BDC Operations Performance eXchange: Navigating Franchisee Engagement and Performance with Industry Leaders

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BDC Operations Performance eXchange: Navigating Franchisee Engagement and Performance with Industry Leaders

At the most recent BDC Performance Operations Performance eXchange, leaders from franchise systems across Australia had an opportunity to sit down and discuss challenges in their current franchise systems. In our most recent meeting, there was a clear focus on two current areas of challenge, franchisee engagement and performance.

The first was Franchisee Engagement, where attendees stated that:

  • It is difficult to balance the company’s priorities or strategic objectives with the day-to-day,
    often short-sighted needs of the franchisee.
  • As a relationship specialist managing Franchisee expectations, we need to be their ‘counsellor’
    and also ensure they have the drive and motivation to succeed.
  • Franchisees experience inconsistency from the field team concerning field visits and field
    manager skill sets, which erodes franchisee engagement.

Interestingly many franchisors have a less tangible or detailed approach to engaging franchisees in
the ‘recruitment stage’, compared to when they have joined the network. As a result, many of the
insights to enhance Franchisee Engagement pointed to a need for more detailed processes and
systems during the ‘recruitment stage’, which would then have a positive impact on engagement once
a franchisee joined the network.

For example, to have a narrow focus with a clearly articulated agenda and desired outcomes ahead
of time. This would be relevant to a successful outcome for a recruitment interview, field visit or
Business Review Meeting. Additional insights to enhance Franchisee Engagement include:

  • Ensuring potential franchisees have experienced the business from the inside out (onsite visit,
    meet other franchisees).
  • Conduct the ‘pre-franchise’ meetings similarly to the ‘Business Review Meeting’ to
    develop consistent and sustainable behaviours.
  • Prior to a final agreement, conduct an engagement day where the prospect meets all key
    support people in the business, and undergo a mini business planning session.
  • Clearly explain the role of a ‘field manager’, the purpose of a field visit and the structure behind a
    ‘Business Review Meeting’.
  • Conduct ‘Business Review Meetings’ in a ‘neutral’ environment where possible, with an
    articulated agenda and desired outcomes ahead of time. Follow-up with a small number of
    specific goals to be achieved.

It was also clear sustainable franchise performance is directly related to the overall franchisee
relationship. One of the greatest challenges outlined by the operations leaders is that franchisees are
often unaware of cash flow or profit issues or are disinterested in considering them.

Therefore, the insights outlined above to enhance franchisee engagement, will also have a direct and
positive impact on the overall Financial Literacy for franchisees. A few of the specific insights
identified include:

  • Implement a structured and informative process for a ‘Business Review Meeting’ which
    includes pre-meeting requirements, a detailed agenda and clearly actionable outcomes post
    meeting.
  • Implement a consistent system for finances, educate the franchisees’ accountant, and ensure both
    the franchisee and their management are aware of all cash flow and profitability measures.
  • Access to appropriate financial benchmarks is essential for managing franchisee performance, including feedback from customers (‘customer complaints’ is a reliable lead indicator for poor financial performance).

In a separate discussion we also identified remote or state based field managers can become
isolated or mis-aligned with the franchisors culture, which impacts their ability to build a positive and
productive relationship with franchisees.

If you would like to attend our next Operations Performance eXchange, enquire here. Learn more about BDC Performance here.

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