Why Repeat Customers Matter in a Franchise | NZ
Why Repeat Customers Matter When Buying a Franchise
When you're looking at buying a franchise, it's natural to ask how much you could sell.
But there's another question that can be just as important:
How often do you have to win the same sale?
Some businesses are heavily dependent on continually finding the next customer.
You make the sale. You get paid. Then tomorrow, you need to find someone else.
A business built around repeat customers can work very differently.
At Hygiene Direct, many of the products our customers purchase are consumables. Businesses use them every day, run out of them and need to order more.
For a franchisee, that creates a simple but potentially powerful opportunity:
Win the customer once. Look after them. Keep the relationship. Then keep building from there.
Not All Sales Are Equal
Imagine two businesses each make $1,000 in new sales this week.
For the first business, those are one-off transactions. Next week, it needs to generate another $1,000 from new customers.
The second business wins customers who regularly need to reorder what they've purchased.
Both businesses generated $1,000 in new sales.
But potentially, they haven't created the same value.
The second business may have begun relationships capable of generating sales again next month, and potentially for years to come.
That's one of the things we'd encourage anyone researching franchise opportunities in NZ to investigate.
Don't just ask:
“How much can I sell?”
Also ask:
“If I win a customer, how often are they likely to buy again?”
What Makes Hygiene Direct Different?
Hygiene Direct supplies commercial cleaning and hygiene products to businesses and organisations throughout New Zealand.
Think about some of the products a typical workplace uses:
- toilet paper;
- paper towels;
- rubbish bags;
- cleaning chemicals;
- gloves;
- hand hygiene products; and
- other everyday cleaning and hygiene consumables.
These aren't products a business generally buys once and never needs again.
They're consumed.
Then they need replacing.
That's why developing a strong customer relationship matters so much within a Hygiene Direct franchise.
A customer who trusts you, receives good service and gets the products they need has a reason to continue buying from you.
The First Order Is Just the Beginning
In some businesses, getting the order is the finish line.
We think differently.
The first order is the beginning of the relationship.
Once you've won a customer, the next job is to look after them.
Understand what they use.
Make sure they have the right products.
Be responsive when they need help.
Introduce them to other products that could genuinely benefit their organisation.
Solve problems when they arise.
And make it easy for them to keep doing business with you.
Do that well and you've potentially created something far more valuable than one invoice.
You've created a repeat customer.
Persistence Gets You In. Service Keeps You There.
We've talked elsewhere in this series about how important persistence is to building a Hygiene Direct franchise.
You have to prospect.
You have to make calls.
You have to visit businesses.
You have to follow up.
And sometimes you have to keep trying before someone gives you an opportunity.
But persistence is only half of the equation.
Persistence helps you win the customer. Great service helps you keep them.
That's important because the real power of a repeat-customer business comes from retention.
There's little benefit in winning ten new customers if you lose ten existing ones at the same time.
The objective is to keep adding customers to the base you've already built.
Add One. Keep One. Then Add Another.
The concept is incredibly simple.
Win a customer.
Look after them.
Keep them.
Then find another.
If you continue doing that consistently, the customer base has the potential to grow over time.
That's where persistence can compound.
The prospecting you did three years ago may have produced customers who are still buying from you today.
The customer you win today could potentially still be purchasing years from now.
And tomorrow you can go looking for another one.
What Could That Look Like Over Time?
Imagine a franchisee consistently wins two worthwhile new repeat customers every month.
That doesn't sound dramatic.
But if those customers are retained, that's potentially 24 additional customers after one year.
Keep going and the numbers continue to build.
Of course, real businesses aren't that perfectly predictable. Customers come and go, sales values vary, circumstances change and there is no guarantee any customer will remain indefinitely.
But the principle remains:
consistent prospecting combined with strong customer retention can progressively build a much larger customer base.
That's why persistence matters so much.
Not because every call produces an order.
But because every customer you do win has the potential to become part of the foundation you're building upon.
Repeat Customers Can Change the Way a Business Grows
This is where a repeat-customer model becomes particularly interesting.
Suppose you begin a year with an established group of customers already ordering from you.
You're not necessarily beginning January with zero sales.
You're servicing the relationships you've already developed while continuing to prospect for more.
The objective is to layer new business on top of existing business.
Existing customers reorder.
You win new customers.
Some new customers begin reordering.
Then you continue prospecting.
Over time, the work you did yesterday can help support the business you're building tomorrow.
There's No Artificial Ceiling on the Customer Base You Can Build
This connects directly with another important part of the Hygiene Direct franchise opportunity.
There is no predetermined income ceiling.
We're not employing you on a salary.
We're not telling you that once you reach a particular level, you've earned the maximum available for your position.
You're building your own business.
If you want more customers, keep prospecting.
If you want a larger business, keep developing your territory.
If you've built a strong customer base, don't stop.
Keep looking after those customers and keep finding more.
Your actual earnings will always depend on sales, margins, expenses, customer retention and how effectively you operate the business.
But there isn't an artificial point where we tell you:
“That's enough. You can't grow any further.”
You're Building Your Customer Base – Not Someone Else's
For experienced salespeople, this is worth thinking about.
If you're already good at prospecting and developing customer relationships, you're probably doing many of these things now.
You find opportunities.
You make calls.
You follow up.
You win customers.
You build relationships.
You retain accounts.
But if you're employed, the customer base you're helping build ultimately belongs to your employer.
When you're operating your own Hygiene Direct franchise, your persistence is being directed towards building your own business.
That's a fundamentally different proposition.
Repeat Customers Can Help Build a Saleable Asset
There's another reason repeat customers matter.
A business with an established customer base and ongoing sales can potentially become an asset somebody else wants to buy.
That's very different from simply creating an income for yourself.
You're potentially creating business value.
We've recently seen this within the Hygiene Direct network.
Our Northland franchise went onto the market and sold within approximately two months.
The purchasers were two existing Hygiene Direct customers.
They already understood the products and had experienced the service from the customer's side.
They saw enough in the business to decide they wanted to become franchise owners themselves.
That's exactly the sort of long-term value we're trying to help franchisees build.
What Does a Decade of Repeat Business Look Like?
Our first two Hygiene Direct franchisees joined us approximately 10 years ago.
Both are still with Hygiene Direct today.
Think about what 10 years represents in a repeat-customer business.
Thousands of customer conversations.
Relationships developed.
Customers won.
Orders delivered.
Problems solved.
New products introduced.
New prospects approached.
And then doing it again.
Building a business isn't usually the result of one spectacular month.
It's much more often the result of doing the right things consistently for a long time.
The Formula Isn't Complicated
There's no magic formula.
In fact, the basic idea behind building a Hygiene Direct franchise is remarkably straightforward:
Prospect consistently.
Win customers.
Provide great service.
Keep those customers.
Then keep prospecting.
The execution requires effort, discipline and persistence.
But every customer you retain gives you something to build upon.
And that's why we believe repeat customers are one of the most important things to consider when comparing franchise opportunities.
Look Beyond the First Sale
If you're thinking about buying a franchise in New Zealand, don't only look at what you can sell today.
Look at what you're potentially building over five or 10 years.
Ask whether customers need to keep purchasing.
Ask whether you're able to develop long-term relationships.
Ask whether your prospecting effort today can contribute towards tomorrow's sales.
And ask whether the business you're building could eventually become an asset you can sell.
For Hygiene Direct, repeat customers sit at the heart of that opportunity.
Win them. Look after them. Keep them. Then keep building.
Explore Hygiene Direct Franchise Opportunities
If you enjoy building customer relationships and like the idea of creating a business where today's sales effort can potentially contribute to tomorrow's customer base, we'd like to talk to you.
Hygiene Direct provides the brand, products, systems, supplier relationships, Head Office support and experienced mentoring.
You provide the persistence.
He waka eke noa – we're all in this together.
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Interested in a Hygiene Direct Franchise?
If you're looking for a business where persistence can help you build an increasingly valuable base of repeat customers, take a closer look at the Hygiene Direct opportunity.
Own Your Business with Full Head Office Support – Hygiene Direct
He waka eke noa – we're all in this together.