As businesses continue to experience uncertainty and upheaval to a greater or lesser extent, depending on industry types and local conditions, franchisors are working hard to help their franchisees adapt and stay relevant. FRI has been coaching franchisor teams on the importance of this for years, through our Franchisee Business Journey.
This model predicts that every franchisee's business moves through six stages. The journey starts with the optimistic Investigation and Initiation stages. The reality of hard work, negative cash flow and stress then kicks in, with the franchisee sweating it out through the Perspiration stage. Things come together as the business reaches break-even and enters the Consolidation stage. But over time, a franchisee may start to get tired, bored or distracted, as their business moves into the Maturation stage. Here they are at risk of burnout or rust out, and the business may plateau and decline unless there is a transition into the final Reformation stage. This is a time of reflection, reinvention and renewal.
We are mentioning this model as it always stimulates vibrant discussion in our professional development workshops, particularly in these turbulent times. In this Positive Franchising Update, we share some best practice insights on how to support franchisees through the important Reformation stage.
We were delighted to bring our mission of fostering the creation of profitable partnerships in the global franchising sector to life by contributing virtually to a conference in Brazil with the financial services franchise network, help! Members of the franchisor Support Office participated in a Culture of Franchising Workshop, while help! franchisees enjoyed a dynamic Profitable Partnerships presentation.
Kat started with FRI seven years ago as EA to our Founder. She has proven that if you thrive through that, you can achieve anything! Chances are you've met Kat at an FRI program, or in her role as manager of our franchisee recruitment tool, the Nathan Profiler. These days she is responsible for managing our business systems. When she's not busy keeping our team organised, Kat can be found on the volleyball court smashing the competition.
Every franchisee's business moves through a business development process involving six distinct stages, culminating in Reformation. This is where the franchisee reinvents their business and themselves. Here are nine tips to help franchisees through the Reformation stage so they will stay fresh and growing.
#1. Create opportunities for them to take on mentorship or advisory roles. This can give them a renewed sense of purpose.
#2. Offer advanced professional development opportunities. These might include invitation-only sessions with guest thought leaders or participation in learning tours of other businesses to stimulate fresh ideas.
#3. Explore opportunities for them to expand their local market share through additional units or distribution channels.
#4. If they are investing significant funds in development, ensure they have completed a thorough risk, and return on investment analysis.
#5. Take them through a diagnostic of their business, including a review of their strengths and development areas as a leader.
#6. Encourage them to consider bringing in a business partner who can add new skills and additional resources for expansion and development.
#7. Explore ways that they can refresh or refurbish their business and their internal systems.
#8. Encourage them to review their team to identify high potentials who could be promoted to management roles or offered a partnership in additional units.
#9. Explore the possibility of them taking a sabbatical from the business to refresh, spend time on their bucket list, and return with fresh goals and aspirations!
The Reformation stage provides an opportunity for franchisors to facilitate deeper franchisee engagement. This is because we have discovered through our ongoing research that, as franchisees pass the 12-year tenure mark, their General Satisfaction and sense of Achievement strengthens.
Many franchisors assist their franchisees to successfully navigate the Reformation stage by offering them additional units. This enables them to keep growing and take a more hands-off role. The percentage of multi-unit owners grows from 12% for first-year franchisees to 51% by the 12-year mark. Franchisees with multiple units are also more likely to be Advocates for the franchise, Committed to reinvest, and have higher levels of Engagement - what we call an ACE Mindset.
Our ACE Franchisee Satisfaction Survey is an effective and convenient way for franchisors to gain useful insights into how to better support their franchisees and strengthen the ACE Mindset. To discuss how many leading franchise networks take advantage of this service, contact us today.
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