Over 35 years in the franchise industry, watching many new and very experienced groups succeed and fall, my own among them, I’d say the commercial barriers to growth in a franchise network boil down to four things.
- Your product over time
- Your people and the money
- Service first always
- Systemise and delegate
So, how do your rate in the four key points Ibelieve franchisors need to look out for when establishing and running a franchise group to ensure its growth in the long term?
The wrong product for the time
Know your customer and keep your brand aligned. Then keep an eye on your market inperpetuity so you stay
relevant, contemporary and ahead of the competition.
It’s easy to dismiss this as being ObVIOUS.ThiS IS business i0iand you probably know your current business is work.ng and your known target market IS on board and loves your product.
But – is this enough”
Are the times changing and maybe your franchisees are making the change Without you?
You are responsible for the brand and marketing for everyone’s business in your network so you really need to know what is going on to keep the money rolling in.
Hire A Hubby (The Franchise Review Issue i of 20i8) illustrated this point so well when they replaced their traditional marketing tools with improved social media and online marketing. The results brought everyone on board with pride and increased the value of everyone’s assets.
The lesson here is – know your KPis. Know how your target market IS changing and what your franchisees are actually doing matched against the market’s needs. Collect and understand data from your own digital sources and stories from your franchisees and change as required.
Otherwise you will come up against barners to growth.
Get the people/money balance right
We all know franchise i0i means your franchisees give you money in return for the use of your intellectual property in the brand, your systems and the support services you provide. We also all know there needs to be enough money so both franchisor and franchisees are happily profitable and can focus on delivering great service.
What this means is budgets and cashflows with fees,royalties, expenses and profits for each tier need to be worl
The customer service industry has it right. great service is a foundation of growth and I am sure you will be teaching your franchisees to give your customers great service.
The question is – do you in tum provide your customers -your franchisees- great service too?
Don’t let hubris get in the way. Listen to what is going on around you and make sure both you and your support team are able to hear and show you have heard. I agree you will be making decisions which will not always be liked by one or all of your franchisees. But you must make these decisions in an environment where you know what is going on and the impact you will have.
Without your great service, your franchisees will not thrive nor your group grow. With profound impact on the value of everyone’s business!
The foundation of a great franchise is a great interrelated franchisor/franchisee system
Franchisor operations are rarely documented
I’m amazed even the biggest franchise brands initially take the greatest care in preparing the operations manuals for their franchisees, but completely forget to write their own.
How then, can their support staff know how to consistently deliver that brilliant customer service to your franchisees?
To grow the network.you need to systemise your franchtsor business too. I am also amazed even the biggest
brands tell me they Simply cannot get their franchisees to use their operations manuals. The reason – manuals are difficult to use, not kept up to date,not relevant to the job being done on the floor…the list goes on.
The E-Myth tells us, to delegate successfully so everything looks, feels and works the same. you need sYStems and procedures.Systems need to be simple to put together. easy to use, hyperlinked so all modern business software is connected and it is easY to travel to the right place for the answer to that question.This means your systems in today’s digital environment need to be cloud-based across all media formats.
And to give your group a foundation for growth, your systems need to be relevant. secure and easy to use and all your support, induction and training should be focused on heading here first.
Structure your franchise right to meet the needs of your target market and the personality of your franchisees. Make sure your budgets and cashflows for every level work in the long term.Make sure systems are in place for both your franchisee businesses and your franchisor business so everything is fair to all, looks the same, feels the same and operates the same. And make sure this sYStem is kept up to date as the market changes around you.
Above all give your franchisee customers the same brilliant service you expect them to give their customers.
And if you don’t rate lOs in each case. you’ve work to do – immediately.
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