Jim Squire, CFE, is the director of franchise development for the HoneyBaked Ham Co. and Café he writes in Franchising World healthy relationships are the backbone of any successful franchise system. In franchising, the most important assets––franchisees––are out in the field, versus the corporate office, the distance can create challenges in maintaining positive relationships.
Franchisors, like anyone else, are probably growing weary of what is becoming the most common way to start a sentence these days, “In today’s uncertain economic times, it’s more important than ever to …”
Unfortunately, here it is, one more time, with the ending appropriate for the franchising audience: In a down economy, now more than ever, it’s imperative to maintain consistent, positive relationships with the people that are the lifeblood of your system––your franchisees.
In an atmosphere where many circumstances, such as the turbulent stock market and the sub-prime mortgage crisis, are out of a franchisor’s power, franchisee relations is the one thing the company can control that can directly affect franchisee satisfaction, system-wide profits and franchise sales.
Telling franchisors how important it is to maintain positive relationships with their franchisees is easy enough to do, but providing real, practical tactics for them to start building and improving positive relationships with their franchisees carries more value. Consulting with experienced franchisors of mature franchise systems to discover proven tools of the trade is a great place to start.
The majority of established franchise system executives agree that constant review of franchise relations tactics is imperative. The most successful, mature systems consistently evaluate what’s in place, decide what’s working and what’s not, and also introduce new techniques to perk up their systems as needed.
The Validation Factor
As a franchise system’s most powerful sales force, franchisees can be strong allies or not so strong allies. Positive franchisees demonstrate to prospects that the system is sturdy, and supportive. When franchisees’ ideas and questions are consistently heard, and actions are taken to implement their suggestions, overall franchisee satisfaction increases. Satisfied franchisees, in turn, are likely to provide positive feedback to prospects.
Communicate, communicate, and communicate. If location, location, and location are the age-old three most critical factors to the start of a business, communicate, communicate, and communicate are the three most critical factors to the success of a business.
So, how can franchisors better utilize existing approaches in terms of franchisee communication? Might a change be needed? Some traditional methods, such as using field consultants for store visits, are adequate, but how can these consultants be better utilized? Often, a field consultant is sent out to troubleshoot a problem, but is a rare sight in quiet times. They take use the “no news is good news” approach. However, a more proactive campaign can head off troublesome times to begin with.
Field consultants should consistently offer new ideas to franchise owners and assist them regularly with tactical means of boosting sales and driving business, not just make sure things run smoothly or help put out fires.
Tips From the Pros
Once a franchisor has objectively examined its franchise relations methods, it’s time to find out what’s working and what areas need to be addressed. Consider some of the following advice from some of the nation’s most successful franchise systems.
Jo Kirchner, CEO of Primrose Schools, with 200 locations nationwide, said the key to healthy franchisor/franchisee relationships begins with respect and clarity. It all starts with finding the right franchisees.
• Build Trusted Relationships
“All good partnerships start with a shared vision, core values and a clear understanding of each others roles,” Kirchner said. “At Primrose, we recruit people who share our vision and our values, such as our foundations of trust–integrity, fairness, social responsibility and enthusiasm. When you start to build trusted relationships with the right franchisees, you have a clear understanding of how they are going to work together. Only then can positive relationships flourish between both groups.”
• Listen Well and Over-Communicate
“Positive relationships require good listening skills. Each party should have a need to understand what the other is thinking, and why,” Kirchner said. “Most of the time, we are able to come to mutually-acceptable agreements when conflicts arise, but only if we both understand what’s important to each other, and why. Communication is a huge challenge in today’s fast-paced world. People need to know what’s happening, when it’s going to happen, and why. When they don’t, it leads to speculation, which breeds negativity and fear. In the end, relationships suffer.”
• Focus on Their Bottom Line
“Engage franchisees in initiatives that are important to their business. When franchisees feel that you are focused and highly-committed to the profitability of their business, the partnership is strengthened,” she said. “When they know that their opinions count, that their ideas are considered, and that their thoughts are embraced and incorporated in strategic decisions, their confidence in the partnership grows.”
Read more at Franchising World