Category

Franchisee Scorecard

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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15 Important Restaurant KPIs

By | Franchisee Scorecard, KPI, Restaurants
Restaurant KPIs

The majority of restaurants are franchised. The 2012 US Economic Census numbers say: “the estimated 122,042 limited-service franchise restaurants (NAICS 722513) make up approximately 54 percent of all fast-food restaurants in the United States, nearly 70 percent of the sales of fast-food restaurants ($185.4 billion), and about 73 percent of the employment of fast-food restaurants (3.6 million).”

So – how do you effectively manage a restaurant in terms of Key Performance Indicators (KPIs) in the franchising environment. See our list of 15 helpful KPIs below.

Sales and Marketing

Average Online Rating

With 91% of 18-34 year olds trusting online reviews as much as a personal recommendation, and consumers willing to pay 31% more on a business with positive reviews, there is a great reason why this should top the list for restaurant KPIs. The average star rating, along with the number of ratings within the last month or quarter is the right place to start.

Net Promoter Score (NPS)

NPS is a customer loyalty metric which rates customers as a Promoter, Detractor or Neutral depending on their answer to the following question: “How likely would you be to recommend us to a friend or family member?” on a 10-point scale. Promoters are 9-10, Neutrals are 7-8 and Detractors are 0-6. It can be calculated as follows:

NPS =  (%Promoters)-(%Detractors)

CSAT is also a popular way to measure customer satisfaction.

Number of Transactions

Number of transactions is a way to assess customer count. This can typically be retrieved from your Point of Sale (POS) system.

Average Check Size

Some restaurants prefer looking at this simple metric over worrying about upsell metrics. Essentially, a strong average check size shows that the location is getting more from each of their customers. It can be calculated as follows:

Average Check Size=(Total Sales)/(Total Transactions)

Number of New Loyalty Program Members or App Downloads

Loyalty programs and apps matter in the restaurant space, since increasing retention by just 5% through customer loyalty programs can boost revenue by 25 to 95%. Measuring this helps keep the franchisee’s eye on the ball when it comes to this vital activity. Another way to look at this is % of transactions using the loyalty app.

Service

Speed of Service

This is a great one for increasingly time-starved customers, and it does not require any new data points. Measure this automatically from time the customer walks in or drives up to your restaurant through the  POS, to the time when the food is delivered to them based on your kitchen display system. Some compare this to NPS as well.

Speed of Service=(Food Order Time)-(Food Delivery Time)

Customer Retention Rate (CRR)

Customer retention rates vary greatly depending on the location and the size of the restaurant. For example, you would expect the CRR at a location at the airport to be low, given the audience in transition. This metric can be measured using the following formula:

CRR=((#of customers at the end of the period)-(# of new customers for that period))/(# of customers at the start of the period)

RevPASH (Revenue per available seat per hour)

If your franchisees have empty seats, their profitability is likely suffering. If you watch this metric hour by hour, you can make adjustments to improve the bottom line.

RevPASH=(Revenue/hour)/((Available Seats)/(hour))

% Online Orders

With Off Premise sales becoming such a major part of franchising, this is a great metric to start with. The only caution is that you don’t want to punish those that are growing their revenue in the traditional business. Online orders also tend to have a bigger check size.

% Online Orders = (Online Order Sales)/(Total Sales)

Expenses

% Labor Costs

You may want to split your hourly staff wages versus your manager wages. Some owners-operator franchisees pay themselves a salary. Others pay themselves a dividend out of the profits for tax purposes. By carving out hourly wages into a separate entry, values become more comparable when benchmarked against the system.

% Hourly Labor Costs = (Hourly Labor Costs)/(Total Revenue)

% Food Costs

You should have the actual cost of the items you sold in that period so that you’re properly evaluating profitability. However, some systems don’t have this data easily on hand and they make an approximation using ‘purchases’ during that period. These two numbers don’t necessarily align, so be careful. Make sure you use consistent information for each unit.

% Food Costs = (Purchases)/(Total Revenue)

% of a Strategic Category

Some franchise systems have a very successful category with great profitability, such as soft drinks. Selling a bigger percentage of soft drinks, or whichever that category is within your system is a great start.

% of a Strategic Category = (Category Sales)/(Total Sales)

Food Cost Variance

A metric a lot of franchisors are talking about today is the actual cost of food compared to the planned cost. Tracking this helps track forecasting and handling fluctuations in certain costs such as beef in the future.

Food Cost Variance = (Actual Food Cost)/(Planned Food Cost)

Employees

Employee Turnover Rate (ETR)

Every industry has to deal with turnover, and it is a good idea to determine what is an “acceptable” number in your system.

ETR= (# of employees who left in that period)/((# of employees at the beginning) + (# of employees at the end))/2

eNPS

Similar to Net Promoter Score for customers, above, the Employee Net Promoter score can help you understand how happy your team is. Though some franchisees are hesitant about measuring employees this way, it can add insight – and happy front-line employees mean happy customers.

Ready to Go Further?

Looking for more KPIs for your Franchise? Look at our post on how to use KPIs in Franchising. If you are ready to go one step further, check out our eBook: Ultimate Guide to Franchisee Scorecards.



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CFA Roundtables: Franchisee Scorecards

By | Events, Franchisee Scorecard
Franchisee Scorecards

Dates: Monday, April 8th, Tuesday, April 9th, 2019 at 11:30
Location: Niagara Falls, ON, Canada
Hosts: Monday: Jason Kealey, Tuesday: Stefania Sigurdson Forbes

Why Franchisee Scorecards?

One of the biggest trends of 2019 is Franchisee Scorecards. This simple but powerful tool helps you understand what is happening with your franchisees. At these roundtables, we will chat about what metrics are most relevant to franchisors and which ones will drive growth for franchisees.

To join us, register for the CFA convention.

4 Reasons Why Usability Is the Most Important Factor in Franchise Technology

By | Franchise Audits, Franchisee Scorecard, Franchising Trends
Why usability is important in franchise technology

Franchises across many verticals have made significant investments in franchise technology from point-of-sale systems to cloud computing. However, many times these investments fall short of their potential because franchisees, or even head office, do not use them. Franchisors then are on the hook for expensive annual agreements while the technology sits unused. One of the top reasons the investment is wasted? The lack of usability.

What is Usability?

According to Simple Usability A satisfied user…
• Achieves their goal
• Enjoys their experience
• Tells others
• Comes back again

Basically, if the franchisee were to use the franchise technology provided and actually return to it and use it again – multiple times, they are a satisfied user.

A usability expert would say that the ultimate application would not even need a manual. It would be a matter of pressing the start button, and the rest would be intuitive. Kind of like how simple it is to order your Friday night pizza online.

Unfortunately, many users blame themselves for not being able to use the franchise technology easily. But the truth is, it’s the software engineers and developers themselves who have it wrong if it is not intuitive for people to use.

So why is usability so important? Let’s find out more below.

1) We are All Multitasking

In a busy franchising environment such as a restaurant, health club or doggy daycare everyone is multitasking. Tasks need to remain simple so that when you are, for example, checking in a client and accepting payment, you can still be 100% with your customer. Being distracted and fiddling with technology when you should be engaging your client can have a negative impact on your business.

This is so important that some of your best franchisees will choose their customers over technology – after all, their customers are why their business is successful!

2) Mobile Rules

Have you ever gotten annoyed while trying to select that tiny type in a menu while using your mobile device to navigate a website?

It’s frustrating!

It’s enough to make many people exit and not return and is the reason why Google rates usability so highly in their Search Engine algorithm.

With so many things from audits to taking customer payments happening on mobile devices from the size of an iPad to phone screen, having a simplified, mobile responsive design to reduce “big thumb” syndrome is crucial to ensuring a satisfactory experience.

3) Not Usable = Lost Users

With the expansion of mobile devices and the online marketplace, the number of competitors for just about everything has exploded.

There are so many apps on the market that can solve your problem in one way or another. If your franchise technology isn’t simple to use, your franchisees (or their staff) will turn to something else. You then, as the Franchisor, will lose control of important data.

Losing control of data can not only slow the growth of your business by restricting what the information you have to make important decisions, you also will be unable to take advantage of big data applications since everything is not all in one place.

4) We Have No Time to Waste

It’s like Mario Karts out here – it’s an increasingly competitive world. You slip on a banana peel just in time to have to avoid a Koopa shell. You don’t have time to waste with software your franchisees will not use.

Wasting time on double-data entry or using a workflow that does not make sense is a waste of time, time that could be spent adding to the bottom line. And as we all know, time is money. Time is value.

Lawyers talk about “billable hours”. How many hours are actually adding to your bottom line, and how much of it is simply “busy work”?

Looking for something more usable?

FranchiseBlast is widely recognized as the most usable audit app available to Franchisees. Our workflows match those of the Franchise Business Consultant.

With a mobile-first design your franchisees will be able to easily use the application from whichever device they prefer. And with our simple design, they can give easily multitask between using the franchise technology and giving their customers and employees the attention they need.
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The Ultimate Guide to Franchisee Scorecards

By | Franchisee Scorecard

A franchisee scorecard is an all-in-one resource for franchisee engagement, operational efficiency, brand consistency and system compliance. Due to popular demand, we created this step-by-step guide including:

  • How can scorecards improve franchisee engagement?
  • What risks will scorecards reduce?
  • What sections should be included?

There is also a scorecard library, including samples across different verticals including restaurant, home care and more.

Download the Ultimate Guide to Franchisee Scorecards now.

 

Top 5 Reasons Why Franchisees are not Using your Fancy Analytics or Dashboard Solution

By | Franchisee Scorecard, Thought Leadership

In this information age, everyone talks about how you need to track everything in franchising. And you can! From click through rates (CTR) on your website to the cost per transaction, analytics are a great thing.

But even though we have the tools at our disposal and quite often even a dashboard with a summary of multiple facts of our business, we fail to really learn what they all mean. Sometimes it is hard to see the forest for the trees.

All this data is wasted.

As a franchise owner, you probably have invested both time and money into analytics and/or a dashboard solution to help your franchisees. You did this because you understand the positive impact they can have on any organization.

Done right, they can ultimately have a positive impact the bottom line.

So why aren’t your franchisees utilizing them?

There are five main reasons that may be holding your franchisees back from using data to really enhance their performance.

1.    Too Much Data

Have you ever driven by someone’s front lawn at Christmas where there are a huge amount of decorations and lights? While individually they look good, everything together is way too overwhelming.

That’s how many franchisees see their dashboards – information overload.

They don’t know where to focus. Experiencing “data overwhelm”, they choose to skip over it rather than try to make sense of it.

Take email for example. Workers spend 50% of their time just finding and reading emails. And with today’s inboxes getting overloaded with work emails and a large variety of ‘junk’ they get disorganized very quickly. In fact, 26% of all people want to delete their inbox and just start from scratch.

Just as we need to pare down the information that is received into our inbox, you need to reduce the amount of information shown on your franchisee’s dashboard.

For analytics to really be impactful, you need to narrow the data down to a few key pieces.

Choose information that they can act upon today. Think back to SMART goals:

  • Specific: it should be clear what you’re reviewing.
  • Measurable: if you can measure it, you can improve it.
  • Actionable: the scorecard should guide action; if you can’t impact it, don’t include it.
  • Relevant: if it’s not related to your objectives, it’s not important.
  • Time-specific: they should vary over time.

Narrowing the selection of analytics included on your Franchisee’s dashboard those that meet SMART requirements, can go a long way towards helping your Franchisees utilize them more frequently. They will see value in the data, not just numbers.

2.    It isn’t Actionable

How would you feel if your fitness coach said only tracked the number of pull-ups you could do?

It’s like telling your franchisee they had X number of customers last quarter. What is he supposed to take away from that? It’s not actionable.

Just as a coach needs to give his trainee advice that they can use to improve their performance, you need to do the same for your franchisees. Give them something they can focus on for the next period, otherwise the franchisees can experience “paralysis by analysis”.

One example of an actionable insight is the metric ‘discount percentage’. When benchmarked against other franchises, if yours is higher, you can take steps to decrease it.

Give your franchisees actionable data and show top weaknesses first, the first thing they need to address before moving onto something else.

Keep in mind that not all franchises are alike. If you are doing a comparison you, need to do so with an equivalent group. If some of your franchises are located in a food court and others are restaurant style, they shouldn’t be compared against each other. Try to keep comparisons fair, apples-to-apples. If it isn’t a fair comparison it will be ignored, and they may start to distrust the system.

3.    It Doesn’t Inspire Change

Everyone has a growing list of things to do, and as a business owner yours is possibly longer than most.

Because of this it’s easy to let your franchisees swim alone once they’ve had their training and are up and running. You assume that they’ll know how to use the information they get via analytics.

But they also have that ever-growing list.

And that information they want them to sift through? It just becomes another “job” on that list. Rather than helping them enhance their operations, it gets pushed aside for more pressing tasks because they don’t realize, or can’t interpret, the value it holds.

A bunch of facts and figures isn’t very inspiring to many.

To make it inspire change – keep the lines of communication open with the franchisees, and “shine the spotlight” on best practices.

  • 70% of workers said that they would work harder if their efforts were appreciated.
  • Engaged companies out-performed unengaged companies by 167%

The bottom line? Engage with your franchisees in more ways than just sharing numbers, show your appreciation of them with the entire Franchise. For example, instead of just displaying the franchises with the top sales numbers, remembering apples-to-apples, give the smaller franchises a chance to shine by also featuring the best young franchises, food court franchises etc.

4.    It’s not Timely

How many times have you heard “hindsight is 20/20”?

As a business owner you know how important it is to have up-to-date information as soon as it becomes available. You would get it yesterday if you could.

As a franchisee, getting information when it is too late is very discouraging. If their dashboard is full of old data, it does nothing for them. Even if it is ‘actionable’ if it’s outdated it won’t help them improve their business and therefore their bottom line.

This can make them feel powerless. And there is no point in communicating something when they are powerless to make change.

For a business to flourish you need the lines of communication open.

Data should be flowing both ways regularly to keep the motivation going. Give them the tools and information to make better informed decisions and the ability to see where they are at in relation to their peers.

5. They don’t Understand It

Remember Shakespeare in High School? Back then, you had time to do a deep dive into the meaning, and maybe not even then. You don’t want your Scorecard to be Shakespeare, you want it to be simple and straightforward – think of the headlines of the daily news, or even Twitter.

Complicated metrics, with multiple meanings, can cause this same confusion. Leading to debates and arguments rather than solving a problem, they have the opposite effect of what you want.

“Fuzzy” or vague interpretations can have just as negative effect. People will not take the information seriously. For example, if you have a “stated sales number” but rarely collect, the better metric can be revenue, or money in the bank.

In short, when pulling together data, remember that many Franchisees do not love numbers. Think KISS: keep it simple, stupid.

In a nutshell…

Franchising is all about relationships – and that extends to reporting. If you really want your franchisees to grow, clear and helpful analytics is a great place to start.

Proper reporting, when done right, enhances transparency and increases engagement.

But you can’t just share any numbers that sounds good. You need to deliver actionable data that your franchisees can use to improve their business. Also, keeping it true by only comparing apples to apples can help strengthen their trust. If they stop trusting it, you are not in a good place.

With Franchise Scorecards, franchisees can customize their dashboards to the information that is most relevant to them, and you can better share data that is relevant to all. Helping you all to grow together.

Keep is simple. Keep it SMART.



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Gino Wickman’s Traction and Scorecards

By | Franchisee Scorecard

Gino Wickman’s book, Traction, has taken the franchise world by storm. It was in a session at the International Franchise Association convention in Phoenix in 2018, and it has been the subject of countless articles by thought leaders. For example, according to Eric Stites, CEO of the Franchise Business Review as published on the Franchise.org website:

Wickman’s simple yet genius tool, Vision/Traction Organizer, will bring clarity to the key priorities of any business. Having a clear vision and a detailed plan will dramatically improve your franchisees’ success. PostNet International Franchise Corp., BrightStar Franchising LLC, Moran Family of Brands and ZOUP! Fresh Soup Co. are just a few brands using “Traction” (and companion book “Get A Grip: How to Get Everything You Want from Your Entrepreneurial Business”) to push their businesses forward.

If you aren’t using Traction right now in your business, you may want to consider it. According to Shelly Sun, the Chairman of the International Franchise Association Executive Committee and the President of Brightstar Care as quoted in MSA Worldwide‘s profile:

For us, this means putting the right processes and people in place to enable their businesses to run smoothly without their 100% involvement. Gino Wickman’s book Traction outlines the Entrepreneurial Operating System (EOS) and the steps to help business owners get clear focus on the right people and processes that are essential to the growth and profitability of their business.

Brightstar has invited Wickman to a number of conferences and use the methodology extensively. So – the next time you are at a franchise event, look to the right then look to the left. One of them has likely read or implemented the book in their organization.

What is Traction?

EOS is a set of tools which helps businesses succeed. According to the EOS website:

EOS®, the Entrepreneurial Operating System, is a complete set of simple concepts and practical tools that has helped thousands of entrepreneurs get what they want from their businesses. Implementing EOS will help you and your leadership team get better at three things:

Vision—getting everyone in your organization 100% on the same page with where you’re going, and how you plan to get there
Traction®—instilling focus, discipline, and accountability throughout the company so that everyone executes on that vision—every day
Healthy—helping your leaders become a more cohesive, functional, healthy leadership team

Although many of these tools can be found in the curriculums of business schools, and franchisor teams may know of them, in reality, many franchisors do not have the structure of the focus to make this happen without a formal process, such as EOS.

EOS and Scorecards

At the heart of the EOS system is a series of numbers, determined by the team as most important, and tracked on a weekly basis at formalized meetings. These numbers are called a “Scorecard”. There are seven truths according to Wickman that make scorecards work:

  1. What gets measured gets done.
  2. Managing metrics saves time.
  3. A Scorecard gives you a pulse and the ability to predict.
  4. You must inspect what you expect.
  5. You can have accountability in a culture that is high trust and healthy.
  6. A Scorecard requires hard work, discipline, and consistency to manage, but it’s worth it.
  7. One person must own it.

Whether or not Traction is the model that you choose to follow, like so many others, do any of these “truths” resonate with you? Would having any of these truths present in your organization help?

The Automatic Scorecard

Released at the 2018 IFA conference, FranchiseBlast was pleased to offer up our custom Franchise Scorecard. Traction devotees, and “numbers people” alike were compelled by the scorecards as a way to simplify the reporting process. Contact us to learn more about how they work and how they can fit within Traction.



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3 Tips on Rolling Out an Effective Franchise Scorecard Program

By | Franchisee Scorecard

Franchise Scorecard ProgramOne of the biggest challenges to rolling out an effective franchise scorecard program is getting buy-in for KPIs. A lot of time both franchisors and franchisees can see the need for them but are concerned about making any significant changes outside of the original franchise agreement. Here are some tips based on what is happening in the franchise community right now.

1. Document Process of Developing KPIs

It is important to remember that franchisees are independent business people and need to understand the rationale behind the numbers. That is why the favourite question of your best franchisees is “why?”. If you carefully document how the KPIs will enhance the brand of the system and how it will benefit each individual location, you can have your bases covered in terms of KPIs. The KPIs were not pulled from thin air – they were based no the franchisor’s reasonable judgement on key success factors.

Now, more than ever, you probably hear your franchisees complaining about competition. So – talking about how the KPIs were developed to beat local competitors is a great way to get buy-in.  After all, you are proactively solving problems for your franchisees, which is a key value-add of being part of the system.

2. Seek Franchisee Buy-In Before Implementation

The best-case scenario is to get your Franchise Advisory Board (FAB) to co-create your KPIs with you. Interestingly, these successful franchisees can see the weaker ones as hurting the brand and their own investment. Getting your FAB to develop the KPIs with you and even connecting them with roll-out communications such as newsletters, webinars and social media can be a powerful tool for compliance.

If the FAB is not engaged in the initiative, having some of your larger franchisees adopt the KPIs ahead of time can also be a great boost for the initiative.

3. Use a “Carrot” rather than a “Stick” for Compliance

Encouraging positive behaviors, rather than punishing negative ones is a good rule of thumb in general, but it is more important than ever in franchising. Potential rewards include:

  1. Eligibility for expansion.
  2. More AdFund or PR support.
  3. Being in the “spotlight” on webinars, internal case studies and social media.

All of these are great rewards and creates a positive energy around your program. It also mitigates the risk of a dispute.

Ready to Get Started?

FranchiseBlast’s Scorecards were built especially for franchisors and we have a deep understanding of this environment. Reach out to us to learn more about how Scorecards can help your franchise business.

Thanks to the presentation from Higher Logic for some of the inspiration for these tips. Ron T. Coleman, Jr. Parker Hudson Rainer & Dobbs, LLP Elliot R. Ginsberg Garner & Ginsburg, P.A. Sarah A. Walters Perkins Coie, LLP.



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5 Signs that You Need a Franchise Scorecard

By | Franchisee Scorecard

Franchising is one of the most exciting communities in the world. There is no other place where there is so much entrepreneurship, creativity, and people who care about making a positive impact on their communities. But, that excitement can fall short when it comes to the every-day business of metrics and measurement.

When you have an organization full of people who are passionate about soft skills such as helping others grow, teaching, inspiring and creating positive change, it is tough to turn around and make them do something as mundane as staring at the numbers. But, seasoned veterans of the industry know how important it is to “know your numbers”, and getting to know them may be easier than you think.

1. Everyone Is Not on the Same Page

In a distributed organization like a franchise, people get in the habit about talking about the same things in different ways. It is tough to get training, marketing, field operations and even your multi-unit owners on the same page when all of them think differently. It is important to be “one franchise” rather than dozens or hundreds of small, local businesses. Having a single goal, reflected in a franchise scorecard, is a positive way to build consensus in the organization.

2. Franchisees and Team Members are Getting Disengaged

People like to have a sense of meaning in their workdays. If goals are misaligned, people can be told one thing by their manager, but hear something else from home office. This creates a “no win” situation for the person on the front lines, where they don’t know what winning or losing is. Having a scorecard, and everyone aligned with it helps people understand how they can best contribute.

3. Excel and Google Sheets Rule You (Rather than You Ruling Them)

In a lot of franchise organizations, there is a ton of intelligence that sits on the hard drives of individual computers. Have you ever had turnover, and had to frantically break into a computer to find a key tracking spreadsheet? How about phoning and texting former employees, trying to get access to that Google Sheet? Excel leads to silos and while these tools are getting more collaborative with Google Sheets the knowledge is often in many different places and difficult to reconcile. Having a scorecard means that the information is all in one place, and the right people have the right access.

4. Goal Planning Happens in Silos

A simple, clear, visual aid, when implemented correctly, can do the following:

  • Gives franchisees and team members clear goals to keep in mind while working on projects.
  • Helps franchisees and employees understand the strategic pieces that need work.
  • Enables franchisees and other stakeholders to see how objectives affect one another.

5. Complaints about Communication and Transparency

As the saying goes “the biggest error in communication is the assumption that it has taken place.” There is often a swinging pendulum in franchising when it comes to this important topic. When the franchisor communicates too little, there can be complaints of lack of transparency, even when the source of lack of communication is because the franchisor is too busy providing value for the franchisees! When there is too much communication, franchisees can become “numb” to it, and stop opening e-mails. Having a franchise scorecard helps you set goals once, and then people can review them in their own time at the rhythm that is right for them.

Ready to Create Positive Change with a Franchise Scorecard?

While change can be scary, it can also be invigorating to see how it can get everyone focused on the right things for your business. Having software for help you with your scorecards can be a great help. While we are clearly biased, we think that if you are in franchising, our franchise scorecard tool is the best – and hopefully the 13,000 locations that currently work with us will agree. Reach out to us to learn more.

Franchisee Scorecard by FranchiseBlast



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