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National Franchise Institute founder aims to fill gaps


First-time franchisees aren’t the only ones who don’t know what they don’t know. Sometimes franchisees with multi-unit development deals get the first unit open and then are too tired, broke or emotionally tapped out to fathom how they could possibly start work on the second or third one.

“You can’t use all the bullets in your gun for the first unit, because you need them for battles with your future units,” said Carolyn Miller, founder of the National Franchise Institute in Denver.

Miller, who started her career helping McDonald’s fit units in Walmart locations, said almost everyone she comes in contact with tells her they wished they’d known then what she was telling them now. Hearing that sentiment over and over is why she started the Institute in January 2015, she said.

Miller’s development experience is from both sides, from large corporations such as McDonald’s and Chipotle, and also working for multi-unit franchisees and an architectural  firm. She moved to Denver after McDonald’s invested in Chipotle, to help open the chain’s corporate units.

Need to know basics

“The franchise model is brilliant,” she said during her introduction for an Institute’s class titled, Essential Competencies for Building Brick & Mortar Locations, in January. But success isn’t guaranteed, she stresses.

One thing she said that surprises her when she’s working with franchisees is they sometimes have no idea they are making mistakes. Her two-day seminars are designed to help fill in the knowledge gaps both firsttime and multi-unit franchisees have, even with the blueprint furnished by a franchisor. “Franchisors teach operations,” she said. “We teach development.”

Miller prides herself on having advice presented by people who currently work in the fields they’re talking about, rather than by consultants. Areas covered in the class include financing, real estate, site selection, legal, accounting, insurance and construction.

Some of the advice is general, such as: Hire a franchise attorney, not a business lawyer, and certainly not your cousin who practices family law. She expanded that cautionary note to include architects and accountants.

If you’re building out a restaurant space, you want an architect who has experience designing restaurants, she said, adding the same is true of accountants. Rules for franchising differ from general business.

Other information is detailed, such as how to do site selection using “economic gardening,” concentric circles and demographic plotting. Experts also addressed common naivete, such as buying a pizza concept because you love the pizza, not the economic model, or selecting a location because it’s near your home or on the way to the babysitter’s.

“It’s convenient to have your business next to your home, because when you go out of business you don’t have to carry your stuff as far,” Wayne Kocina of GeoWize quipped.

The common thread running through the presentations was: For every dollar you spend on the front end, you save $10 on the back end.

“Carry a sense of urgency, so you can bury a sense of emergency,” said Bill Robison of Milestone Management, one of Miller’s guest instructors. Other good tips: Follow a timeline; surround yourself with experts; think of yourself as coach, not quarterback; attract financing before you sign a franchise  agreement; and find out what you don’t know before you need to know it. See how easy franchising can be?

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