How Small Franchises Can Compete With The Big Brands

25/03/2018 08:00 | Start a business

Can small franchises compete with big brands?

Starting your own small franchise soon? Although you might think it’s impossible to compete with big, international brands, there are still plenty of ways in which you can build a loyal customer base. Smaller businesses can be very successful if they can find a way to differentiate themselves from the biggest franchises and focus on building brand awareness on a local level.

So, here are ten ways small franchises can compete with big brands:

1 - Draw attention to the quality of your products/services

Large franchises can rely on brand visibility and convenience to retain customers. For example, if a large restaurant franchise brand is present in just about every neighbourhood you can think of, people might dine there for two reasons: they know what the brand is, and they live nearby. These customers may not necessarily be eating at this restaurant because of the quality of its food or value for money. They’re choosing it because they know what to expect and they don’t want to take a longer journey/walk to go to a competitor further away.

Therefore, it's essential for small franchises to focus on the quality of their products/services and delivering the best customer experience. So, for example, a large pizza chain might use pre-frozen pizza bases so that it can sell the highest volume of pizzas in the shortest timeframe. These pizzas may be cheaper than what you could afford to charge. However, if all your pizzas are freshly prepared with the highest quality dough, your customers may be willing to spend a little more if they know the pizza will taste better.

2 - Offer your customers something new

Think of something that your customers wouldn't be able to receive at the biggest franchises. It may be your products/services, or it could be your style of customer service that differentiates you from everyone else.

For example, imagine if you were a small Italian restaurant sourcing your wines from your large family-owned vineyard in Italy which doesn’t sell its wines to any wholesaler? It would be difficult for a large brand with dozens of franchises to offer something so authentic. However, when people dine at your restaurant, they’ll know they can order wine that they won’t be able to drink anywhere else.

3 - Personalise your customer service

If you want to achieve a loyal customer base, one of the best franchise ideas is to personalise your service. Many of the biggest franchises will struggle to do this because they tend to have higher rates of staff turnover, so it's more difficult for staff to get to know their customers.

Small franchises will often have the same staff for years at a time, and this creates an opportunity to provide a more personalised customer service. For example, a café franchise may have a loyal customer who always likes to order the same drink or cake on every visit. Sooner or later, the only word you'll need to ask the customer is ‘usual?'. This will achieve two things: it will save you time, and you'll make the customer feel valued.

4 - Be flexible

Continuing with the café example, imagine if someone arrived just as closing time was approaching. A big, well-established café brand could easily get away with saying ‘sorry, we’re closing’, but a small franchise might want to look at things differently.

Imagine if this were a new customer who had just moved to the area and was looking for a new café? If you were too rigid and decided not to let the customer in, you might have two problems. Firstly, you’d lose all the business that this customer could have given you over an extended period. Even a few coffees a week can add up to a lot of revenue in the long term. For example, over three years, the customer could have spent £1,170 buying three coffees costing £2.50 a week. Secondly, you could receive a bad review on Facebook or Google, which could deter other people from coming to your café, resulting in more lost revenue. However, if you were a little more flexible and offered the customer a coffee to take-out, the outcome might be very different.

5 - Localise your online marketing

It’s a good idea to focus on less-competitive words and phrases because the most popular search terms will often be dominated by the biggest franchises, which have much larger marketing budgets. For example, if you’re a new café franchise in London, using regional keywords like ‘Café in [neighbourhood]’ rather than ‘café in London’ may be more useful for improving your online visibility. The search request for a phrase like ‘café in London' will usually yield results for very famous cafes or articles from high-profile publications and newspapers on the best cafés in the city.

Instead of spending a lot of money advertising your business on a prominent publication, consider local media like community newsletters. These will not only be much cheaper; they'll help you reach out to a local demographic so that you can make a name for yourself in your area. Plus, once you get customers and provide them with excellent service, they might be willing to recommend you to their friends and families. For small franchises, there’s nothing more powerful than word-of-mouth marketing.

Another exciting way to connect with your audience is to talk about a local event such as a festival or post a blog on a relevant topic (i.e. a restaurant franchise talking about healthy eating. Even talking about an unusual weather event, such as a rare spring snowfall or a summer heatwave, can be a great way to strike a conversation with your customers.

6 – Adapt to change quickly

One of the biggest advantages small franchises have over their larger competitors is that it’s much easier to change different aspects of their business without causing too much disruption. Imagine how much time and money it would cost for McDonald’s to create a new bland slogan and logo? The largest franchises also face far more obstacles when they need to adjust their marketing or businesses systems, whereas smaller brands can implement new franchise ideas quickly.

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