Why remaining resilient is always the best course of action for your franchise network.
Just over a year ago, we had plans to expand our franchise system into a new international market. Then COVID hit, and we, like the rest of the world, were forced to change tack. The months that followed proved to be both educational and reaffirming, as our franchise network was forced to rely on itself to adjust to the ever-changing conditions 2020 presented, which it did with great aplomb.
The experience reminded me of how extremely important fellow franchises are to one another and to contributing to making the HomeVestors national brand and ultimately their businesses, successful.
It can be difficult in a franchise organization to balance ambition and competition with camaraderie and cooperation. Rivalry can cannibalize market opportunities, while collaboration can improve business and build fulfilling careers. For us, the soundest way to maintain a healthy franchise culture is by building a solid franchise home that protects the integrity of your brand, establishes opportunities and incentives for cooperation, and finally, lets it grow.
A firm brand foundation
The brand you represent and your franchise trademarks should provide a level of security that gives comfort to franchisees and consumers alike. It’s not as simple as getting a trademark, it’s also about protecting it against infringers.
For example, our legal department spends quite a bit of time dealing with “We Buy Ugly Houses” imitators that don’t reflect our same business practices and standards. We are the only company that can say “We Buy Ugly Houses”, which we use extensively in our marketing campaigns to distinguish ourselves from the rest.
A good trademark strengthens your ability to do business. For our franchisees, national brand recognition helps to support their capitalization. And, to build a business buying, renovating, and selling property, you’ve got to have money.
Our franchisees find that with a trusted name like HomeVestors behind them, hard money lenders actually compete to finance their deals. And having this kind of shared assurance and representation minimizes the potential for negative feelings that could compromise the franchise network.
A reliable franchise structure
A predictable structure for franchises contributes significantly to a healthy franchise ecosystem. This starts with your actual model and how you put it into practice with your franchise network.
We start all of our new franchisees with UG University, where we introduce them to our national brand and marketing campaigns, our conscientious business practices, our proprietary tools, and mentor them. Each independently owned and operated franchise also has the support of fellow franchisees in their market, which they can tap into as much or as little as they want to – from knowledge sharing to coordinated marketing buys, and ultimately, fair distribution of leads.
“The soundest way to maintain a healthy franchise culture is by building a solid franchise home that protects the integrity of your brand”
A good franchise is committed to both the brand and its local community. For us, having market-specific co-ops that make joint decisions about how to build the brand and drive local leads gives them a sense of accountability and ownership. It’s easy to place blame on an anonymous corporate behemoth’s decisions, but when franchisees are empowered to cooperatively advertise the brand, they connect in healthy ways that give them a greater role in driving market performance.
The shelter of an extended family
Since 1996, our franchisees have thrived through multiple national crises, adapting quickly to whatever their local circumstances are. Last year, as the first markets to face lockdowns in spring, like Boston, adjusted to keep buying houses, those franchises shared their learning across the company. By the time San Francisco entered lockdown, its local franchisees were ready. Our franchise network’s ability to organically learn and adjust to variable market conditions has helped us weather good markets, bad markets, and even scary markets like 2020.
Despite the challenges we faced last year, we never stopped buying houses, and nobody knew what the impact on real estate would be in March. Then, a funny thing happened – March and April were some of our best-selling months.
Franchisees were quickly listing properties to avoid them not selling in the case of a crash, and those houses sold for top dollar. Across the network, franchisees discovered that there was no fear of selling, because inventory was low and the people buying in our part of the market are always looking and buying.
And, as soon as a market trend or behavior becomes even the slightest bit predictable like it did in spring, our coordinated franchises react quickly and confidently.
All living things thrive when provided with security, even businesses. As franchisees discover a mutual concern for business performance, they have more energy to devote to productive endeavors and don’t waste emotional energy on internal competition and conflict. Once they understand you have their best interest at heart, they, in turn, give you their trust.
And like a healthy home environment where routine and predictability help the members thrive, I have seen firsthand the effect a healthy franchise environment can have to help the individuals and businesses thrive. Now, more than ever, we can all benefit from a greater sense of security in business.
We may be a national company but we are actually made up of a network of 1,150 local small independent businesses that enjoy the support and backing of a powerful national brand. The first indication we have of franchisee confidence is their level of ad spending, and for the first quarter of 2021, our franchises are advertising at a level six to 10 per cent higher than they did last year pre-COVID.
On one hand, we have a robust housing market to thank for that confidence. But, we also credit the safe assurance of not just a proven model, but warm fellowship and support. While the independence of small business ownership draws many to become franchisees, we all benefit when we still get to be part of the team.
THE AUTHOR
David Hicks is the CEO for Dallas-based HomeVestors of America, Inc., the largest professional house buying franchise in the U.S. with more than 100,000 houses bought since 1996.
