More than half of small businesses never last through the first five years of business. This is an incredible number, even more so when you stop to think that most of these businesses represent a huge investment of capital. For many, failure means walking away with nothing, having lost everything.

However, of that 50% that fail, it is worth noting that franchises have a much lower rate of failure than independent businesses. The reasons for this disparagement in the numbers are several, but it is undeniable that franchisor support plays a major role. The support offered to new franchisees give new franchises an edge in the market.

The Mutual Benefit of Support

. Effective franchisor support helps both the franchisee and the franchisor. For a franchising organization to do well, it must ensure the success and profitability of as many of its franchises as possible. Franchise success brings in revenue for the franchisor, and makes the franchise brand more attractive to future investors.

Means of Support

Franchisors offer direct support of their franchisees in a number of ways. The most visible means of support lies in the area of marketing. Franchisors run large scale marketing campaigns on behalf of their franchisees to maximize their ability to reach customers. Franchisors also often assist franchisees with developing local marketing strategies and tactics.

Many franchisors also offer a greater degree of support during the initial stages of franchise start-up. Many are very active in the critical aspects of start-up such as site selection. Again, this is because it is mutually beneficial to ensure that the new franchise starts out on the best footing.

A number of franchising organizations offer support in the form to training, and training assistance. Franchisors will train new franchisees in-depth regarding franchise management and even in general business tactics, to help them succeed. Most franchisors will also provide training material to assist in training staff members to meet brand standards.

Indirect Support

Not all franchise support comes directly from the franchisor, though the franchisor may act to facilitate and encourage it. Peer support also plays a major role in the success of new franchises. As a franchising organization become better established, the scope of peer support greatly increases.

A franchisee’s peer network consists of all other franchisees operating under the same franchising organization. Again, the older and more established the brand is, the greater the support. For a franchising organization that has been around for many years there are an increasing number of franchise owners who have been in the business for years and who know the ins-and-outs of running an individual franchise even better than those at the brand’s corporate office do. These owners have experiential knowledge, where those employed directly by the brand may not.

It is this great wealth of experientially derived practical knowledge that makes the peer network invaluable. There are very few problems that a new owner will encounter that have not already been dealt with by his or her peers. It is in these times that turning toward peers for guidance can provide a practical solution based on proven strategy. Being able to draw on the experience of peers gives the new franchisee a significant edge.