Yearly Archives

2019

How to be a Collaborative Franchise Coach

By | Franchise Coaching, Franchise Culture
collaborative franchise coach

The Collaborative Franchise Coach

Franchise coaches bridge a lot of gaps, including:

  • Franchisor and franchisee
  • Franchisee and key departments, such as Marketing
  • Crew members and training resources

The word synergy has fallen out of fashion in recent years, but the spirit of it of the sum of parts being greater than the whole is still going strong in the franchising community. Explore some of the ideas below to see how you can build more collaboration, and more effectiveness, into your role.

Look Below the Iceberg

As you take a look at a problem that you observe, you want to look into the root causes of each. Sometimes, the problem is shallow and a simple fix works well. But, other times, the problem is part of a something bigger – it is just the tip of the iceberg. For example, a franchisee may have their Holiday season promotion up in February – and who wants to see Santa when you are still paying the bills and losing the weight after an indulgent season? So – the simple solution is to get them to take it down and update it with the healthy winter promotion. But, what happens if it hits summer, and you as the coach see the February promotion sitting there? So – in this case, the wrong seasonal LTO is the top of the iceberg. Below the iceberg could be the following:

  • Maybe there needs to be training on obtaining and updating the promotion.
  • Perhaps the franchisee does not see the LTO as important – so it is a lack of priorities around it.
  • It could be that there is a weak relationship with the coach and they can say “yes” in the moment, but he or she does not respect the coach enough to actually follow through.
  • Finally, there could be a culture of “don’t care” going on in the case of a combative relationship between franchisor and franchisee.

There are many other things that could be under the iceberg. It is up to a smart coach and team to figure those out using both experience and intuition.

Focus on the Shift

Everything comes down to the shift – that is the simplest way to create more connections. Although many are “allergic” to math, connecting the math to the product can create a surprising level of motivation.

Numbers

Imagine you have a revenue goal of $5,000. Your crew can see that number, and maybe even remember it, but it may not translate into results until you give it meaning. To break it down, you can do the following:

  • Imagine you are a donut shop with a breakfast and lunch shift. In a month with 30 days, you can break that revenue goal down into $83/shift ($5,000/60=$83.)
  • Say your donut shop has a price for $11.95 for a dozen, 6.75/half-dozen and $2.35 for a large coffee. So – you could break it down to aiming to get 3 customers to buy a dozen more donuts, 3 to buy 1/2 dozen and 12 to buy large coffees.
  • Now, wheels can start turning. A guy who has a gift for connecting with customers, can recommend the delicious new cinnamon donuts for a customer who is getting snacks for a meeting – and boom! one of the dozens is complete. A crew member who is popular in the community invites a group of hockey moms to the shop for a coffee-chat – boom! the 12 coffee goal is complete. The guy delivering an Amazon order dwells near the donuts and is noticed by the associate at the counter – boom! another 1/2 dozen is sold. Accomplishing goals is better with everyone on board in a real way, and you can enjoy the victory together by offering recognition or even simple incentives.

Day Of

According to Jim Sullivan in Multi Unit Leadership, “many never consider the architecture of the revenue-generating shift and how managers need to vary their approach and style to effectively get the most out of each. It’s time our managers stop “running” shifts… and begin leading them. See the excellent video below for more tips on shift management.

Ask Purposeful Questions

Imagine you have a coach and a franchisee interacting. The coach imparted his knowledge at length, and came out of the conversation feeling like he had made an strong, meaningful change in the franchisee’s life. The franchisee, on the other hand, came out of the conversation feeling like the coach talked a lot, and he didn’t get a chance to share his biggest concern. The point is, no matter how brilliant or insightful the coach’s words were, they fall flat if the franchisee does not receive them. That is where purposeful questions come in. Here are some questions that Sullivan recommends:

  • What do you need to accomplish? Why is that important? How do you know? 
  • What do you think might be getting in the way of your success. How would you know? 
  • How would you know whn you were successful? What would it look like? 
  • Why do you think it is a problem? Have you noticed it before? If so, for how long? 
  • How have you addressed the problem? What happened? Why do you think that occurred? What if we can’t find a solution? 
  • How could you approach the problem differently to attain a different outcome? What are we assuming? 
  • What don’t you know that might be helpful to resolve the problem(s)?
  • What do you need from me to help you? How will you use that? 
  • What do your junior managers need? Why? What are their major obstacles? How do you know? 

This is not to say the coach is not to speak when there is a point to make. It is a balancing act between asking questions and speaking.

Last Word

The franchise coach’s role is known as the hardest job in franchising. While that pressure, sometimes there is a sense of needing to “know everything.” But there is a freedom to collaborating and connecting – it is the freedom to find answers and do the work together. It is also the freedom to share responsibility for the success that you build together as a team.



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Community Marketing Tips for Franchisees

By | Marketing

Community Marketing is a Mindset, Not a Department

Community Marketing is the one thing you want to get right for your franchisees. While you may have a Marketing team, branding agency or even a vendor that updates your social media, you can never outsource it completely.

For the 12 years that I have worked as a Franchise Marketing professional, I have seen dozens of vendors try to sell the “magic bullet” of marketing. And, just like a sales professional trying to sell an “easy” weight loss program, or a “fast” way to make money, they position it as a cake-walk once you make a hefty investment.

The truth is, Marketing IS just like getting to a healthier weight or making a more satisfying income; it is a step-by-step journey, where you learn along the way with true rewards at the end. But, it is certainly not a cake-walk – no matter how many people try to sell it that way. Take a look at the tips below, on how you can build community marketing into your franchisee’s day-to-day.

Build Meaningful Connections

“Within a 3-5 mile radius of every store or restaurant there are dozens of other businesses, hundred of homes and thousands of potential new customers,” said Jim Sullivan, in helpful his book Multi Unit Leadership. “Connect with community ‘influentials’. One American in every ten tells the other nine where to eat, what to buy and how to vote.”

Connecting with the movers and shakers of your community whether they are in local government, businesses, schools or community organizations can make a huge difference. And – you don’t always have to go straight to the top. Think of people who talk to others on a regular basis, Sullivan suggests: “hairdressers, hotel bartenders, receptionists, concierges, religious and civic leaders.”

Sometimes, the best opportunities are right before your eyes, and you can’t even see them. Every week, you have dozens of “invisible” customers walking through your doors – Amazon delivery people, wine merchants and event promoters to name a few. Do they get hungry or thirsty? Do they have any friends or family with upcoming events? Thinking of your own team can also be a potential revenue generator. The mean person had 200 Facebook friends. If they just recommend 5, that can have a meaningful impact on your business.

Always Be Marketing

Marketing is something that you want to have as part of every person’s day-to-day whether they are servers, managers, trainers or hosts. Jay Conrad Levinson, author of Guerilla Marketing said “Marketing is not an event, but a process. It has a beginning, a middle, but never an end, for it is a process. You improve it, perfect it, change it, even pause it. But you never stop it completely.” Every business is sales-controlled, but few have a true sales culture which plants marketing as the first step. Event-based “big deal” marketing programs still have a place, but they are nestled within regular, consistent programs.

Training Solidifies Marketing

According to Sullivan, “the more that you invest in training, the less that you spend on Marketing.” If your team provides superior service, the customer will come back, an even better, they will leave a positive review which has more credibility among customers than any marketing piece you have.  Additionally, you want training to enhance your marketing campaigns. The old advertising saying of “there is nothing that will kill a bad product like good marketing,” comes to mind. Now, more than ever, you want to make sure you follow through on the promises that marketing makes. With the speed of information, if you fall short, it may end up as a Twitter or Instagram #fail damaging the franchisees, their region and even the system as a whole.

Manage Moments of Truth

Jan Carlzon, in his game changing book Moments of Truth defined the term “as anytime that a customer comes in contact with a company’s brand, people, or services and forms an impression of the quality of service that they provide.” So take a step back and ask yourself, “what is marketing”? More and more, Brand is a verb, not a noun, so marketing is cleanliness, service and teamwork. It is every single touchpoint. As you are doing a Field Audit, see the store from the customer’s standpoint and think about what their impression would be. If you are looking for field audit questions, check out our popular eBook.

Last Word

The truth is, Marketing is a core part of any successful team’s DNA. Never outsource it, thinking of it as someone else’s job. It is a mindset that can change your business and life.



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Crucial Elements of Franchise TLC (Teaching, Leading, Coaching)

By | Franchise Coaching

Veterans of the franchise community know that the franchisee dynamic is different than that in the corporate environment. Rules are not followed automatically as a matter of course. There is a need to convince and find agreement.

According to Jim Sullivan’s practical book Multi-Unit Leadership, “Excellent companies don’t believe in excellence – only in constant improvement, constant change and constant training.” With this in mind, franchisee leadership is a thinking job, not a doing job. It is not an autocratic role for what food service Toni Quist calls “Inspect, Direct and Correct”.

The role of a Franchisor is to be a teacher, trainer and motivator. People come to the role with natural strengths, so as you read the below, keep those in mind, and see how you can strengthen them. Otherwise, you may come to the role with a need to learn. These tips on Franchise TLC should help you fill the gaps.

Teaching

A franchise leader has opportunities to teach franchisees every day, and every communication, including text, e-mail, store visits and e-mails can represent a potential training opportunity. That is why the “T” is for training in Franchise TLC.

Engage in Blended Learning

For every training objective that you have, it is a good idea to have three learning activities to support it. Sullivan calls it the “three-to-one rule of teaching.” For example, if you want people to get better at Online Marketing, you can ask them to watch a video from Google, do an exercise on managing vendors and answer question after reading through a case-study. To learn more about financials, working through a spreadsheet, doing a quiz then coaching with someone on your finance team is much more powerful than a monologue-style lecture.

Subject Matter Expertise Round Robin

Are you looking for a simple way to be a learning organization without wasting a lot of time? With just one hour a week on Fridays, your team can spend independent time growing the organization’s learning and connect that with the rest of the team. Each quarter, you can assign a key subject area to a franchisee in a given region such as hiring, retention, training, safety, marketing or service, for example. Once a quarter, hold a group webinar where the results are shared among each other. As the expertise rotates, different people will bring different perspectives, creating an interesting learning organization.

Leading

“The greatest leader is not necessarily the one who does the greatest things,” said Ronald Reagan. “He is the one that gets the people to do the greatest things.” Let’s walk through the “L” in Franchise TLC, Leading.

Define Symbols and Rituals

How does your franchise organization recognize achievements in terms of sales, service or teamwork? Whether it is certificate, pins, mentions at group meetings or even awards at the annual convention, it is a good idea to make a big deal out of achievement. After all, the more that you reinforce a behavior, the more of it you will get.

Getting unique symbols from your franchise’s own history  can also be an interesting exercise. Here are some tips:

  • Make sure social media pictures are also saved to a shared drive. In 5-10 years, those will be “history”!
  • Archive old menu editions, franchisee manuals, employee newsletters and other documentation.
  • Do a “call out” to franchisees to share the unique stories going on at their location. This can turn into classic tales of selfless service later.
  • Do a photo collage at head office showing key milestones such as first franchise, first recognition of diversity, 1,000th truck, first master franchise etc. This gives the feeling of being part of something bigger.
  • For key awards at conference, such as “franchisee of the year”, create a photo collage. It can be fun, if someone is a multiple winner, to show them going through life’s natural passages of time (though they may not always love the “crow’s feet” decorating the corners of their eyes, they will love the memories.)

Remember “SWAWC”

“When does somebody finally ‘get it’”, says Sullivan. “It all depends on how self-motivated they are to learn whatever it is you want them to “get.” Although, as a leader, you feel the pressure to motivate others, the hard truth is that people are self-motivated. That is why the acronym So What Who Cares (SWAWC) matters. When working with a group, imagine a cynical member asking that question, and find the answer. Once you determine the SWAWC, you can “meet your people where they are” and create positive change.

franchise knowledge gap

Coaching

Planting seeds of knowledge in the future is much more efficient than living in “reaction mode” and fixing problems from the past. Coaching is the “C” in Franchise TLC.

Assess Knowledge Gaps

Sullivan says, “Head Coaches start by assessing and clearly defining what their team already knows, what their team doesn’t know and what their team doesn’t know what they don’t know.” Assessing these knowledge gaps, the coach can create a game plan to realistically prioritize development needs and focus.

Tough on Standards, Easy on People

“Don’t confuse being disciplined with being a jerk,” Sullivan says wisely. A franchisor staff does not compromise on brand standards but is kind to the people involved. It is also a good idea not to focus exclusively on the weaknesses of your franchisees – you want to help them enhance their strengths as well, so they can be “the best of the best”.

Last Word

To stay competitive today, it is critical to keep learning alive in order to stay on track. “Coaching is another way of serving,” says Sullivan. “It’s a way of listening, nurturing, of passing on the lessons learned from experience to those who look to us for leadership.” Continuous improvement is about maturing within the organization and letting that wisdom contribute to everyone involved, while enjoying the journey.



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Springboard Session: Early Phase of Brand Scalability: Actionable Insights

By | Events
Franchise Springboard

Event: Franchise Springboard
Dates: September 18-20
Location: Philadelphia, PA

Your brand has validated its model and begun selling franchises. It’s time to develop a strategy for building the necessary manpower, enhancing franchisee support systems and solidifying culture to support the coming growth. In this session, we will discuss the different stages of growth and related inflection points, focus areas and action plans to get to the next stage, identifying if and when capital is needed for sustaining new unit growth, and how to propagate your culture from corporate operations to the franchised units.

Moderator: Jason Kealey – President, FranchiseBlast
Panelists: Paul Steck – COO, Spread Bagelry; Bryon Stephens – Co-founder, Pivotal Growth Partners; Jeff Herr – President, St. Gregory Development Group; Ed Samane – CEO, Pro Martial Arts Franchise Corp; Mike Weinberger – COO, ONE Cannabis GroupLearn

Learn more about Franchise Springboard 2019.

12 Surprising Things You Can Do On Your Next Franchisee Visit

By | Field Audits, Franchise Coaching
Franchisee Visit

A visit from an Franchise Business Consultant (FBC) can stir up a lot for a franchisees. Some can see the FBC as a checklist-wielding intruder, while others may see it as a major disruption, like the Kool-Aid man bursting into the side of their operations when they are trying to get stuff done. While using your checklist is needed, why not provide them with some surprise value during the franchisee visit? Check out the tips below to learn more.

Your Next Franchisee Visit

It’s Not What You Think 

1. Recognize Good Performance

A powerful, but underutilized tool is recognition. During your visit, the franchise and their team may think you are going to “catch them doing something wrong.” What if instead… you “catch them doing something right”? Reading out an e-mail from a happy customer, or a nod of appreciation from the President or one of the Directors of the organization can go a long way. Some franchisors even send their FBCs on the road with travelling trophies. After your visit is over, a thoughtful and gracious e-mail, text or even some fun and memorable photos circulated on social media or on your internal message board can be powerful. You can also provide some recognition to the hourly team such as a verbal thank you, an Amazon gift card or a “shout out” on Social Media.

2. Teach to Fail Forward

“When challenges and problems occur, find a lesson,” says Jim Sullivan in his game-changing book Multi Unit Leadership. “Find the lesson, share it with your team and discuss how to prevent the problem from occurring again. Problems are opportunities to learn from not get upset about.” Taking this approach will get your franchisee and their team to step back, and hopefully realize that you are there to help, not judge.

3. Know Details Matter

Have you ever guessed on the cleanliness of the restaurant as a whole based on the standard of clean you see in the washroom? Reminding the franchisee that the details matter is a great message from an FBC when conducting an audit. It is easy to let things slide a bit as an operator, and having a different set of eyes can make a big difference. For example, when you walked in, did the first person you meet greet you with a welcoming smile, or were they focused in on their phone? A customer, who has driven 20-30 minutes, past dozens of restaurants, would have that same experience – whether good or bad.

4. Be a Thermostat, not a Thermometer

Jim Sullivan talks about the idea of controlling the temperature, instead of reflecting it. While you want to meet the franchisee where they are, you also want to be the voice of reason. If you are getting as “hot” or as “cold” they are, you are not going to help. Having some self control, and remembering professional boundaries creates a win-win all around.

5. Consciously Collaborate

Like it or not, with Social Media and our “always on” society, our world is more and more collaborative. Information does not flow from the top down anymore; instead it flows bottom-up and laterally. Instead of resisting this idea, roll with it. Consciously collaborating means that you help the crew be a team feel energized after your visit and there is a little more glue connecting them together. You can also create collaboration with their fellow franchisees or other people who can broaden their professional or personal expertise.

6. Put a Loudspeaker on Great Ideas

When you see great ideas at play on your field visit, why not amplify them, and share them with the rest of the system? Of course, you only want ideas that don’t go against brand standards but it can be surprising how creative great operators can be within them. Don’t forget that for McDonald’s, Ronald McDonald, the Big Mac and the Egg McMuffin were all franchisee ideas. From Marketing to operations, there are ideas you could take and run with.

7. Judge People on their Best Days

Have you ever felt unfairly judged by someone? It is a sinking feeling, which you may be unconsciously be creating for your franchisees. “Be balanced, be fair, observe often,” said Sullivan. “And consider all the grey areas before you make a decision in either black or white.”

8. Encourage Excellence

While you want to create an atmosphere of acceptance, at the same time, you want to follow the management precept of being “hard on issues, and soft on people.” That means that if you see food being prepared at a level 10/10, encourage that again. Don’t forget that being on a “dream team” feels much better than being considered second-rate.

9. Foster Financial Goals

Unit Level Economics is a hot issue at franchise conferences because it matters from both a franchisee and franchisor perspective. Franchisors are typically paid on revenue, which can create a perception among franchisees of even the most well-meaning of head office teams. Helping your franchisee meet or exceed profitability targets will show that you are there to help in the most meaningful way possible.

10. Create a Not-to-do List

Productivity experts such as Tim Ferriss talk about having a not-to-do list. In fact, these can raise performance more than adding more to your schedule.  That list will demonstrate that you are not there to put more on an already full plate. You are there to help them succeed.

11. See Service through the Customer’s Eyes

It helps to see the operation from a customer’s point of view, rather than through that of the manager’s or staff. After all, a great customer experience, may not be what you think it is.

“Not having to ask for anything,” says Sullivan. “Is the ultimate definition of customer service. Most customers don’t actually ‘want service’. Based on the thousands of customer we interview annually for the service projects we do for clients, what customers want first and foremost from business is to eliminate dissatisfaction. Yep, that’s right. They don’t want ‘excellence’, to be ‘wowed’, ‘delighted’, ‘blown away,’ or whatever the service buzzword du jour is. Customers want consistent positive experiences characterized by the absence of complaints.

12. Mind the Gap in Alignment

“Mind the Gap” is something you see at the subway station, but that advice is also good for FBCs. An exercise, suggested by Sullivan, may be exactly what you need for your next franchisee visit.

  1. Before your visit, answer the following questions: 1) what are my customer’s top ten complaints? 2) what are my customers top ten expectations? Be sure to write down your answers.
  2. Ask the franchisee, their managers and the hourly associates the same two questions.
  3. Your service challenges and opportunities will become crystal clear, comparing the synchronicity, overlap and/or disconnect among the different groups.

Last Word

Looking for more ways to enhance your service? Check out our 5 Boosts eBook on how to enhance your Franchise Audit at every phase.



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Recruit the Ultimate Franchise Business Coach (FBC)

By | Franchise Coaching, Human Resources
Recruit Franchise Business Coach

The Franchise Business Coach (FBC) can make or break a franchise organization. As Jim Sullivan says in his seminal book Multi Unit Leadership:

“The best multi unit managers work wonders, bringing consistency to chaos, building bottom lines, wringing good things from bad locations, and strengthening the span of control between the owner and operations. The worst can just as easily bring the company down through inattention, inexperience and ineptitude, forgetting that all operation problems boil down to people problems.”

Like Multi Unit Managers, Franchise Business Coaches are key to helping franchises succeed, but finding the right one, and training them appropriately is not an easy task. Check out the tips below on recruiting the ultimate FBC, and setting them up for success.

Franchise Business Coach (FBC) Recruitment Process

Write a Killer Job Description

Entrepreneurs in Silicon Valley and beyond still dream about the “killer app” but, what does it take to have a “killer job description” for a Franchise Business Coach? It is all about people. In a nutshell, in 2020, fashion mavens may tell you that sage green is the new black. But business experts will say that marketing is the new recruiting. As a result, recruitment has surprising similarities to marketing copy. Here are some tips for a killer job description:

  • Do your research: According to Sullivan, “talk to people who have already ‘bought’ your product (your current team members). Find out why people want to work for your company; is it the culture, growth, people, pay?”
  • Be descriptive yet concise: As an employer, it is important for your employees to understand their role from day one. It is better to overcommunicate than undercommunicate.
  • Hire for culture: Are you a “sales first” culture? Then talk about that in your description. Are you driven by a deep entrepreneurial spirit at the office? Put that in there. You want to hire for culture, otherwise, the person could create some unwanted waves.
  • Focus on benefits: If there was one nugget of information from a career in Marketing, it is to focus on benefits instead of features. For example, Uber’s job description focuses on money, flexibility and “no boss”. When people are seeking work, they are looking for “what’s in it for me” so empathy is a good skill to draw on when building your description.

Screening Candidates

Now that you have your description, you can begin screening Franchise Business Coach candidates. Traditionally, this starts with a phone interview, then gets whittled down to face-to-face. Since candidates will be remote, some opt for video interviews either as the first or second stage. Creating a team is like crafting a meal – you want to have all of the elements balanced for it to be delicious. So – for a “dream team”, you want to think of how the skills of the FBC connect with the Director of Operations.

Some people opt putting this dream team on paper, sketching out the skills of each team member. FBC candidates can come from inside or outside of the organization. The ones from outside may bring in new skills and a broader perspective; they will also bring both good and bad habits.  So keep in mind that those outside hires may need less step-by-step guidance, but more indoctrination into the culture.

Selecting

According to Sullivan, “people are not your greatest asset, the right people are.” You can never be too picky – the franchising community has long held onto the axiom “hire slowly, fire quickly”. With 90% of candidates C and D players, you want that A or B player urgently. Because realistically, a C or D player does not surround themselves with A players so a FBC with recruitment responsibilities will have an exponential effect in either direction. After the selection is complete, you can offer employment.

Onboarding

A widely recognized challenge in the world of FBCs is the lack of formal training available. An FBC is part coach, part manager and part auditor. This multifaceted role means that already defined training program will not reach. The sad truth is, that often people new to the organization will get a one-day driving tour a training binder and an org chart as their orientation. Then, it is trial by fire. Alternately, here are some best practices when it comes to onboarding:

  • Assess both the knowledge base and the knowledge gaps of each new hire. Role plays, case studies, interviews and questionnaires can be used to test knowledge and motivation given the work setting.
  • Executives should share their long-term visions giving the new hire the same information as the current FBCs have. This will give them insight into their future responsibilities and assess their own physical, mental and emotional abilities in the new role.
  • Consider mentoring your FBC an ongoing process. The orientation process should start with a thoughtful 30, 60 and 90-day onboarding plan. Having both vertical (bosses) and horizontal mentors who have some coaching skills can also be a great help.
  • With the supervisor, the FBC can review the following:
    • Quarterly business plans: the good, the bad, and the difference between the two.
    • Sample visit: review how much time the FBC is expected to spend at their stores and conduct a sample site visit using your mobile operations field audit app. Time should be spent afterwards debriefing and deconstructing the visit.
    • Strategy: the supervisor and the new FBC should do a SWOT analysis on each location and discuss the idiosyncrasies of the location and the history of the surrounding market. Looking at analytics based on previous store visits is a great benefit, using your operations software.

According to Sullivan’s research, coaches that take outside training courses annually perform better, produce more and stay with their companies longer.

The Next Step

Are you ready to take the next step? Check out our eBook, 5 Ways to Boost the Impact of Your Franchise Field Audit.



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How Port City Java Made a Strong Comeback into Franchising

By | Battle Tested Strategies, Customer Testimonial

Port City Java, founded in Wilmington, North Carolina in 1995 is known for their strong coffee, and now they’ve made a strong comeback as well. In the 90s, they started expanding throughout the Wilmington market with just corporate locations and started franchising in 2003 with 100 agreements signed at the peak.

According to Sarah Meriam, Director of Franchise Operations, in their initial execution of franchising, they made a few common mistakes which halted their growth temporarily. Using these mistakes as learning opportunities, the brand was able to recognize the crucial gaps in their system and made the decision to take a step back and restructure. Around 2007, they put a pause on traditional franchising so that they could refocus and reboot the system.

Port City Java franchising officially relaunched in summer of 2018 and the company started getting back into traditional franchise growth. With 12 corporate and 15 franchise stores they are choosing the right franchisees and being more data-driven than they were before. We sat down with Sarah to learn what changed and how she sees the future.

What would you say is the biggest thing that you’re doing differently as you’ve reemerged?

Sarah: “We’re really focusing on the type of operator that we want in our system and being able to support our brand partners effectively. To do this, we are not reemerging with the goal of becoming a national brand but instead committing to controlled, regional growth for now.

“From my point of view, as an operations person, that’s one of the biggest mistakes that we made initially. We had no way of supporting a store in California from here. Making sure that we’re not growing beyond our means and truly supporting the franchises is key.”

What sets Port City Java apart from the competition?

Sarah: “Competition for us is many different forms from the big-name brands to local coffee shops to convenience stores. To stand out, we focus on product quality and guest experience. During our initial onboarding and training of employees at any level in the company, we make the distinction between ‘service’ and ‘hospitality’ a primary message.  Service, as we say, can be transactional but hospitality is going above and beyond and truly creating an experience for the guest. Ideally, this keeps them coming back.

“On the product side of things, we have an in-house roasting operation at our corporate headquarters in Wilmington and with our team’s hands-on approach, we take a lot of pride in delivering the highest quality coffee to our guests and café operators.  At the café level, we are constantly evaluating our operations and training so that all staff members uphold the same level of quality throughout.”

When did you implement FranchiseBlast, and what was the reason?

Sarah: “We started in 2017 and our primary reason was for the auditing software. Before then, we were on the pen-and-paper audits that were ineffective. We had no efficient way of collating and assessing results for one unit, let alone our entire system.

“When we were first introduced to the FranchiseBlast tool, the timing was perfect because we were behind on the technology aspect of things. Getting upgraded to this kind of software was a primary focus of mine to make significant improvements to our auditing process. With the technology in hand, we can be vastly more efficient with our units before, during and after completing café audits.

“The auto-generated report is sent to operators and management staff immediately upon approval, but we also include a follow-up email, based on a template our Franchise Business Consultants (FBCs) have created, to highlight key areas of opportunity as well as positives. We build in as much redundancy as possible. FBCs are trained to take as many notes and pictures as possible during the audit, which is another big advantage.

“Even if the operator is not in the store during the audit, they know exactly what we’re talking about without needing a full explanation or time-consuming follow-up about what needs to be corrected or improved.”

What would you say the biggest strength is of FranchiseBlast?

Sarah:  “Definitely the software’s ease of use and support team behind the scenes. Everything is straightforward, simple and effective for our use of it. If there are ever any questions that arise or anything that we might need further coaching or explanation on, we go to the support team. Everyone is incredibly responsive and helpful, and the team is always willing to take feedback.”

In your day-to-day, what feature helps you the most as you manage your FBCs?

Sarah: “Being able to look at the audit reports from multiple viewpoints has definitely been the most beneficial aspect. We organize our system into various categories within the software so that we can isolate reports in the most effective way. I can view reports from the system as a whole, franchise versus corporate, drive thru versus non-drive thru, or even broken down by FBC territory, just to name a few.

“Having the ability to see audit results from all of these angles helps to assess issues that may be happening across the board versus metrics in specific locations. It gives our team perspective when adjusting action plans or coaching the FBC and helping them come up with a plan to correct that behavior or issue. It also gives us the ability to look at and use historical data from previous audits reports to better document ongoing or repeat issues that may require escalation.

“Being able to categorize and review all of audit reports helps us isolate the root cause of the issues. We can assess ‘Is this a specific café problem? Is this a problem for all drive thru or University cafes? Is this a system-wide issue?’ Answering these questions with concrete data determines the necessary action that we, as the franchisor, might need to take whether it be coaching one operator or a broader change to training/educational resources. Being able to have some flexibility with the different types of reports that we can pull and assessing that data from a lot of different angles is invaluable.”

What’s the overall impact of FranchiseBlast on Port City Java?

Sarah: “One of the obvious impacts has definitely been improving our unit compliance.  For example, we’ve seen almond milk utensil and pitcher handling jump from 38% compliance in 2017 to 98% compliance in 2019. We fortunately never had any allergy reports, but without FranchiseBlast in place, we would not have had the data to show the gaps in training to ensure everyone staff were always following proper protocol .

“That said, I also feel like we’ve been able to show our operators the value of audits as a coaching tool to help them, and ourselves, make improvements instead of just focusing on a compliance score. We’re very transparent about how we use these results to score ourselves as the franchisor. This is not only in the audits that are completed in our corporate stores but around system-wide weaknesses which reflect gaps and opportunities for improvement in our training initiatives.

“Aside from raising compliance scores with the almond milk procedures we first noticed, we can look at two additional metrics from our system as great examples of how we have used the collected data to improve our training initiatives:  espresso quality and suggestive selling. Within the first few months of adopting the FranchiseBlast software, we noticed that the majority of our cafes were consistently scoring very low in espresso quality.

“With our coffee quality being of the utmost importance to us as a brand, we used the information gathered from the audits to assess where we had gaps in our training materials that would result in quality issues.  We were able to add to and improve those materials to ensure cafes had the best tools and resources to maintain the standards we want to achieve.  Since then, we have seen consistent improvements in scores and, even more importantly, the quality of products being produced.

“These areas of opportunity tied nicely into our overall goals for 2017. In preparation for relaunching the franchise, we wanted to ensure our brand was differentiated in terms of hospitality and product quality, but more specifically we wanted to improve the unit-level economics of our cafés. FranchiseBlast highlighted that we had an area of opportunity around increase average check sizes via suggestive selling. We decided to address this opportunity first, as it appeared like lower hanging fruit than increasing customer counts.

“As a result, in the second quarter of 2017, our FBCs focused on the topic of suggestive selling during their conversations with franchisees and store managers while our training department built supporting materials. Around the third quarter of 2017, we started making these training materials widely available for consumption. We promoted them even further in 2018 and still today in 2019.

“We are always looking for opportunities to make improvements but by including assessments of suggestive selling in our two primary audits and providing cafes with further training and feedback, we had a nice impact on our average check size.

Check Size Chart

“That first quarter, when we ramped up with the software, we saw the average check size increase by an average of 2.3%. The second quarter showed an average increase of 3.52% over 2016 while third and fourth quarters accelerated the upwards trend with 5.16% and 5.96% increases respectively. Although not shown here, we saw continued increases throughout 2018 until the unfortunate events of Hurricane Florence impacted our area cafes. We’ve now recovered and are growing strongly once again.

“Obviously, there are numerous factors at play and while we’re not claiming FranchiseBlast is solely responsible for our continued improvements with these metrics, the timing lines up with our brand’s desire to make more data-driven decisions and conscientiously work towards advancing our system overall.

“From my perspective as a coach, it’s great that our efforts are reflected in the results, but I don’t want to be stuck looking at numbers on a spreadsheet all day! The data helps us make more informed decisions about our processes and priorities, but it is still up to our frontline staff to get it done. Having these tools available improves the level of support we are able to offer to build their confidence as operators and show them how what they do on a daily basis adds up!”

What advice would you give to someone trying to do your job?

Sarah: “I always advise people that the two biggest lessons I learned after getting into franchising were: always celebrate the small victories and recognize the value of answering the question, ‘why?’ before it even gets asked. Having grown up with the PCJ brand in Corporate Operations, I came to our Franchise Department with an unrealistic ideal of what it was going to be like working with franchisees.

“I took for granted the fact that I was now working with business owners, not just other managers, and I had to justify every decision that was being made and answer as many questions as I could think of before they were asked. As a department, our mantra is, “front load everything.” While it was frustrating at first, I quickly learned there is tremendous value in doing this. By answering the ‘why,’ and offering that level of transparency, we continue to build trust with our franchisees. “



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How to Use KPIs in Franchising

By | Franchisee Scorecard, KPI
KPIs in Franchising

Most franchisors are aware of KPIs and management. but going from “idea” to “roll-out” can be too big a chasm for many franchisors to overcome. But in today’s world, which is both highly competitive and data rich, KPIs in franchising are becoming a must-have to succeed.

The management style connected with KPIs is especially important in franchising. You are working with entrepreneurs, not employees. Franchisees are more independent and have to be convinced about initiatives rather than being led. This can turn many with a corporate background into a state of frustration.  But this challenge, to the right mind, can be seen as a strength. An entrepreneur, worth their salt, will be motivated to succeed and will draw on the “I’ll do what it takes” mentality. This situation sets the stage perfectly for managing via KPIs in franchising.

  • KPIs motivate: Traditional management talks about “the carrot or the stick” as the two sides needed to manage effectively. In terms of the carrot, KPIs motivate, especially when they are displayed together with leaderboards.
  • KPIs monitor: In terms of the stick, KPIs help make clear what the expectations are for a franchise. After all, a franchisee is granted the right to operate the franchisor’s brand, thus there are obligations associated with this right.

How to determine KPIs in Franchising

Your KPIs are as unique as your business. As a result, determining your KPIs can come from the following sources:

  • Industry experts: whether your franchise operates in restaurant, automotive or health and fitness, you will typically be able to find an effective, numbers-oriented expert in the space. These folks will typically come from a management background, but they can also be found with on an engineering, software or financial career-track. Look for them at your industry conferences or publications.
  • Franchisees: As people familiar with the day-to-day of the operation, franchisees can be a rich source of input into KPIs. Getting them involved also facilitates compliance and alignment down the road. Look to your Franchise Advisory Board as a starting point.
  • Internal team: Your internal team can be a valuable ally when it comes to KPIs. Your Franchise Consultants are a first stop on the road to KPIs, but you may want to check in with Marketing, HR and Training teams as well.

Sample KPIs

As discussed, KPIs are unique to every business. But sometimes seeing samples of KPIs in franchising can spark discussion and build intelligence. Due to popular request, we have sample KPIs in the following areas. To get statistics for this post, we relied heavily on the Franchise Business Outlook published by the International Franchise Association (IFA).

Restaurant Franchise KPIs

Numbers: According to the IFA, there were 226,699 Fast Food, Quick Serve and Full Serve restaurant establishments combined in January 0f 2018. This means that out of the 759,236 franchise establishments, restaurants were 55.5% of all franchises. It stands to reason that restaurants are still going strong in franchising.

Trends: The biggest change to hit restaurants are off-premise sales. Delivery, led by the pizza world is taking a bite out of the industry as a whole.

KPI Samples: Speed of Service, RevPASH, and % of Online Orders are indicators found across establishments. See our full list of Restaurant KPIs here.

Salon and Spa KPIs

Percent: Personal service, which includes Salon and Spas, represents 113, 536 establishments, representing 15.1% of franchised businesses. In 2015, the global wellness industry was valued at 3.7 trillion dollars.

Trends: Digital disruption is affecting salons and spas, with businesses offering apps and online appointment setting. 70% of Spas, for example, offer online appointment setting.

KPI Samples: Retail Capture Rate, Repeat Guests, and GOPPATH are KPIs found in this industry. See our full list of Salon and Spa KPIs here.

Gym and Fitness KPIs

Percent: Gym and fitness is also included in the booming personal services franchise category, which, same as Salon and Spas, represents 15.1% of the franchises. Currently about 20% of Americans have a fitness membership, and that could easily double in the next 10-15 years.

Trends: Wearables sharing biometric data have emerged as a top trend in fitness today.

KPI Samples:  Active Members, Revenue/Client, and Revenue per Square Foot are KPIs seen in fitness businesses. See our full list of Fitness and Gym KPIs here.

Automotive KPIs

Percent: There are 38,065 Automotive franchise establishments in the US, representing 5.0% of franchises.

Trends: With new automotive sales on the decline, drivers of older cars are more likely to pay to keep their car running, with the average older car owner 2x more likely to pay over $1,000 to keep their car running.

KPI Samples: Productivity, Efficiency %, and Cycle Time are common in this industry. See our full list of Automotive KPIs here.

Education KPIs

Percent: Education is also part of the broad Personal Services franchise category, weighing in at 15.1% of all franchises.

Trends: STEM Education support is a trend in education, with the Bureau of education forecasting a million new jobs created in Science, Technology, Engineering and Math between 2012 and 2022.

KPI Samples: Trial Conversion, Attendance %, and Churn % are typically found here. See our full list of Education KPIs here.

Types of Franchise KPIs

KPIs come in many different forms. See the infographic below as a guide.

KPI Best Practices

When rolling out a KPI program, it is important to remember that the program is a living and breathing organism, rather than something static. Here are some tips to keep in mind:

  • Don’t Set it and Forget it: The beauty of this program is that it helps you track your progress. That means having positive habits around review cycles is a must-have.
  • Review Consistently: As new trends come into your industry, you want to review and change what you monitor. For example, 5 years ago restaurants did not typically track % of online orders. Today it is standard.
  • Tie to Scorecards: Scorecards offer a one-page summary of what is going on with the business. This is a great user-friendly tool for franchisors and franchisees alike.

Parting Thoughts

Once you have your KPIs in place, you may want to invest in a scorecard program to make them easy and understandable. FranchiseBlast has created a comprehensive eBook on Scorecards called The Ultimate Guide to Franchisee Scorecards. Download this valuable resource now.



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Unit Level Economics for Franchise Businesses

By | Uncategorized

We have all heard that Unit Level Economics is important in franchising, but going from understanding it in theory to transforming it into action is a big step.  According to QSR Magazine, “the success or failure of a franchise concept can pivot off of how well unit economics are tracked, managed, and improved.” In this article, we will take a look at why Unit Level Economics are important in a franchise business, and how to put it in place in your organization.

Why Unit Level Economics for Franchise Businesses

Strong Unit Level Economics is the foundation upon all business success sits. Even though most franchisors get royalties from revenue, not profit, having franchisees succeed in the long run creates genuine referrals and organic growth. Those who want sustained growth for both the franchisor and franchisee pay close attention. According to Joe Matthews, strong Unit Level Economics can also help in Franchise Development as franchise candidates look for the following:

  • Does your business make money?
  • Is the business sustainable? Will it continue to make money into the foreseeable future?
  • Can I see myself in the business?

So the focus builds that franchise business from many angles.

Core Measurements

The starting point of a Unit Level Economics initiative will take the following into account:

  • Unit Profit  and Loss (P&L)
  • Break-even point
  • Payback period

Key Performance Indicators (KPIs) take center stage when it comes to any program rollout.

Sample Unit Level Economic Program Rollout

Are you ready to rollout a program? Surprisingly, we have found that sometimes more established systems are behind newer systems who may have set up strong programs  from the beginning. The best rollouts start from the top, where the Owner or CEO sets the tone and the franchisor team is full of people who care about franchise success on an emotional level.

Step 1: Determine the Key Performance Indicators (KPI)

Every business is different, so using the wrong KPIs can do more harm than good. Develop these benchmarks with input of the franchisees and industry experts. As a starting point, we have KPIs for Restaurant, Health and Fitness, Spa and Salon, Education and Automotive.

Step 2: Track and Improve KPIs

Now that you have the information that you need, you can manage your KPIs together with your franchisees. Franchisors who have a “corporate location” have more skin in the game and can experiment with the business model. Having franchise committees or forums can also help develop and share best practices. Another way to encourage performance is to have part of your franchise consultant’s salary variable based on franchisee KPIs.

Step 3: Share Information About Your KPIs 

Sharing information about KPIs is key to an organization’s success. In fact, at FranchiseBlast we have seen an increasing amount of customers tracking scorecard performance on a monthly basis as well as getting information from their POS or online reviews.

Critically Reassess the Basis of Controllable Franchisee Variable Costs

The franchise landscape changes over time. For example, off-premise has appeared in a substantial way in the past few years leading to changes in procedures, facilities and digital assets. Reviews have also taken a front-seat in  marketing, when as little as 5 years ago they were a second thought. Reassess those KPIs over time, making sure your programs are relevant.

Parting Thoughts

Overall, a strong Unit Level Economics program is alive, with participation and tracking throughout. To learn more, download our Ultimate Guide to Franchisee Scorecards.



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CEO’s Guide to Creating and Maintaining a Positive Culture in Franchising

By | Franchise Culture
Franchising Positive Culture

Business culture exists in every company, whether it’s managed effectively by the leadership team, or is the result of neglect.

A positive culture significantly impacts business productivity and profitability by enhancing team commitment to the goals of the enterprise. Conversely, a negative culture disrupts the ‘team spirit” and significantly reduces cooperation among team members, increases turnover, and reduces productivity.

In many ways, franchise organizations are even more dependent upon a positive culture than other business models. Franchisees are independent business owners, typically with entrepreneurial spirit, and less inclined to follow instructions than typical employees and managers. Many franchisors are looking for alternatives to the cop perception of franchisors, and want to make compliance a part of the culture.

To help franchisors in our community, Franchise Business Review, an independent market research firm that has partnered with over 1,100 top-performing franchisors, has created a guide, that will help you:

  • Learn about what culture means in the franchise context
  • Several real-life examples of culture programs in action of top franchisors
  • 12 steps on how to build a positive franchise culture

Download the free guide

Why Culture Matters in Franchise Systems

  • Increased engagement
  • Increased performance
  • Compliance is more likely
  • Creates consistent behaviors across the organization (because they WANT to)

Despite its critical importance to organizations, culture is frequently overlooked by leadership, and the result is an organization that lacks clarity and purpose. Leadership is responsible for the creation and maintenance of a positive culture that creates alignment of team behavior and company values, as well as aligns individual employee goals with those of the enterprise.

The best leaders personify their vision, mission, and passion. Only through authentic values and principles can you provide clear organizational expectations that drive norms and motivate employees at all levels.

6 Elements of “Leader” Driven Culture

  1. Vision – a leader’s basic job.
  2. Mission – innovative and inspirational.
  3. Relationship – lead by example.
  4. Employees – must align team goals and objectives with company values and mission.
  5. Accessibility – continually connect and share knowledge with the team.
  6. Business Acumen – strong skills for today’s business environment.

 

Ready to Make Positive Culture a Priority?

In many ways, franchising IS culture. The same attitude, the same behavior, the same tools, even the same words used in each franchise location, impart the culture of the brand. Each location may have some flexibility in how they deliver service, but they can’t be so far from the standard to undermine the underlying franchise brand “culture” as perceived by their customers.

This eBook will examine the three foundational components of a positive culture—and provide practical advice for franchise leadership teams for creating and maintaining a culture that leads to greater productivity and profitability.

 

Download the free guide

Capture franchisees’ feedback on your culture and franchise community with Franchise Business Review’s Franchisee Satisfaction Surveys, and measure and improve employee engagement and franchise culture at the corporate and/or franchisee level with Employee Satisfaction Surveys.

Michelle Rowan FBR

About the Author: Michelle Rowan

Michelle is the president of FBR, vice chair of the International Franchise Association Women’s Franchise Committee, and a Certified Franchise Executive. She has facilitated CEO Performance Groups and Executive Networking Groups and is also a mentor of UNH college students. When she is not at work she is usually reading, playing outside, or hanging out with her husband and daughter.