How Technology is Driving the Future of Franchising with Dave Liniger

There are more than 750,000 franchises in the United States, meaning that more than 10% of American businesses are part of the franchise model.

Adam welcomes back Dave Liniger to talk all about franchising and how technology is likely to be one of the biggest drivers of the industry moving forward.

Dave Liniger started RE/MAX in 1973, and it has become the largest real estate company in the world with a record year in 2021. He also runs a private equity company, Area15 Ventures, focused on emerging franchisors and high-growth businesses and franchise concepts.

Dave tells story of beginning of RE/MAX and selling his very first franchise in Kansas City. Over the course of the next two years, Dave sold more than 100 franchises across North America.

Dave explains the concept of a franchise as a system of methods, training, advertising and more that can be imparted on franchisee. The franchisee pays a fee to buy into the concept and pays the cost of opening a business, making the franchise model a great way to rapidly expand a business concept without it being cost-prohibitive. 

Dave shares the four key elements of franchising:

1. Unique product or service
2. Brand, advertising and market share
3. Purchasing
4. Training Technology and Systems

Dave shares the story of the success of the McDonald’s franchise and how it transformed the fast food franchise industry.

One of the biggest benefits of owning a franchise is the access you receive to a network of peers. You get to learn from each other and share ideas and insights to grow businesses. Dave also shares that every significant, good idea for RE/MAX came from his franchisees. He tells the story of how breakfast, the filet o’ fish and the Big Mac started at McDonald’s thanks to the ideas of franchisees. 

Adam and Dave talk about a new franchise concept they have acquired through Area15 Ventures called Daddy’s Chicken Shack. This business is a great example of how technology is driving the future of franchising. As a walk-up concept, the restaurant blew up during COVID, generating over $1 million in revenue. The owners designed a prototype with curbside pickup and limited seating, and featured technology that enables guests to order food via their phone, on the app and through food delivery services. The technology tracks the order and geo-targets the customer, and when they are 8-minutes away from the restaurant, they begin preparing the food. The drive-thru is also only for pick-up orders. This technology is eliminating the need for waiting in lines for pickup. The restaurant also features in-person ordering via artificial intelligence.

Episode Links:

DaddysFranchising.com 

Area15Ventures.com

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