5 Tips for Increasing Franchisee Diversity

Building diversity in the workplace isn’t just the right thing to do, it’s good for business — especially when you’re a franchisor. When companies recruit franchisees that reflect their markets’ varied demographics, they make more money, says Stephen Joyce, president and CEO of Choice Hotels International.

Here are five tips for increasing franchisee diversity:

  1. Avoid a one-size-fits-all approach. Franchisees from different ethnic groups face different challenges based on their particular circumstances. A franchisee who comes from a wealthy, highly educated family and speaks English fluently is likely to face fewer barriers to success than a recent immigrant who comes from an economically distressed family or region and has a limited command of English. Franchisee-recruitment strategies should be tailored to the needs of diverse applicants.
  2. Craft creative financing plans. Although some minority applicants have abundant resources, other aspiring franchisees face serious challenges in coming with up the capital investment required to open a franchise. Jonathan Fornaci, president of Straw Hat Cooperative Corp., helps Straw Hat Pizza franchisees save money by encouraging them to buy equipment on Craigslist, QSR magazine reports. Meanwhile, the American Hotel & Lodging Association’s survey of major hotel companies uncovered a wide array of financial assistance and mentoring programs offered to franchisees. These included discounted application and franchise fees, forgiven loans, reduced royalty fees, and matching programs that pair minority franchisees with mentors.
  3. Cast a wide net when recruiting. Use social media and in-person events to increase franchisee diversity. “Social media does lend itself… to a diversity strategy by creating an employee branding campaign, building a company reputation of inclusion and community service, and by engaging current employees,” says Michael O’Dell, a recruiting expert. Ethnic-background and gender-based affinity groups also have proved to be an effective strategy in minority recruitment, according to the U.S. Federal Emergency Management Agency.
  4. Treat minority recruiting as an ongoing investment. Forge and cement relationships with diversity recruiting sources and affinity groups. Workplace Dynamics in Owings Mills, Md., compiled a comprehensive list of organizations and networks involved in increasing diversity in the workplace. Companies that excel in minority franchisee recruitment are recognized each year by the National Minority Franchising Initiative, a forum that addresses under-representation of minorities in franchising, and also publishes an annual list of the 50 Top Franchises for Minorities. World Franchising Network provides books, databases, and consulting services for aspiring franchisees. “Minority entrepreneurship has increased over this time as the internet has propelled collaborators past both geographic and racial boundaries,” says Cynthia Bunting in BusinessNewsDaily.
  5. Don’t stop with franchisees. Implement diversity initiatives throughout the supply chain. James Fripp, senior director of global diversity and inclusion for Yum! Brands, says that the company’s suppliers “increasingly reflect our diverse customer and investor base.” The company was named one of Black Enterprise magazine’s 40 Best Companies for Diversity “for its comprehensive results across key diversity measures for the seventh consecutive year.”

About Jan Fletcher

Jan Fletcher, President of Dreamcatch Creative, reports on restaurant operations, the signage industry, and composite manufacturing. She also writes about technology in business and education, and is passionate about microenterprise.
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