7 “Danger” Areas That Franchise Operations Teams Need to Watch

How field support teams can help improve performance by focusing on these key areas of risk 

Franconnect recently hosted a webinar to share strategies and advice around franchise operations. It was an honor to participate on the panel alongside Greg Nathan of the Franchise Relationships Institute and Dave Hood of iFranchise Group. There was so much data shared, as well as tips on how to better support franchisees, and if you didn’t get a chance to attend, I highly recommend you watch the recording.  

Some of the highlights included insights from Greg Nathan around the need for field consultants to be masters of many skills, and what traits franchisees value in their consultant as they look for ways to optimize and grow. They want their consultants to be business-minded, engaging, dependable, informative and considerate. If you haven’t read his Franchisor’s Guide to Improving Field Visits, we frequently (and highly) recommend that to franchisors. 

Dave Hood from iFranchise Group focused on shortening the time from signature to opening, and the importance of standardizing financial reporting and KPIs, along with the span of control- ratios of support staff to franchisees is crucial as you plan to support and grow the brand. 

I shared Franchise Business Review’s data on the top drivers of franchise performance, but what I didn’t get to share are the lowest rated areas for most brands – and even more important, how your field support and operations teams can address those areas to improve performance.

Based on our research of over 28,000 franchisees representing more than 300 brands in the last 18 months, we identified the seven areas rated lowest in satisfaction by franchise owners. We ask each franchisee 33 benchmark questions and score their level of satisfaction using our Franchisee Satisfaction Index (FSI), which ranges from 0-100. (Read more about our methodology here.) Year over year, we find that these seven areas are where franchise systems struggle the most when it comes to satisfaction and performance.

7 Areas Impacting Poor Franchise Performance

1. Profitability (59 FSI) 

Every meeting between field support and a franchisee should include significant discussion on how to help the franchisee be more profitable. Over the past five years, the role of the franchise coach has shifted from compliance to a business growth focus. Challenge your coaches to include at least one idea to grow sales, and one idea on how to reduce costs. Simple, easy-to-execute ideas should be favored, and results should be reviewed every 90 days. This is an opportunity to show franchisees you are focused on THEIR bottom line, not just corporate’s top line.

2. Marketing and Promotional Programs (59 FSI)

Most brands have multiple marketing programs in place at once. Have your support team simplify the options and focus on the programs that have the highest/fastest ROI for new franchisees. Also look at what types of additional supplemental programs you can put in place for mature franchisees who want to grow or expand.

3. Franchisee Involvement (60 FSI)

People join a franchise brand to be part of something bigger than themselves. Many fall into the personality profile of “Joiners” and want a sense of community and belonging. Your support rep/coach is the regular face of the brand for the franchisee, and their key responsibility should be to engage with franchisees and make sure their ideas and suggestions are heard and represented to corporate.

Field support staff can also play a critical role as a lobbyist or brand ambassador on behalf of the franchisees they represent, and help them identify opportunities to get more involved in the organization, whether through local peer groups, serving on various committees/FAC, volunteering to pilot new programs, etc.

4. Effective Technology (60 FSI)

Hopefully, your brand has in-house tech support and/or third-party vendors working with your franchisees to use technologies effectively. This can include your POS, business operating platform, financial reporting tools, your customer facing app, Google reviews, social media, and everything in between. Your operations support staff should be proactively monitoring these tools and demonstrating to franchisees how effective they are. If your technology is NOT providing value, field support should be reporting back to corporate so they can address issues with their vendors and partners and ensure the tools and programs you’re using are effective for franchisees.

5. Innovation (60 FSI)

Franchisees often report that new programs/initiatives are rolled out “half baked” and without enough advanced planning time to roll out effectively. This is where field support can play a significant role in creating awareness of new programs ASAP, involving franchisees in early testing/pilot programs, and making sure programs are “fully baked” before franchisees are asked to implement. In addition operations teams need to plan and support initiatives to ensure successful launch AND franchisee adoption in their markets. Most importantly, illustrating to the franchisees the ROI or efficiencies of the new innovations-(sharing the “WHY?” or “What’s in it for THEM?” – can help speed things along. Your FAC can also be a powerful influencer. Our Building a Franchise Advisory Council That Gets Results workbook walks you through how to use an FAC to get franchisees more involved and get greater buy-in.

Innovation happened faster during COVID than any other time. We saw franchisors quickly making changes that made sense for the franchisees to do business, and franchisees rolled with it. How can collaboration and adaptation continue at that same pace going forward? TALK about it in your network: what went well and how can that be used in the future?

6. Communications (64.8 FSI)

Field support teams are caught in the middle of corporate teams and franchisees. They have to balance the goals and needs of both, and be the liaison between them, including reinforcing corporate communications and highlighting key initiatives/programs whenever they are with the franchisee as well as listening intently and reporting the “franchisee experience” back to corporate.

7. Training & Support (64 FSI)

Grand opening and launch training and support is like drinking from the firehose for new franchise owners. Field support staff can help by breaking things down and/or simplifying processes for new owners. The “days to first dollars” – Keith Gerson’s term and focus over the many years we have collaborated with him – are obviously critical. How can field support staff map out key activities for owners to focus on, and coach them effectively through the first year? One way some of our clients have managed it is by creating specific support staff positions that handle JUST new franchisees for the first year.

On the other end of the spectrum, what value can field support bring to mature franchisees? Franchise Business Review’s Vision Plan Program is an example of how to clearly understand individual franchisees’ goals and make specific recommendations to achieve those goals. Aligning the support team and the franchisee on those goals creates accountability and focus. Having franchisees share with each other can also create peer accountability, and facilitate sharing best practices with each other along the way. 

Now that you know where franchisees overall rate their systems lowest, how do you think your franchisees would rate you in these key areas? If you want an objective assessment of how your franchisees rate you and how your system compares to the benchmarks in these areas, I’m happy to do a quick demo for you anytime.  

If you want to dig deeper into practical tips and tactics for improving performance, join me at the IFA’s Operations Conference in October. Programmed specifically for operations and field support teams, it’s the best place to get the latest best practices and learn what other brands are doing to improve performance. Let me know if we will see you (or your Operations team) there!