franchise, 30 to 40 have got a job in franchising. And we are constantly looking at ways to just get out to educate the military audience about all the employment opportunities in franchising.”

Stites said the new star program will be officially in place by the end of the year.

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