Introduction: Who Do You Know?
In the early days of franchising, franchisors found new operators by asking "who do you know?".
For example, Colonel Harland David Sanders left Kentucky in search of great restaurant operators who could be Kentucky Fried Chicken franchisees. The Colonel would roll into town and ask "who do you that has good food for a hungry traveler?"
He would check them out and then pull his "chicken cookers" out his trunk and proceed to make the restaurant owner his Kentucky chicken.
The Colonel did his "who do you know" pitch across country until he reached Salt Lake City and Pete Harmon. He signed up Pete to be the first Kentucky Fried Chicken Franchisee.
Other franchise developers used the Colonel's recruitment technique of going from town to town asking around at the city hall, the chamber of commerce, the Elk's Club, etc...asking "who do you" to sell their franchises.
LinkedIn is the ultimate social networking neighborhood for asking "who do you know" to people who have an active or latent interest in franchise ownership.
Rise of the Web Portals - Buying Leads
Prior to LinkedIn, getting reliable contact data from people in transition, interested in new opportunities, or starting a business was very hard.
The Web Portal industry sprung up to fill this need. By a combination of methods, scraping job boards, creating their own collection forms, and reselling contact data amongst each other, the Web Portal industry created a database of contact information. They called this contact information: "leads".
"Leads" were resold many times over to franchise brokers and other web portals.
All of this made certain amount of economic sense, because this contact information was hard to obtain.
Currently, "leads" produce contact information which industry experts say 1-100 or even 1-200 will produce a franchise sale. At current prices for "leads" or contact information, an average franchise broker can expect to layout between $2,500 - $5,000 to buy enough leads to get a franchise sale. Or much more.
Next Lesson: The Alternative to Buying "Leads" - Prospecting on LinkedIn