Mark Vandegrift 
Welcome to the latest episode of FranSimple, the podcast designed to make the concepts of franchising simple. I'm your host, Mark Vandegrift, and with me is the all-time amazing franchising expert, the president of FranSource, and my franchise brother, Steve Vandegrift. Steve, welcome.

Steve Vandegrift 
Thanks, Mark. I'm really excited to discuss today's topic because I can't tell you how many prospective clients ask, so what makes FranSource different than all the other franchise development companies?

Mark Vandegrift
Yeah, there are hundreds of consultants, brokers, attorneys, development firms. They're all involved in franchising. From your perspective, what should business owners understand before selecting a franchise development company?

Steve Vandegrift 
Well, I think one of the biggest misconceptions out there is that all franchise development companies do the same thing. We all use the same let's say buzzwords, franchise operations manual, franchise disclosure document. In reality, many firms they focus or specialize in one area and really there's four key areas. The legal side, the sales side, the marketing side, and certainly the general consulting side. And I believe that successful franchising, all four systems, they need to work together. And what business owners should evaluate is whether a firm can help build a complete franchise system rather than simply deliver a few individual pieces.

Mark Vandegrift 
Well, you know, a lot of times when you're talking to prospective businesses that want to franchise, we're trying to convey to them the gazillion things we do. We have the same problem as an ad agency that's full service, right? They want to know what all we do and it's more of what we don't do is an easier list to provide because I always say if it has a surface, if there's a screen, if it's something consume, whatever it is, you're going to need marketing services and we provide those. Same thing goes for FranSource because we refer to it as a one-stop franchise development consultant. So give us a sense, if you can, because I'm sure it's a huge list, of what does that actually mean service-wise, and maybe compare and contrast it with some of the other options that franchise prospects have.

Steve Vandegrift 
Sure. And so when we say that, we're basically saying that we provide comprehensive franchise development services all under one route. Now, certainly, our attorneys, they're third-party providers. We have a few preferred attorneys that we work with, but we still work hand in hand with them throughout the development projects. So we believe it's so important that every aspect of the franchise operation it needs to sing off the same song sheet. So the FDD, is it consistent with the operations manual? Is the marketing material is the franchise sales process. So we actually customize every aspect of the franchise operation to fit the client's business. That includes the franchise operations and policy manual, franchisee and employee training programs, the franchise sales process, the franchise CRM system, and certainly other technology systems. And then, of course, the franchisee and local marketing strategies. So we also coordinate, as I mentioned, the development of the franchise disclosure document in conjunction with our franchise attorneys, and we even assist our clients in determining the terms and provisions of the FDD. That's so vitally important. Clients trust our 30 years of experience. And so we're able to advise them concerning what's the territory look like? How are we going to set up that territory criteria? What should the franchise fee, royalty fee, advertising fees be? We're advising and assisting all throughout that process and again with the FDD in conjunction with our attorneys. And so rather than clients having to coordinate with multiple suppliers or vendors, we help guide every aspect of the franchise development process from the concept to the launch of the franchise and beyond.

Mark Vandegrift 
Good. Yeah, many other companies, I guess, develop franchise development consultants say they do this or they do that, and then they hand over like a templated thing and say, here, go fill it out. And I would almost like to say it's not hand holding, but it's walking them through the process. So let's compare and contrast the term customization, because I can say that I'm giving you a customized franchise development process. Well, all it means is I have my own template that I'm handing off to you, and you're doing your own, you know, work in that regard. So, how does FrancSource approach customization differently and give our listeners a sense for really what that means walking alongside them?

Steve Vandegrift 
Sure. And you're right. Unfortunately, there are many, many firms. They rely heavily on templates and what I call one size fits all systems. We believe every business is unique and every franchise system should reflect their uniqueness. Our philosophy is really that a restaurant, a home service company, a fitness concept, whatever, shouldn't be built using the same blueprint. And when the same blueprint is used, we see those results firsthand. I mean, each year we engage with clients that previously work with a different franchise development firm. And they typically contact us after granting a franchise or two. They've walked them through this training program, and they realize that their business is not even reflected in their operations and policy manual. It doesn't address every aspect of the franchise business, certainly relative to both the development, the opening, and the ongoing operations. So basically, there's no substance to the manual. And so they come to us, we do a review of their manual, we also ask them for their franchise disclosure document, they're always a little surprised. They say, sure, we'll share it, but why do you review it? And I explain that the franchise attorneys typically cross-reference the franchise operations manual 72 times in the document, in the FDD, the franchise agreement. Because otherwise, that agreement wouldn't be 60 pages, it would be 500 pages. And so we do a thorough review for the franchise operations manual references. We'll look at their existing manual, and if there's 72 mentions in the agreement, we'll find maybe one that's actually in the operations manual. And that creates an environment where either the franchisee is going to do whatever they decide they should do, or you're constantly, as the franchisor going to get phone calls, texts, emails, et cetera, saying, Hey Steve, I don't see this in the manual. How do I handle this? So it's so critical that there be a complete system when you begin offering franchises.

Mark Vandegrift 
Okay, well let's get down to the nitty gritty, if you will, because that is a good place to figure out what makes FranSource different than all the other franchise development companies. One thing that stands out on the FranSource website is we really put an emphasis on operations. Why is that so important?

Steve Vandegrift 
Well, operations ultimately it's the foundation of successful franchising I mean, I think many entrepreneurs initially think about the end goal, selling franchises. But in reality, it starts with documenting how to consistently duplicate the business model across the franchise network. If franchisees can't replicate the customer experience, the quality standards, the products or services, the operational procedures, obviously growth is going to be difficult to sustain. And that's why we spend a lot of time helping clients develop comprehensive operations and training systems before focusing on franchise expansion. We'll get to that point, but let's make sure we have everything dialed in first.

Mark Vandegrift 
Yeah, it's funny. You did say that franchisees, they they're so focused on I'm gonna start selling franchises, and they skip over the operations. But let's talk about franchise sales because we do help our franchise clients sell. How does FranSource, though, again talking about differentiation, how does FranSource differ from firms that simply generate leads?

Steve Vandegrift 
Well, certainly lead generation is one piece of the franchise development process, but we help clients build an entire franchise process. And what that means is we're going to help them determine how to identify the ideal franchise candidates, developing the sales manual, the forms, the materials, the CRM workflows, and the system. We also advise them concerning the franchisee qualification system and the discovery day process when prospective franchisees will come visit the franchisor. Then we also provide comprehensive support during the initial franchise sales process to help new franchisors, we like to say, learn the art and science of franchise sales and how to effectively generate, evaluate, and qualify candidates. We give them a system so that they have a consistent approach to vetting prospective franchisees. That's so vitally important. And then for some of our clients, you're right. They actually have to ask our us and our senior consultants to initially do the follow-up and follow-through. We call it outsource franchise sales, and we're always happy to do so. And what they want to focus on is the training, the support, and all the other aspects of really making sure that they're totally supporting each new franchisee.

Mark Vandegrift 
Well, overall, that sounds like a lot of stuff. And I think we can sum it up in the sense that we're helping them build each of these items along the way.

Steve Vandegrift 
Systems. That's right.

Mark Vandegrift 
And they get to the end, and there's this huge amount of infrastructure in place that makes their job much easier to do to be able to expand through franchising. One of the comments that we get very frequently at the end is many of these new franchisors go, Holy cow, I can't believe how much infrastructure we built. And we know that's what's needed behind the scenes. What are some areas that you would say business owners don't typically anticipate the most?

Steve Vandegrift
Well, I believe many prospective franchisor they underestimate the importance of systemizing the entire business. We deal with on entrepreneurs every day, obviously. And entrepreneurs oftentimes when we start this process, they say, Well, won't they just figure that out on their own? I figured it out on my own. Well, again, franchisees are franchisees because they trust they can be successful business owners, but they want that business in a box. They want to know that all they have to do is plug and play and they're going to be successful. So prospective franchisors, they may think about the franchise agreement and the FDD, but they often overlook things like franchisee onboarding. I mentioned CRM systems, the training programs, the support programs, the communication programs, the marketing plan. What are we going to do on a grand opening and local marketing? And then of course that franchisee training and support systems. So, really, successful franchising requires a complete, I'm gonna call it ecosystem that totally supports the franchisees. And that's where a lot of our work occurs, really educating our clients as to what that looks like and the process that we need to go through to make sure that it's totally dialed in.

Mark Vandegrift 
Yeah, I think what you're touching on there is really important because we see some of these other firms that are out there, these consultants, the attorneys, et cetera, the list that you went through, they just primarily focus on their one aspect that they do real well, whether it's legal or something else. But beyond getting that business in a box, we're also all about launching them, you know we always think about failure to launch with teenage kids or getting kids out of the house. We can build business in a box, but if we don't do anything to help them launch, there's no innate ability for that franchisor to go, okay, now what? Right? And if the other consultant is just giving them the business in the box, now they have a great concept. They've paid a lot of money, but it's just sitting there. Why do you think FranSource, where does it excel? And why does it focus so much on that launch and launching successfully?

Steve Vandegrift 
Well, first of all, I think it's important to realize that creating a s a franchise company in operation and launching a successful franchise opportunity are definitely two different things. And if you don't get the first part right the second part isn't going go occur. And certainly getting the legal documents, the operations manual completed is important. It's really only the beginning. So our focus is helping clients prepare for what happens after all of these beautiful documents have been drafted. Things like you know, recruiting franchisees, training them, supporting them, and growing the brand responsibly. We want our clients to be successful right out of the gate and long after the initial development process is complete. So we do things as an example, we introduce our clients to third-party companies that support franchisors. That might be technology, it might be site selection. We help our clients launch as if they already have 50 franchises in terms of their support, their training, etc. And so that is how we believe we develop successful franchise companies.

Mark Vandegrift 
Well, you've been doing it for thirty years.

Steve Vandegrift 
Yeah, we got a couple of years under our belt. 

Mark Vandegrift
So you got a you got a little bit of experience. 

Steve Vandegrift
And every day it's a new adventure.

Mark Vandegrift
Well, speaking of that, what lessons have you learned from you know being in business thirty years?

Steve Vandegrift 
Ha, great question. I'd say the biggest lesson is that the quality matters more than the speed of the development. It does take some time. We tell clients on average it's going to take four to six months. At least three months of that is going to be spent just on the operations and policy manual, developing the franchise sales system, et cetera. And businesses that take the time to to really develop and build those strong systems and recruit the franchise, the right franchisees, they tend to dramatically outperform those that are fully solely focused on speed, on rapid expansion. I believe sustainable growth almost always wins over aggressive growth. That philosophy has guided our approach from the beginning and the success of our clients I really believe is proof that our development process, our system, it works.

Mark Vandegrift 
So it's the hare and the tortoise approach, right?

Steve Vandegrift 
That's right.

Mark Vandegrift 
Good. Well, I know you practice what you preach in terms of vetting your, you know, what you would take on as a client. You have done that ever, you know, ever since you started. And we do the same. We want to vet clients that we think are agency ready, we call it. And you would say yours are FranSource ready. Why is it that you limit the number of clients you take on? What's the thinking behind that?

Steve Vandegrift 
Well, it's really because franchise development is highly consulative. We have to spend time with clients. And I personally want to be involved, intimately involved, in every client's development process. In fact, I always tell clients that nothing leaves our office without me doing a final review. Even our attorneys, they first send me the franchise disclosure document. They know I have 35 plus years experience in franchising. And so they also realize that there's certain things that I might want to tweak or suggest, et cetera. We ultimately believe clients deserve direct access to the experienced professionals throughout the development process. And that's why I'm so involved with each client. And so we can only accept so many clients each year. So by limiting a little bit the number of projects and the number of clients we accept, we're able to provide much more personalized guidance. We're going to maintain quality standards. And we really want to be true partners in our client success rather than simply being a vendor. And our clients get it. We've had clients, though, their testimonials is Steve treats us like he's a partner. His team treats us like they're partners in our success. And that's really the most important thing to us.

Mark Vandegrift 
You know, you really start off the whole process with vetting in mind

Steve Vandegrift 
We do.

Mark Vandegrift
because on the FranSource website we have the fifteen question filter, you might call it.

Steve Vandegrift 
15 questions quiz, yes.

Mark Vandegrift 
And you know, prospects probably go through that. They don't realize that we're already measuring whether or not they would make a good, you know, a good client for us, but also whether their franchise would be successful. Maybe talk about where did your 15 question quiz or questionnaire come up? Like what was the genesis of that? And how is it done over the years in terms of vetting your clients?

Steve Vandegrift 
Well, it's interesting. We just had we're talking with a couple prospective clients now and both of them really appreciated that we cared to be able to help them truly evaluate whether they should franchise their business. Is it the right concept? Is it the right time? Do they have the right management team in place? Are their unit economics strong? And so they're pleasantly pleased to find that first and foremost, we want to help them make that decision. And we've had to basically share with prospective clients that based on this, this or that, we really feel you need to work on this before you consider franchising, we don't want to create failures. We want to create success. And so ultimately that begins at the very beginning. And then we'll review profit and loss statement. We'll review business plans. And this is without cost to our prospective franchisees. We feel the investment is worthwhile for both the client and us in terms of our time to make sure that they make the right decision. And we also make sure that they're the right fit for us.

Mark Vandegrift 
Well, for someone that would be evaluating franchise development firms, so someone visits your site, fills out the fifteen questionnaire quiz, and makes contact, what questions should they be asking you or any other development firm?

Steve Vandegrift 
Yeah, that's a great question. And there are a number of questions. First of all, who develops the franchise disclosure document? Who develops the operations systems and the franchise operations manual? Is it a bunch of junior execs that are following a template? Or is it people with 25, 30 years of experience? Another is do you and who develops the franchise sales process? We've had a lot of clients come to us again because of an operations manual is deficient. Other times it's been the operations manual is deficient, and they basically have no franchise sales process, even though the company says, Hey, we're going to develop your franchise sales process. And I've literally ended up asking these prospective clients, well, did they even give you a franchise application? The answer is no. You know, we're delivering a hundred-plus-page franchise sales development manual with scripting and frequently asked questions, it basically outlines from point of contact to literally signing the franchise agreement. So that's the type of thing that they should be looking for. Another is what support is provided after the launch. Under our full development program, we're staying involved with our client with our clients through the grant of the first five franchises. Again, we want to teach them the art and science of franchise sales. We also want to validate the franchise sales process that we've developed. Do we need to add an additional step. Is this step we find not necessary? And so that's the other thing that we're able to do with clients. And that's all included under our development fee structure. I would also ask, is it customized? Are all these materials customized? You know, certainly the FDD, between attorneys, you know, termination provisions, et cetera, they all pretty much read the same. But a franchise operations and policy manual, it better be the Bible of your business. And so another one that I certainly would ask is. How involved will the senior consultants? Are there senior consultants? Are they going to be involved in the project? There's companies out there that they bill all these experienced ex-McDonald's executives, etc. And I've met those individuals at trade shows. And they admit that the only thing they do is they go to trade shows. They're not working on a client's project. So are their senior franchise consultants with a ton of experience, are they gonna be involved in the process? At FranSource clients only work with team members who average 25 plus years in franchising. They're not going to deal with our junior executives. Those are our operations manual drafters, et cetera. They're great at writing operations manuals. They've done it with us for many, many years. But we're not necessarily going to throw them at the client. They're going to be maybe involved when we're going through the drafts of the sections, et cetera, so they can make any necessary changes, but they're not going to be advising our clients in best practices. Another one is can they help with marketing and franchise recruitment? What do they do for that? And then what happens after the first franchise is sold? I mean, to me, the answers to these questions, they're going to identify the differences between franchise development firms. it's also why we conduct our franchise development presentation with prospective clients. The presentation allows us to take a deep dive into our franchise development process and services, and we're actually sharing project deliverables with them. We have wonderful clients. Everyone had gone through this franchise presentation and they come out the other side and they always say, look, you're welcome to share some of our materials if you're you feel they're beneficial to that client's type of business, so they can get the sense that we got, which is you totally FrancSource customizes every aspect of it. It really ultimately it'll help them understand the key questions that they need to ask every development firm that they're considering. And we love to hear when they say, hey, I'm talking to five or six different development companies. That franchise presentation is gonna help them, and they've admitted it, it helped them vet these other providers. And just about every single one of our clients will end up saying the franchise presentation was a key reason that we had elected we elected to engage with FranSource.

Mark Vandegrift 
Good. I love that. That's like let's put that in a in a blog and they can just lift that and go ask all these other companies what they're doing.

Steve Vandegrift 
Great idea.

Mark Vandegrift
So what type what type of business tends to be the best fit for FranSource?

Steve Vandegrift 
Well, we obviously work with all types of businesses and industries, and certainly one client is always the first in that industry and that's okay. We like to say our job is to know the questions to ask, and then we're gonna help you answer all of them. But in general, we work with we'd like to work with businesses that have proven operating systems, strong unit economics, and certainly leadership teams that are committed to building a franchise system the right way and supporting their franchisees. We also prefer, honestly, working with clients where the owner-owners are involved we'd like them to be in the involved in the development process because they're the ones that had the vision, the drive, the passion to build a successful business. And we believe that their input is vitally important to developing a robust franchise operation.

Mark Vandegrift 
Okay, well we're gonna wrap up now. So you get to do one thing, remember, at the end of each of our episodes. And this one thing is around franchise or yes, around franchising, but focused on what we do with positioning. And you get one thing that you're allowed to summarize for us. So summarize the positioning statement for FranSource in one sentence. What would that be?

Steve Vandegrift 
Wow, wow, I like this one. I would say we help clients build robust franchise systems that are designed for their and their franchisees' long-term success. We don't just help them become franchisors, we teach them what it means to be a franchisor. I also want to add, which is extending this a little bit, we really do care about our clients and their success. So our goal is to create a franchise organization and operation that can scale successfully by integrating all the important aspects: the operations, the legal, the sales, the marketing, the four legs to the stool, so to speak. And we want to create one cohesive strategy where every aspect of the franchise operation it sings off the same song sheet. That consistently consistency and systemization is so critical.

Mark Vandegrift 
Well, as usual, great insights today, Steve. I think today's conversation highlights an important lesson for any business owner that might be considering franchising. and that's not that's that not all franchise development companies approach the process the same way, right? So I think building a successful franchise system requires much more than legal documents, right?

Steve Vandegrift 
Right.

Mark Vandegrift 
So that would point to attorneys or franchise sales, which might point to a more of a broker type system there's this huge infrastructure in the middle that's critical that requires thoughtful planning, strong systems, consistency between the various components of the franchise operation.

Steve Vandegrift 
Big time.

Mark Vandegrift 
And of course, a partner like FranSource who understands the entire life cycle, which I think is the blind spot of pretty much every other franchise development specialist. So, anyhow, well let's wrap up today's episode of FranSimple. Thanks for joining us. And as always, please like, share, and hit that subscribe button to FranSimple, the podcast designed to make the concepts of franchising simple. And until next is until next episode, may your business expand through the power of franchising.