Discovery Days for franchises were developed as an opportunity for both franchisors and potential franchisees to get to know each other and decide whether they are a good match. Traditionally, they have involved in-person meetings conducted at the franchisor’s offices, but in the age of COVID, franchisors are changing that and finding benefits that may alter the process long after the COVID crisis ends.
Franchisors are creating interactive virtual programs for potential franchisees similar to what they would get during an in-person visit to the franchisor’s headquarters. This includes presentations explaining the brand, its benefits, support and training for franchisees and other matters. In addition, franchisors can conduct virtual tours of their offices and operating franchises. Franchisees can meet the management team individually and in a group setting online and ask and answer questions to help them make informed decisions about whether to move forward with buying the franchise.
These interactions with the company leaders are one of the primary benefits of Discovery Days for franchisees because they can hear their individual perspectives on the company and what it takes to be successful. Similarly, management uses these meetings to evaluate whether potential franchisees fit their culture.
Among the benefits of hosting virtual Discovery Days is that online events can attract more prospects. Partly, this is because it eliminates the time and money associated with traveling to a franchisor’s headquarters. Potential franchisees may be leery of incurring costs if they are not certain they want to buy the franchise. An online event enables franchisors to reach more prospects earlier in the decision-making process to convince them to buy a franchise.
Franchisors also can vet franchisees more easily without incurring extra time and money involved in conducting in-person presentations. One-on-one meetings also can be simpler to set up in a virtual setting than when a group of franchisees are participating in Discovery Days together.
There is a potential drawback for franchisors. When franchisees invest in traveling to a franchisor, they are demonstrating a significant interest in the brand. However, if the event is virtual, a franchisee may not be a serious purchaser and the franchisor may waste time trying to pitch them.
Virtual events do not mean that in-person meetings will or should be eliminated. Franchise relationships are long-term, and it is important for both parties to sit down together informally and get to know each other. The future will likely be a hybrid process. The online presentations and meetings offer both parties more opportunities to explore a business relationship. However, in-person discussions will continue when the parties have essentially made a decision that they want to work together.
Regardless of how the event is conducted, both sides should take advantage of the opportunities presented by Discovery Days to find a good match for the franchise. Buying or selling a franchise can be lucrative, but not right for everyone. Speaking to an experienced franchise attorney can help determine whether a party is ready for a franchise, what questions to ask before moving forward, and then guide the transaction to a successful conclusion.
If you have questions about franchising, contact Lusthaus Law today for a free consultation.