Franchise Development – The Definitive Guide

Franchising is an excellent opportunity to expand your company’s brand reach while establishing both new and ongoing revenues. Done correctly, franchising breeds positive outcomes for the franchisor and franchisees. However, it’s important to understand the nuances of being a franchisor, from building national and local brand awareness to awarding locations to qualified franchise candidates who fit your culture. There’s a stark difference between being a national franchisor and a small local business owner. Recognizing and capitalizing on those differences is vital to developing a successful franchise empire.


As a franchisor, your brand strategy has to be relevant to more than just your customers. You also need to appeal to potential franchisees and investors while fostering positive customer reviews and franchisee validation. Also, local success with your branding doesn’t guarantee success on a regional and national level as you expand. Many franchisors forget that their branding must be scalable – that is, their branding must be sustainable, ownable, and compelling, while also being flexible enough to meet the unique needs and locations of your franchisees.

Recognizing that franchise candidates are generally 70% of the way through making a decision before they talk to you, or your franchise development department, is another vitally important part of your branding. While your prospects are doing their research on your brand, are they finding the right things? Are they seeing consistent brand messaging across all of your platforms? Are you utilizing different media to provide unique content that answers their biggest questions?

For example, there’s an increasing emphasis on the importance of franchise video content in brand messaging. Video testimonials, videos sharing stories of your business, videos introducing consumers and prospects to your management team – video content is extremely useful in boosting engagement and can be shared across multiple platforms, maximizing effectiveness and minimizing difficulty.

It’s also imperative to keep brand standards in mind when building your brand. Learning what content to develop and how to incorporate it seamlessly into your messaging can mean the difference between a successful campaign and one that flops because it doesn’t resonate with the target audience (customers and/or prospective franchisees). You need to take the time to develop, understand, and effectively communicate your brand story, what your franchise can offer franchisees, and your unique value proposition.

Marketing – Inbound and Outbound

Franchise marketing is full of copycats. When you built your marketing framework or designed your website, did you emulate your competitors? Did you decide what your franchise should do based on what every other franchise was doing?

If so, here’s the problem: your franchise isn’t these other franchises. Simply borrowing their content structure and ideas won’t serve your brand well. You’ll blend in with the crowd instead of highlighting what makes you a unique and high upside investment opportunity for qualified franchisees.

Rather than starting out with a cookie-cutter marketing strategy or flinging money at PPC (Pay-Per-Click) ads and portals, you and your franchise team should be meeting to create a cohesive and comprehensive marketing plan that fits your franchise and properly shows off your value for franchisees. This is the only way to develop an effective sales funnel that nurtures leads and brings in the franchisees you want.

919 Insights

One critical way to ensure your in-bound and outbound marketing is cohesive and effective is taking advantage of 919 Insights, an AI-powered analytics tool that takes the guesswork out of content creation. Sean Hart, the VP of Sales and Development for American Family Care, says this: “Content is king, but it’s only king if you know where the king is taking you.” It is easy to put a ton of time and effort into your content and into franchise development and see no progress, because the work you’re doing isn’t pointing in the right direction.

919 Insights provides comprehensive content analysis and lets you know what topics are most important to potential franchisees. It gives you the advantage of creating effective content at all stages of the process, establishing brand credibility and making sure all content (blogs, articles, videos, Emails, etc.) is focused exclusively on what’s creating brand awareness and leads for you.

Having a comprehensive, cohesive franchise marketing plan that embraces your brand image and attracts high-quality franchisees to your company is vital to franchise expansion and success. Without time and attention, it’s easy to spin your wheels and go nowhere.

You can learn more about 919 Insights by checking out 919 Marketing’s webinar on the International Franchise Association’s website.

Key Metrics for Franchise Development

It’s easy to only look at the profits being generated by your franchise and see growth as success. If your account balance is growing, your business is booming, right?

While that is true in some respects, simply looking at profits without digging into the deeper layers of business performance will lead to your growth stalling out. Successful business performance and development is about so much more than pure revenue. Are your employees, franchisees, and customers satisfied? Do you have a positive cash flow? If your business depends on deliverables, do you have enough resources to keep it running successfully as you expand? What if a disaster happens (like, say, a global pandemic)? Are you prepared to face that?

Monitoring these KPI’s (Key Performance Indicators) and others will help ensure your franchise development is successful and you attain the growth you’re searching for.

Franchisee Conversions/Leads

We touched on conversions in marketing, but the amount of franchise deal conversions you generate is a truly important KPI to consistently monitor. When looking at your conversions, and potential conversions, you should be checking whether or not these leads are qualified. Do they have the potential to be franchisees? Of the people you have a first meeting with, how many choose to invest in your brand by becoming a franchisee?

When you’re building the candidate experience, you need to keep track of how your website and other owned content (videos, infographics, webinars, etc.) are building emotional connections with franchisees. You also need to be assessing your spend, looking at your budget breakdown, and seeing what your cost per lead and cost per sale average ought to be.

These two metrics are some of the most important to track to ensure that your lead generation costs are reasonable and that you’re generating enough sales from your leads to make your current lead generation methods viable. According to Franchise Update’s 2021 Annual Franchise Development Report, the average cost per lead in 2020 was $312 and the average cost per deal was $12,138. Unless you have strong historical data that proves your franchise development marketing programs are outperforming those figures, this industry data is a good starting point to create a solid budget and evaluate the effectiveness of your marketing efforts.

Comprehensive Planning

Something else that can slip through the fingers of a franchisor is a comprehensive business plan that incorporates all the prior factors we’ve discussed. Franchise development can’t be an ad-hoc process. It takes time and effort to create a plan that will maximize the growth of your franchise.

Your plan should be based on data and should be something you can proudly show to investors and franchisees. It should be something your entire team is invested in and excited to execute. It should maximize your ROI and pull together all the disparate parts of your franchise into a unified whole.

919 LINK® Planning Process

An excellent tool for creating this comprehensive plan is 919 Marketing’s exclusive LINK® planning process. LINK is a strategic planning process that pulls together everyone who’s on your franchise task force to collaborate on a vision for the future of your business. This gives you a pulse check on the major players in your management team and gives them the chance to be invested in your business plan.

With the LINK® plan, you’ll get clear metrics and timelines based on the work you do together as a team. You’ll also get specific cadences for how, and why, you should allocate your budget in certain ways – your cost per lead and expected conversion rate, how much you’ll need to invest in paid advertising, and more. LINK® is the best way to build a collaborative vision for both your marketing and sales development teams that will allow them to best face the challenges and take advantage of the opportunities ahead of your franchise.

Creating a Smart Budget

On the franchise sales side, it is important to consider how many of your qualified leads are converting into franchisees. Do you know your average cost per lead and cost per close? If you don’t have a lead qualifier at the beginning of your process, ensuring that more questionable leads are being weeded out before reaching the application stage, do you know what your ratio of leads to sales looks like? If you are using a pre-qualification process, what does your lead to sales ratio look like?

With qualified leads, the average closing ratio in 2020 was 13.5%. So, if you’re aiming for 12 deals, an average of one per month, you’ll need to get about 90 qualified leads (7-8 per month). However, if you’re only measuring total leads, and focusing on quantity over quality, you’ll be so consumed trying to qualify (or more typically, disqualify) people who aren’t a fit than focusing on people who are a great fit for your brand and culture.

In 2020, the average budget for franchise sales and recruitment was $215,173. Your overall goals should determine whether your budget is higher or lower than that figure and you need to build a scorecard to track your progress. So, for example, let’s stick with the 12 deals goal mentioned above. Based on industry averages, you’ll need to generate 90 qualified leads to meet/exceed the goal.

Once you have those baseline goals, you should set your budget based on the percentage of leads you expect to be qualified. In our experience, that figure is typically between 10-15% for most franchise brands. So, to generate 12 deals at an industry average of $312 per lead, you should expect to spend somewhere between $187,200 (600 leads/15% qualified) and $280,800 (900 leads/10% qualified). And that is the cost only pure lead generation efforts, not any other marketing overhead such as staff, content writing, website expenses, collateral, lead nurturing, etc.

One of the biggest mistakes you can make as you work to expand your franchise is not having enough money and resources to support new franchisees. Many new franchisors miscalculate the amount of time, effort, and money it takes to support franchisees through the first few months of business and assume that initial fees and grand opening dollars paid by the franchisee will be sufficient to help them thrive. Systemwide program margins will suffer, and future growth will be stunted due to poor validation, if new franchisees entering your system aren’t receiving the support they need to become successful.

This may feel overwhelming – as a franchisor, you’re passionate about your company, your product or service, and your goals. However, you can’t be an expert in everything. That’s why 919 Marketing is here to help you through the comprehensive planning and sales lead strategies that marry your sales and marketing teams in a unified business approach.


Whether you’re starting your franchise journey or already own several franchises and are working on further expansion, it’s important to recognize that there is no one size fits all, golden ticket method to franchise development.

Every franchise has its own unique brand values and perspective, marketing strategies and content, and development goals. Capitalizing on these differences will help your franchise stand out from the pack of thousands of franchises appealing to potential franchisees. If you take the time to successfully create and implement a brand strategy, marketing plan, and sales funnel, while monitoring your KPI’s and assessing your budget and effectiveness, you can experience nearly unlimited growth and profit potential.

If you want to discuss more in-depth what franchise development strategies can do for you, get in touch with 919 Marketing today.

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