For the fourth consecutive year, Tom Spadea made 1851’s Top Franchise Legal Players Award. This year, Tom and 1851 Franchise sit down to discuss the best way franchisors can grow their business and the impact COVID-19 will have on the industry.
1851: What do you love most about franchising?
Tom Spadea: Dealing with entrepreneurs. The best part of what we do is helping play a role in an entrepreneur’s journey from a mom-and-pop business to a company that can create a generational wealth event for the business owner’s family. To have clients that could barely pay their bills six or seven years ago to be now courted by private equity thinking about an eight-figure exit is an amazing journey to be a part of. Franchising done right is a true exponential growth strategy, but as we all know only a select few pull it off.
1851: What is the number-one piece of advice you would give franchisors as to how to grow their brand?
Spadea: Say no to questionable prospects. The number-one thing that will determine the success of a system is the quality of the franchisees. Strong unit economics are of course a must, but without the right folks running the franchised units those unit economics will be lost on poor performers.
1851: What do you see as the top legal worry for franchisors in the next year?
Spadea: Fallout from COVID-19. What will happen at the store level, with underperforming units and the general economy. Will we finally get to test the force majeure provisions most of us haven’t thought about since law school? On the flip side, perhaps there is a silver lining to this current nightmare. If we slip into a recession many people finding themselves out of work across the country may be looking at buying a franchise to support themselves. I am an optimist by nature, so I say this is just a storm to be weathered. Those that make it through may be like Forest Gump and the Bubba-Gump shrimp company after the Hurricane created an enormous opportunity for them.
We would like to thank the team at 1851 for their time and consideration! Read the full 1851 Franchise interview here.