Statistically, franchised businesses are positioned to bring in greater revenues than independently-owned businesses.

The U.S. Small Business Administration has found that on average, a franchise can earn five times the first-year revenue of the average independent business and over 95% of franchises that open are still successfully in business five years later.

Since franchisees typically receive more training and resources than independent business owners, this makes sense. In addition, franchising is  a tested and proven business model.

So why do franchise owners struggle?

The interests of the franchisee and the interests of the franchisor are often at odds. With this in mind, here’s a look at 3 things that makes a franchise owner successful, beyond standard franchisor support.

1. The franchisor and franchisee care about different things

The number one concern for a franchisor is revenue growth. As long as your franchise continues to increase revenue, the franchisor is happy. The franchisor collects a monthly royalty. As long as that monthly payment keeps getting bigger, all is good.

In contrast, as a franchisee, your primary concern is net income growth—profit. If your profit is growing, you’re happy. In fact, if you can boost profit by lowering expenses and not increasing or decreasing revenue, that’s awesome. Good work!

Unfortunately, the franchisor doesn’t see it that way. 

This juxtaposition of interests does not make franchise ownership bad. However, it is extremely important that you understand these conflicting interests. The better you understand this concept, the more successful you’ll be as a franchise owner.

For example, look at your monthly reports from the franchisor. From their viewpoint you’re killing it because your top line is growing. But what are your own financials telling you about your net income growth?

If you aren’t making any money or just scraping by to pay your bills—that’s not awesome. If you’re not paying yourself, you need to start asap. I know a lot of franchise owners that don’t pay themselves regularly, but insist their business is doing well. Hmmm, really?

Generally speaking, the more profit you can earn, the happier you are as a franchise owner. To succeed at owning a franchise beyond what the franchisor supports, you must look beyond franchisor-produced sales reports, which only track revenue growth and instead, focus on growing your net income.

2. Company culture, not included

When you buy into a franchise, company culture is not included. 
Owning a franchise is great because you essentially purchase a proven business model and operating system. You don’t have to recreate the wheel. The product, brand, sales strategy etc. is already created—you just have to execute it.

Unfortunately, the franchise operating system does not include your own unique company culture. Even if the franchisor has these things, it makes sense for you to expand on the culture statement. In fact, you may place value on some additional points that will make your location thrive.

If you don’t define your company culture, your employees will. And they might have other ideas than you—like, bad ideas that will limit your business growth and success.

To succeed at owning a franchise beyond what the franchisor supports, you must create your unique company culture. Write it down and hire employees that believe in your culture and act according to its guidelines.

3. Being a business owner doesn’t make you a leader

Buying a business does not instantaneously make you a leader. Damn! If only it did.

If your franchise requires that you hire a team, you will need to learn how to manage and motivate employees to run the business. 

If your franchisor offers leadership training or management training—sign up and take it! If nothing is offered, then it’s on you to invest in yourself and learn how to lead and manage people.

Invest in yourself by attending seminars, reading books and learning from other business owners. The more you invest in your own leadership training, the more you can give back to your team.

To succeed at owning a franchise beyond what the franchisor supports, you must invest in your own leadership and management training. Make it a continuous priority.

Final thoughts

Notice that all of these things could easily be applied to succeed at owning an independent business. There’s no secret sales strategy or silver bullet to franchise ownership or business success in general.

It all boils down to knowing your numbers, operating your business within those means, creating your company culture, hiring people who believe in it, and investing in your own leadership and management training.

When you approach franchise ownership with a focus on these three principles, it isn’t sexy. It doesn’t involve a killer social media plan or some cool video with viral potential. Perhaps that’s why many franchise owners don’t jump with excitement to work on these things.

However, if the foundation of your business isn’t rock-solid, then you’re going to keep struggling—whether you own a franchise or not.

This article has been edited.

Carolyn Hern is a small business owner of two Pure Barre franchises located in Winston-Salem and Clemmons, NC. Pure Barre is a unique workout which provides exceptional results by utilizing the ballet barre and isometric movements. Carolyn is passionate about her business and developing her team and shares her experiences in the business of fitness on her blog at She’s On Her Toes. Connect with @shesonhertoes on Twitter.

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