Many in the franchising industry believe that you shouldn’t recruit franchisees with zero business experience. Here’s why I think business experience matters less than you think.
There’s a standard list in franchising that outlines what traits potential franchisees should have and ‘past business experience’ or ‘business acumen’ is often near the top of that list. But as someone who started a venture with no business experience, I’m here to tell you that business skills are teachable and that there are other traits you should look for first.
I learnt just about everything I needed to know about starting, growing and franchising KX while on the job. That came from a combination of being an employee of other similar businesses and after launching the first KX Pilates studio.
While working for other businesses I came to understand the fitness industry, including the strengths and weaknesses of different business structures and how important team dynamic and customer service were. After launching KX, I learnt what worked and what didn’t through trial and error. Any gaps I saw I bridged through finding an expert to teach me and applying lessons from them to my business. In this way I realised that any non-fatal mistakes were learning curves.
The secret ingredient
Realising that business skills were teachable made me more attuned to what actually mattered when looking for franchisees: passion. Passion is something you can’t teach – people either have it or they don’t. When someone is passionate about your business, it means that they already have a kind of ownership of it and that makes it easier for them to transition into business owners.
The most successful KX franchisees in our business now are those who have passion and an amazing attitude. They are also either excellent trainers or excellent at customer service and creating a community. Most of them had no or very little business experience but came from within the KX network and then we taught them what they needed to know about running their own studio. Business skills are teachable, attitude and passion are much harder to acquire, so you should look for those two traits first, followed by the willingness to learn and develop.
This method works for KX because the way we run our studios is very simple. Majority is taken care via our Online Booking System; people purchase online, they book into a class online, they cancel or change their booking online. This means we’re not selling products off a shelf. We don’t need salespeople to know about the ins and outs of different product names, Stock Keeping Units (SKUs) and benefit they provide. KX is a service space so you need to make sure clients, when they arrive, are welcomed, connected with and they get what they came for – a fitness experience that’s attentive and effective. If you’re the right personality and you’re passionate about the business and the brand, that comes naturally.
The importance of continuous learning
Part of what makes a ‘good attitude’ is the willingness to keep learning and developing. Fortunately for us kaizen, a Japanese concept meaning ‘continuous improvement’, is a core part of the KX brand. I personally spend about $20,000 a year on education. It’s an investment because that’s what I get in return as a minimum when I apply what I’ve learnt to the KX company.
Every year we run a three-day learning and development conference for our franchisees but those who want to expand and run five studios, 10 studios, need to build their knowledge and go through more rigorous business training outside the KX environment. We can teach franchisees how to run a KX Pilates studio, but for multi-site owners we recommend looking outside the brand to further their learning.
Learning and development also helps owners set and achieve goals to keep them interested in the business. When they first sign on people are excited that they own a KX Pilates studio, but we recognise that the day-to-day running of the business after that can become monotonous. It’s like the motivation to get fit – it can wane over time, so you have to keep challenging yourself to hit higher targets, do better and strive for more.
That’s something I learnt as well: after five years I felt I was done, so I’m aware that franchise owners might go through the same thing. They either stretch a bit further or take a step back to higher management and take a passive income, which is completely fine as well.
Business owners are not born, they are made and there’s no reason why someone who lives and breathes your franchise’s brand cannot own and manage one. I would argue that with passion and a good attitude they are in the best position to acquire the business skills to make the franchise work. So next time you’re looking at a prospective franchisee, reconsider whether they really need extensive business experience. My business experience says they don’t.
Aaron Smith is the founder of Australia’s largest pilates franchise, KX Pilates. He launched the business in February 2010 and current annual turnover is at 420million pa. Smith stepped down as CEO in November 2018 to focus on brand innovation and international expansion.