CHAPTER 1:
how RAINTREE IDENTIFIES THE BEST EMERGING FRANCHISES

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MEET RAINTREE

A few months ago, I read an article from Forbes entitled, “A Franchising Boom May Be on The Horizon”. The author, a CEO and Forbes Councils Member by the name of Mark Otter, was commenting on how, throughout industries, talented and highly skilled people are getting increasingly fed up with their dead-end jobs. In this article, he observes an increasingly common phenomenon:

Specifically, he pointed to statistics on turnover rates, along with public opinion polls showing the high number of employees who were either actively making plans to quit their jobs or who were seriously considering making a change. Then he looked at the rising popularity of franchising, suggesting that these frustrated members of the working class might be significant contributors to the growing number of first-time franchisees.

It occurred to me while reading this article that Otter and I have been looking at the very same franchising wave, only I’ve had my eye on it for almost a decade. When I first started noticing the rise in franchising relationships, I was a franchise consultant helping brands and franchisors market themselves and increase their visibility. From the time that I first opened my own franchise sales organization, Raintree, roughly five years prior, I’d receive roughly 100 applications per year from franchisors seeking out my organization (either as an investment or for representation).

But as I read the Forbes article, I developed a better appreciation for the franchisee, or franchise owner, side of the equation.

At that point, I’d already spent almost a decade as a franchise consultant, but After spending years as a franchise consultant, I took the leap and opened my own franchise sales consultancy, Raintree.

In just five years, Raintree has grown from a small organization to an innovator and industry leader in effective franchise sales. Through tireless hard work and dedication, we’ve watched our partners flourish. Our mission is to connect the most promising emerging brands with the strong franchise owners and leaders they need to spark thriving new business opportunities.

WHAT WE DO

Believe it or not, if you’re looking to franchise, you have roughly 4000 franchise opportunities to choose from. Especially if you’re new to franchising, the prospect of researching just a handful of them can seem overwhelming. That’s precisely where Raintree makes a difference. We carefully vet and hand select our franchising partners and franchise candidates, making sure to verify business models and potential success, but also make sure that prospective franchisers have what it takes to successfully start and manage a budding franchise opportunity.

Raintree is a company made up of franchisors, franchise owners and franchise development professionals. We’re passionate about growing franchise brands properly, following a research-backed and meticulous process to ensure that every new franchise begins the right way, and with the right people.

If you’re already familiar with Raintree and just starting your franchise discovery process, then you can have confidence that the brand we’ve matched you with was carefully selected and paired with you not just based on proven profitability, but also based on your own strengths and professional background.

As the CEO of Raintree, I work closely with my team to analyze and evaluate somewhere between 200-300 brands per year. And of those hundreds of brands, our team generally selects less than 1% of the candidates (one or two brands per year) to join our brand portfolio.

We make our vetting process a priority because we understand that not every product, service, or business model will be a guaranteed success. That’s why our vetting process involves months of “looking under the hood” of each candidate interested in being included in our portfolio.

RAINTREE’S LIST OF EMERGING BRAND CRITERIA

We take time to fully understand each brand, and we also verify that each candidate meets a very strict list of criteria that are data-proven to indicate a significant and replicable franchise performance:

1. Strong Financials

Through an in-depth audit process, each brand must demonstrate a history of strong financial performance, including:

  • Consistent 2-3 year RETURN ON INVESTMENT achievement
  • 20%< net profit margins

2. True Brand Differentiation

Sure, people tend to love burger and pizza joints. But just how many burger and pizza franchises are out there? Opening an undifferentiated franchise in an already saturated industry is a risky move, and in all likelihood, it will be a poor investment. We conduct in-depth market research and pay close attention to shifting industries to make sure that the:

  • Brand is in high demand
  • Brand industry is not oversaturated
  • Brand segment is primed for rapid growth (and all major markets should allow for successful adoption of the model and brand)

3. Broad Franchise Opportunities

While franchise ownership often begins with the desire for investment and passive income opportunities, we understand that your goals grow with your successes:

  • We look for emerging brands that provide multiple franchising opportunities, something we commonly refer to as “territory”, giving franchise owners the opportunity to invest in multiple “territories” and build their wealth.

4. Strong Franchise Support Infrastructure

We understand that finding the right franchise is half the battle. Whether you’re a seasoned franchise owner or you’re a complete newbie, truly successful brands understand that their success is built from the collective success of their franchise owners. For this reason, we look for brands that demonstrate a committed and active interest in supporting franchise owners:

  • Strong brand founders with exceptional franchise owner support programs
  • Executive teams must demonstrate a continued involvement in working with us as we develop and grow all support infrastructure for the brand across the country
  • A successful brand knows how to delegate and also understands the importance of procedure. Brand candidates must show robust processes and thoughtful planning in all major areas of brand functioning (including site selection, local marketing, profit coaching, operational support, etc.).
  • Strong personnel, in addition to a powerful and healthy brand culture, must be present throughout the brand’s organization.

While setting off on your own to find a franchise opportunity that meets all five of these eligibility criteria is a tall order for anyone to do alone, but by going through the process with Raintree, you can be rest assured that all franchise options presented to you have already successfully gone through our vetting process.

As you continue taking steps towards franchise ownership, be sure to keep the following items in mind and take time to carefully consider what each opportunity might mean for you.

We recommend each prospective franchise owner pay particular attention to:

  • The Franchise Disclosure Document and the Item 19 (how much you can make)
  • Any calls you have with brand founders or members of the executive team
  • Franchise owner insight, whether it be pre-recorded group video calls or live conference calls.

If this all sounds foreign to you, then don’t worry. In the coming chapters, we’ll be walking you through the insiders guide on how to navigate the world of franchise businesses and what to look out for as you begin selecting favorite franchise brands and taking the journey through the franchisee selection process. 

TAKEAWAYS
Who is Raintree and what do we do?
What does Raintree look for in an emerging brand?
Signs that a brand is invested in its franchisees:
To learn more about the full list of brands in the Raintree portfolio, visit the brand website or call 720.824.5141. Get matched to the best-fitting elite franchise today.
LEARN MORE
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The most innovative and effective franchise sales organization in North America.

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