Many large retailers are expanding into the Hispanic market through franchise agreements (see for example Pizza Patron, Del Taco, Papa John's and Denny's). A crucial factor to the success of their business is that they work with Hispanic franchisees. In today's Sounding Off column, Jose Torres, Principal Partner and Founder of BuscaTuFranquicia.com, writes about the opportunities and challenges in recruiting Latino franchisees.
When you're a franchisor looking to expand to a new group of franchisees, you have your work cut out for you. You can focus your time on expanding your current demographics, or you can target entirely new demographics. The one demographic expanding the fastest in the U.S. today are Latinos, which makes them a sensible target for franchisors.
Unfortunately, there are a number of common mistakes you can make that can ruin months of progress and set you back time and money. Not to mention the possibility of offending your target group, causing much more harm than simply failing to recruit them. Here's what to keep in mind.
- Failure to have Spanish speakers on staff is one of the worst mistakes. A salesperson who speaks Spanish fluently is essential when up to 40 percent of the Latino population you're targeting speaks limited English. A native Spanish speaker can greatly reduce the chances of miscommunication and raise your success rate for recruitment.
- Mistake number two is relying on translation software for your advertisements. Translation software is relatively advanced and can translate the words accurately enough, but it lacks the underlying values and emotions that resonate with the culture you're trying to reach. It's much safer to rewrite your ad copy completely, preferably by someone who speaks Spanish natively and who understands the culture you're targeting. This sort of translation is much more reliable and less likely to turn away your potential franchisees.
- The third mistake is generalizing Latinos. Making assumptions about a person or a group never works out even when that person or group is one you belong to. Making assumptions about a culture different from your own just makes it worse. Not all Latinos, Hispanics and Chicanos are the same.
- Web content and design, advertising and data presentations need to be tailored to the specific group you're reaching out to contact. Things like education levels and political leanings vary just as much in the Latino ethnic groups as in any other. Forgetting this and over-generalizing when you're making contact will end in failure one way or another.
- Another common mistake is misunderstanding Latino finances. United States banks are generally stable, but Latinos often come from places with unstable banks. The typical white American has one or more bank accounts and keeps most of their money in said accounts while building credit and using credit cards.
Many Latinos do none of the above. A full 35 percent of United States Latinos don't even have a bank account. As many as 60 percent of Spanish-speaking Latinos don't have credit cards. Because banks are less stable where they come from, many of them don't have the trust that Americans place in banks implicitly. Even those who do have bank accounts and credit cards rarely build up to the same levels of credit score as non-Latino people.
If a franchiser wants to contact these Latinos as franchisees, they have to realize that a low credit score or lack of financial accounts is not an indicator of large debt, financial irresponsibility or any of the other negative consequences of poor credit in white Americans. Some allowances will have to be made.
Another common franchiser mistake is hiring inappropriate people for the job. Just because someone has a Spanish name and speaks Spanish with reasonable fluency doesn't mean they are the ideal person for the job. They need to be able to understand Latino culture just as much as the language. Knowing the market, knowing the people and knowing the culture is all part of the necessary requirements for successful contact. Simply being able to speak the language is not enough.
Latino culture puts value on relationships that build slowly over time. This means that any franchisor looking to step in and throw an ad campaign at a Latino group expecting immediate results will be disappointed. Latinos will wait until they have determined the franchisor is trustworthy, and only then act. This should come naturally with an increased knowledge of Latino culture, but it's always tempting to rush it in a push for results. Latinos are also aware of what hasn't worked in the past, so repeating techniques will not work.
If all of these mistakes are avoided, the chances of successfully reaching the Latino community for franchisees grow much higher.
Here are 5 ways to attract and recruit Hispanic Franchisees:
- Use targeted content for Hispanics and Latinos, and avoid too general content.
- Contact and build relationships with the major Latino organizations around the country.
- Establish a presence at the major Latino franchise events in metropolitan areas. A greater presence helps show you're willing to make the investment.
- Contact Latin American investors who have an interest in relocating to the U.S. and see what aid you can offer.
- Have your franchise listing translated into Spanish by someone capable of making the translation with more knowledge than a machine translator. You can re-use this listing for many purposes.
Jose Torres is Principal Partner and Founder of BuscaTuFranquicia.com, the first and only Spanish & English language online market place for aspiring Hispanic and Latino entrepreneurs looking for business opportunities and Franchise Companies looking to tap into this community. Jose is also a franchise advisor and consultant and has over 20 years of general business management, marketing and sales experience in the consumer goods and franchise services industry.