It was a question that got asked last week by a potential franchisee, thinking about joining one of our clients.
Generally, I would say, no. It’s not possible to be too successful… because if you’re too successful it means you’re unsuccessful! If you see what I mean, although I’m not 100% sure that I do.
Let me explain.
I think it’s possible to grow too quickly and to acquire too many customers in the early stages of a business.
As part of the process of joining a franchise operation you will complete a plan. It will show steady growth, probably increasing over time. But, as Eisenhower once said, plans are useless, planning is essential!
Very rarely does real life reflect the plan exactly and I’m reminded of two franchisees I’ve had the pleasure (and I really mean that, they are great guys) of working with.
About three years ago a lady joined a cleaning franchise I was working with. The plan said that the business should grow by ten clients a month and to generate those ten clients there was certain marketing that had to be done.
The lady in question followed the marketing plan precisely. In her first month she came back to a review meeting with twenty two clients. She was delighted; what a great start to her business. She was out cleaning (which was never in the plan) because she was a bit behind on her staff recruitment, but it was a nice problem to have.
When she came back at the end of her second month she had fifty eight customers. Now the situation had changed. She was tired because she was still out cleaning. She had no time to recruit more staff because she was cleaning and she was beginning to lose control of the business. In fact, she looked terrible – with a slightly manic edge to her manner.
She didn’t come back for the third development day. She left the franchise because she couldn’t cope with the business.
When I really thought about what had happened (forgetting for the moment that the franchisor should have stepped in earlier to help when her predicament was flagged) it was obvious. The business had grown faster than her ability to run it. Because of the super fast customer acquisition rates our friend didn’t have time to learn about the business and put in place the infrastructure that was needed.
Later, I was speaking to a guy from a different franchise. He grew very quickly, too. He told me that he struggled at around month six, not because he had trouble recruiting clients – he said that it was administration that almost brought him to his knees.
Fortunately he grabbed his business by the scruff of the neck, got through it and is now running a fantastic (and profitable) business.
It just goes to show that when you are selecting a franchise operation to join you should look at the total system, including the admin and financial controls as well as the product, marketing and sales processes.