“No company stays in business for long if a large chunk of its sales force consistently feels ignored and unrewarded” says Dave Kurlan of the Objective Management Group, a sales management consulting firm. Each sales force is a mixture of high-powered producers, average performers and a few laggards who perpetually bring up the rear. Every sales manager dreams of a sales force of stars, but rarely do the high producers make up more than 20% of even the best sales force. A sales incentive program cannot afford to ignore the middle to low producers who make up approximately 80% of the sales force. This group can post dramatic gains when properly motivated. In fact, an incentive program geared to the top producers can actually demotivate the middle level. Many experts say your incentive program should target the middle producers.
Consider:
A well-crafted motivation program keeps incentive rewards within reach. Don’t spotlight rewards that are simply beyond the reach of the 80%. A $50 gift certificate will look pretty pale when compared to a new BMW.
Plan for regular communications, the value of an incentive program lies in its ability to focus attention and effort on reaching quota. This means constant communications to keep the rewards top of mind.
Remember to have fun. The members of your sales force face the grim reality of a competitive market place. They should rejoice in the joy of meeting a challenging goal.
If we can help you develop a program that motivates your staff in the right way, please be in touch.
In this article, I will cover the two essential prerequisites for forming your independent franchisee association, and the three necessary tools to grow your association.
The prerequisites are a correct name and the right by-law structure.
The three tools necessary to grow the association are: data collection, communication and a public website from which you can attract vendors and members.
I have used these basic tools for over 15 years, growing and assisting with the growth of a number of franchisee associations, including Hardee's and Curves. And the IAFD can help you grow your own association with these three tools.
What's in Your Name?
There are many details that you are certainly considering as you put your Association together.
Before you can incorporate or develop a logo or any other documents, you will need to decide what to call yourselves.
There are some small but rather important distinctions in this process. My advice is to call your Association of [Franchisor Name] There can be no subsequent arguments by the franchisor if you just truthfully name yourselves.
An example would be that you are not the '[Franchisor] Franchisee Association' because [Franchisor] had nothing to do with your formation. However you may be an 'Association of [Franchisor] Franchisees'.
What's the temperature outside?
Do you know how your potential constituents ('customers') feel about forming an Association and are they on board? If you don't, you need to do the best you can to find out.
There are two different strategies here: One is to fill a need that you know already exists and the other is to convince your 'customers' that they have a need and you can fill it.
Knowing this will go a long way toward determining your ultimate strategy. Again, this is an area in which the IAFD can assist you.
The Devil is always in the details.
Your attorney may have great sense of many of these details, such as incorporation, by-laws, operating procedures etc...
None the less you will need to form sub groups from your steering committee to make certain determinations if you haven't already; such as where to incorporate, how to incorporate, what is the structure of the Board of Directors, classes of membership, dues, mission, etc...
Having been through this myself, I am willing and able to advise you on many if not all of these things.
"Zero to one thousand".
Your goal of the Independent Franchisee Associations is to reach out to as many franchisees in your system as possible and get numbers!
This is the most powerful way to create a constructive dialogue with your franchisor. When you represent a thousand locations or more, it is difficult for the franchisor to employ the 'divide and conquer' strategy.
Once you have numbers and you position your Association as an asset, your influence will increase. How do we do this?
This may sound over simplified, but as I stated before the devil is in the details. There is a three pronged approach that works every time it has been tried.
All three prongs need to work in synchronically
1. Data, data, and more data
The more you have the more effective you will be. Capturing and maintaining that data base of members can be a nightmare for startups and volunteer groups.
The IAFD has a partnership with a group that can help you not only with tracking membership, but also setting up events etc.
We can get you set up and started in a matter of days.
2. Communication
Regular communications to your members is a key driver in attracting and retaining membership. The IAFD currently has a deal with an electronic newsletter that is state of the art.
Again, that can be set up in a matter of days. One of the benefits you will receive is my experience as a part time Executive Director for you until you can or want to hire one full time.
I will help you publish this newsletter with the content that you want as long as you would like me to.
3. Public Website
It is critical that the membership can connect between the other two prongs back to the website!
The IAFD can build a start up website for you and expand it as your needs grow.
When you achieve financial independence, you are certainly welcome to shop for a website of your own. As a start up, this a great value to you.
If you have done any due diligence, you probably have found that the cost of building a site can run from 5k to 25k plus maintenance.
Why did I title this section 'Zero to One Thousand'? Because by employing these simple steps and maintaining them daily (again an IAFD function) we have shown that you can build your membership representing One Thousand units in less than a year.
Where's the Money?
This is always the conundrum of start up Associations.
There are several ways that you can actively pursue start up capital.
If your base knows that they need this, you can ask for start up monies which could be deducted from dues later or not.
Begin thinking right now about any and every vendor that touches your concept either directly or indirectly. There is money to be made with vendor programs
Dues. You have to do a proforma or budget based on the costs that you know you will incur. We can then look at what dues structure is needed and what will be tolerated by the average franchisee. Money is important, but numbers of members are more important.
Affinity programs and Member Benefits. These are two areas where over time you can build an income stream by simply providing your members with benefits. The IAFD has a number of them that are ripe for your using.
Events. Down the road as an established Association you can create your own events whether that is your own Convention or something as simple as a Golf Tournament. We have tools in place to help with all of that.
There are many more things that I could discuss in this initial strategy, but I need to get to know your needs a little better and we can put specifics behind these ideas. I look forward to working with you.
Learn the essentials that will help you manage an ever evolving landscape with this
conference designed specifically for organizations with 10 or less staff members.
This type of approach helped the Denny's Franchisee Association members work with the franchisor in adding a gift card program, including a program where gift cards are sold by third-party vendors.
"The negotiation of the legal documents, along with the financial settlement issues associated with the program, were worked through carefully and thoroughly before the franchisees were asked to participate," Barber says.
"The entire franchise community accepted the program and benefited from the hours and expertise of DFA board members who worked diligently for the good of the brand."
Communication with all franchisees, whether or not they are members of the association, is one of the four main functions of a modern franchisee association.
The other three functions are: education, providing member benefits, and advocacy.
But, as Craig Barber states, "Members should expect the association to focus on brand and franchise system matters," adds Craig Barber, Chair of the Denny's Franchisee Association.
"[They should] not expect the association to be the advocate for specific individual franchise issues with the franchisor."
Les Stewart writing about successful franchisee organizations makes an important point, an uncharacteristically short post. Can you tell what the important point is?
I was in downtown Toronto, Canada this morning, meeting with an old MBA classmate and a commercial litigator associate of his.
Very nice meeting.
We all agreed on one thing: a professionally managed and funded franchisee group is critical in defending your economic interests.
Everyone needs a group to work on their behalf and +90% of all association work is not in conflict with the franchisor.
To me, budget $7 per day per year ($2,000 per store) to get it going.
Any less is a license for failure.
You might think that the $7/day fee is important, but it is not. A professional executive director of an IndFA is going produce through vendor programs or other services more value than the membership fee.
No, the important point is this: a lot of the association work has nothing to do with resolving legal disputes with the franchisor.
This is the dilemma: franchise groups come together over serious distrust issues with their franchisor, but in order for the group to become an association they have to find, succeed, and continue doing all of the other hard work which has nothing to do with franchisor conflict.
