MATCHING & FRANCHISOR PROTOCOL Contact Information for Vicktoria White Direct

MATCHING & FRANCHISOR PROTOCOL Presented by Vicktoria White My Background -Franchisor from 2003 to September Franchise Consultant since Started consulting and facilitating new franchise concepts Trainer Prior to 2003 I owned and operated a 10,000 sq ft Wellness Center

WELCOME! MATCHING & FRANCHISOR PROTOCOL What to expect: This training module will teach you about the FranServe franchisor directory, and how to focus your business research efforts to match your candidates personal and business criteria to potential franchise opportunities. In addition, you will learn best practices on working with franchisors to introduce yourself, understand their registration process, territory check and discovery process. Where does this fit into the Placement Process?

FRANCHISE LISTING PAGE Initial Contact & Pre- Qualify Candidate InterviewResearch & Pre- Registration Franchise Presentation Candidate Introductions Coaching ProcessLegal & Placement Key Activities  Initial Contact via Phone /  Establish Rapport & Credibility.  Explain Services & Steps  Handling Common Objections  Script to Pre-Qualify the Serious –vs- Curious.  Become a Business Orchestrator for needed 3 rd Party Sources (funding).  Schedule Interview Call  Confidential Questionnaire Key Activities  Conduct an interview using the Confidential Questionnaire (Uncover tangibles & intangibles). Note: Any partners should be involved in this process.  Explain Next Steps & Schedule Franchise Presentation Mtg  Send Explaining Discovery Process and Disclosure Statement. Key Activities  Match Key Elements of Your Candidate to Businesses.  Research Franchises in FranServe Directory w/ eMatch Tools & Power Search.  Pre-Register Candidate and do a Territory Check.  Request electronic materials from franchisor to use for presenting their business. Key Activities  One at a Time Review Key Criteria & Benefits of Selected Franchises. (total of 3-4)  Feedback & Ranking from Candidate.  Select 1-2 Franchise Concepts to Discover.  Identify Good Times for Candidate Introduction Calls & Set Expectations of Franchisor Process. Key Activities  Schedule Introductory Call for Franchisor & Candidate.  Provide Franchisor w/ any Insight on How to Best Manage Your Candidate.  Identify Questions that Your Candidate may want to ask Franchisor Key Activities  Become that Trusted Advisor & Business Coach.  Remain Involved in Calls between the Franchisor & Candidate.  Set Candidates Expectations about the FDD prior to Franchisor disclosing FDD.  Identify Questions to Help with Validation of Franchisees  Checklist for Discovery Day Key Activities  Lawyer Reviews and Negotiates the Franchise Agreement on Behalf of Candidate.  Franchise Agreement Signature & Payment of Franchise Fee.  Consultant sends placement details: and FS invoices the Franchisor for Placement Fee & Upon Receipt of Fee then Pays  Congrats to You, Franchisor & New Franchisee.  Request Reference

UNDERSTANDING THE FRANCHISE LISTING PAGE The Franchise Listing Page gives you a lot of information about each franchise concept. Information that you will find very useful in selecting and then presenting the franchise to your candidate. Before getting started, it is important that you have a solid understanding of all the items listed on these pages. Highlighted Items: SBA and VetFran Approved Franchises Initial and Total Investment Registration vs. Non-Registration States

5 KEY FACTORS IN LAYING THE FOUNDATION 1.Engage all Parties 2.Determine who will Purchase and who will Operate 3.Determine Location 4.Establish Verbal Communication 5.Identify Intangibles

ENGAGE ALL PARTIES INVOLVED Now that you are ready to move onto the Matching and Presentation phase of the process, it is critical to get all of the parties who will be making a decision involved. It is very common for the Head of the Household or the “Decision Maker” to say that their partner or spouse, doesn’t need to be involved in the process because they are okay with whatever decision will be made. In many instances, this is usually a FALSE statement. When it comes time to write that large check for the franchise fee, those partners and spouses will many times get cold feet because they aren’t familiar enough with the concept and will cause the sale not to go through. This is not what you want to happen. Please note: It is not always possible to get involvement from all parties. Do the best you can and offer more than once, even if it means having a separate conversation with the other party. You have a better chance of getting those candidates to the finish line with the Franchisor, if you are able to engage everyone.

DETERMINE WHO WILL BUY THE FRANCHISE AND WHO OPERATE THE FRANCHISE Before getting to far into the process you will want to determine who will buy the Franchise and who will operate the Franchise. The person buying the franchise and the person who will be operating the franchise may not be one in the same. It is important to establish these roles in the beginning to avoid confusion and possible rejection from the Franchisor down the road. Failure to do this could very well result in the loss of a sale.

FRANCHISE LOCATION In determining the franchise location, it is important to gather not only the zip code, but also the County and City. Reason being is that not all franchises grant territory based on zip code. In most cases your client will want to purchase a franchise that can be operated in his current location. However, don’t assume they want a franchise in their location. They may be re-locating or may want to open a business in the city/town of a friend or family member. After you have confirmed that information, it is important that you have a clear snapshot of the population and demographics of the location that is in question. Many franchises will have a minimum population and income range before awarding a franchise, so be certain to take your client's location into account during the matching process.

VERBAL COMMUNICATION IS THE KEY TO SUCCESS This is an industry where communication is the key to success. Without it, it is very unlikely you will make a sale. Understand that communication is much more than and text messages. It requires verbal communication with your prospect and with each of the Franchisors you will be researching and ultimately working with to make a sale. These verbal conversations will give you valuable information you won’t be able to obtain from a website, or text message.

IDENTIFYING INTANGIBLES No matter how good our cross matching technology there will always be added pieces of the puzzle that you will have based on your initial conversations. Does the client have good language skills, for example? What about education? Telephone demeanor? Seeming intelligence? These intangibles may steer you directly toward or away from a particular category. What about lifestyle issues that your client may have introduced? Some clients only want to make money, while others want to give back to the community. Others may be interested in working in an area of special interest, such as pets, seniors or family friendly businesses. You will have clients that show an interest in traditional businesses, while some may be satisfied with nothing less than the latest fads. Your ability to read and apply these intangibles is important. Franchise matching can be a highly intuitive process, and you are encouraged to use every piece of data that you have gained in your conversation(s) with your client.

Business Preferences & Motivators Business Role, Business Model Preferences, Industry Preferences, Business Criteria Emotional Motivators Lifestyle Change Control of Destiny / Tired of Corporate America Plan for Retirement / Diversification (Invest in Yourself) Pay for Children’s College Helping Others Financial Qualifiers & Motivators Financial Goals & Capability (Assets, Good Credit, HELOC, 401K) Partnership Qualifiers Ready (make a decision in days) Willing (to follow the process & overcome fears) Able (financial health…ready to write the check) MAKING THE MOST OF THE INFORMATION-WHAT IS DRIVING THE DECISION?

MAKING THE MOST OF THE INFORMATION CONTINUED… It’s no secret that people buy from a point of need or emotion (what they perceive they need). They don’t make the decision to spend their life savings or to diversify their investments arbitrarily. The key to a successful sale is identifying what that emotion or need is, and then filling it with a business option that gives them everything they are looking for, don’t forget to include their motivators for business and financial security and growth. It is your job to help them make the connection between these and the business you are presenting.

Candidates Skill Set & Interest: Marketing Sales Customer Services Business Management People Management Finance Administration Project Management Mechanical Working with Hands Facilitation/Coaching Skills Technical Driven to Succeed UNDERSTANDING YOUR CANDIDATES SKILL SET & CONFIDENCE IN SPECIFIC AREAS…

General Profile  Executive for a Fortune 50 Home Improvement Retail Store for 20+ years  Early 50’s and not sure how much longer he wants to work in current job  Needs to diversify his portfolio and investments-In a very high tax bracket  Wants to run passively (will be initially involved and will continue with oversight involvement) Fiance may also participate in the operation of business  Wants a business that he can pass along to his children, if he chooses  Core Competencies in Order of Confidence o Project Management /Business Management o Sales (In order of preference….referrals, networking, advertising, direct sales) o Administration o Marketing o Customer Service Key Criteria for Business Selection (Emotional Motivators & Business Preferences) o Minimum Investment Budget is $100K (flexibility to go higher, if the right concept, net worth is $1M+) o Order of Importance for Franchisor Selection: 1) Investment Amount 2) Lifestyle / Location 3) Maturity & Size of the Franchise System 4) Brand / Industry Type  Top 4 Important Items in selecting a good business: 1)Enjoyment 2) Retirement 3) Net Profit 4)Market Growth / Scalability Industry Considerations  Considering Franchise Industries: B2B or B2C, Home Improvements, Maintenance Restoration, Sports, Training, Labor Mgment Concepts such as Staffing, Maid Services Territory & Investment Level  Check zip codes XXXXX and XXXXX and surrounding areas  Targeting concepts that state initial investment estimated at a maximum of 150K or less. Other Considerations People Oriented, Leader, Motivator Candidate Profile – Male, Age 51, Location- Atlanta, GA

FRANCHISE POWER SEARCH AND eMATCH The Franchise Directory and the eMatch make it easy to find the perfect franchise for your client. Our advanced search functions are a fast and reliable system for eliminating absolute non- matches and steering you toward the categories that will be most likely to produce a good match for your client. To broaden the number of positive responses, enter only those bits of information that are absolutely essential to a meet your client's needs. You can add qualifiers as you go along to reduce the number of potential franchise matches. Selecting the information that your client indicated as most crucial might include a specific category or category exclusion for example.

CANDIDATE WANTS A FRANCHISE NOT IN OUR PORTFOLIO Occasionally you will get a candidate who wants a franchise outside of our portfolio. Don’t panic. All you need to do is look up the contact information on the Franchise, contact their Franchise Development Department and ask them if they work with Consultants. If they do, send them the Referral Form, which can be found on the FranServe website under “Files and Downloads”.

TERRITORY CHECK AND AVAILABILITY The number one mistake that we cannot recover from is presenting a candidate with a franchise, only having to relay to him later that the franchise is indeed not available in his area. People instinctively want what they can't have, and this error will result in the candidate losing confidence in your ability and his lifelong desire to want "the one that got away" regardless of what else he sees. Your franchise partners understand the necessity of availability checks, and will be prepared to accept your call AND to firm up this information. The availability check will also confirm for you that the particular franchise has registered and is for sale in the state in question. If you are using the Client Manager software doing a territory check is fast and easy and will provide you with written confirmation, of the check itself and the response of the Franchisor. It will also serve as a pre- registration and connect your clients name to you. If you are not using the Client Manager software it is imperative that you get your territory check in writing.

MAKING INITIAL CONTACT WITH THE FRANCHISOR In addition to the written territory check (pre-registration), it is IMPERATIVE to give the Franchisor a call to become more familiar with their concept and verbally confirm the territory is available. Take advantage of this conversation to learn other pertinent information that will be helpful in your presentation. Not only knowing if the franchise is available in a given market, it is helpful to know where the nearest franchisee to this market is, what is the expansion potential, how many are open in this state, are they happy? Use this time to get to know the industry and the organization. Discuss your candidate with the Franchisor, to make sure they are what the Franchisor is looking for. If you have any doubts, now is the time to discuss them.

SAMPLE QUESTIONS FOR THE FRANCHISOR Below is a list of initial questions to help guide you through the conversation. 1.I submitted a territory check and pre-registration for my candidate John Doe, and I want to ensure you have the initial information you need. 2.What are you looking for in an ideal candidate? 3.What makes your concept different from the other franchises in your industry? 4.What has been your growth pattern the last two years? 5.How many new franchisee’s do you hope to gain in the next 12 months? 6.If my candidate chooses to go forward with with your concept, how would you like for me to make the referral? 7.What information do you need and in what format? 8.Once you have my referral, what happens at that point and when can my candidate expect to be contacted and by whom? I want to be sure I am setting the proper expectations for my client. 9.Do you have presentation materials or a two minute drill that I may use to make a presentation to my client? 10.What are the commissions paid to FranServe consultants? NOTE: Please be mindful and respectful of the Franchisor’s time.

PRESENTATION MATERIALS-TWO MINUTE DRILL If you don't already have presentation material for this franchise, ask them to it to you during your initial call. You may also find out exactly how they want the client presented to them, and also how they will contact the client after you have turned them over. This information will allow you to set an expectation for your client. The longer you are in the business and repeatedly present certain franchises the shorter these conversations will become. However, the nature of the business is that you will always be making an availability/territory check and asking for presentation materials.

Low Overhead Minimal Employees Passive Ownership / Active Ownership / Absentee Ownership / Developer Ownership Recession Proof / Recession Resistant Any Marketing Statistics Position in market place, Position in franchise world Position in consumer world Industry track record Franchise track record Bottom Line….What is their track record for success (industry specific / franchise specific / both) Brand Recognition Anything unique about Business Concept Operations or Business Model. E.g.: No salary / commission based employees, all cash business/no receivables. Any Franchisor Support Advantages. E.g.: no cold calling, lead generation system, shared inside sales or call center, equipment financing, volume purchase savings, site location assistance, construction & design assistance, accounting systems. Minimal Inventory No selling, customer comes to you. No Cold Calling! Multiple revenue streams Minimal competition Simple product / service offerings (minimal learning curve) Ease of Operation / Low maintenance concept (eg: Food –vs- Hair Salon) IDENTIFYING COMMON BENEFITS

Meets initial investment level Lifestyle business / M-F Operation Hours Scalability / Ability to Grow & Build Autonomy Preferred business environment (Home Based, B2B, B2C) Smaller, Medium, Large Franchise System Franchisor Control Philosophy (more hands-on or hands-off) Advertising Based or Direct Sales Based Trendy, Cutting Edge or Conservative, Consistent, Constant Executive Model allows for you to operate the business –vs- being an operator IN the business (Eg; overseeing the cleaning business, but not doing the cleaning) Provides at Item 19 (Earnings Claim) Item 20 Track Record (healthy system growth) Deep industry experience and a moderately young franchise system Deep franchise experience How does it maximize your candidates background / experience & strengths, whether it be their mgment skills, finance skills, people skills, project management skills, handy skills, etc). How does the business concept meet his / her emotional motivators, such as giving back to community, family oriented lifestyle, etc. COMMON BENEFITS CONTINUED… WIIFM = What’s In It For Me

RELATING THE BENEFITS TO YOUR CLIENT Putting it all together: 1.Used by over 50% of the population 2.Recession proof industry 3.All cash business, no receivables 4.Extremely low overhead. Every employee, including the manager, works on commission. 5.Minimal Inventory 6.No selling, customer comes to you 7.Absentee ownership model 8.Scalable with multiple locations 9.Initial entry under $100K I was able to identify 9 Key Benefits that related to the needs and motivators of my client. These will be the key benefits that you will use to make your Benefits Presentation to your candidate.

Homework: Today you learned how to take the information from your Confidential Qualifying form and put it to use in researching different franchise opportunities. There are a lot of factors involved in choosing the right business for your candidate. Tonight, spend some time going over the different industries and do a mock, Candidate Profile on yourself. You might be surprised, what you come up with. I also recommend getting to know the different industries in the portfolio. Choose a business from each category and start learning the key benefits. Good Luck!