How Can Franchisors Show Appreciation to Franchisees?

A question franchisors often ask is whether it is necessary to reward and recognise franchisees, given they’re intrinsically rewarded by running their own business and keeping the profits. Our answer is, from a psychological perspective, everyone needs to be recognised and appreciated, and not necessarily in a monetary capacity.

So the real question is how can franchisors show appreciation and recognition to franchisees in an appropriate way?

In this article, we'll share some best practice tips on how to recognise and appreciate your franchisees, based on good research.

7 commercial benefits of appreciation

As part of our research at FRI, we measure the importance of 24 areas on whether franchisees will recommend your franchise, commit to staying with the business, and engage with your initiatives. We call this the ACE Mindset, and we measure it using our ACE Franchisee Satisfaction Survey.

We recently analysed the importance of Appreciation to the ACE Mindset. Appreciation is the extent that franchisees feel respected and recognised for their achievements and contribution to the network. The answer is that Appreciation has a correlation of 0.71 with the ACE Mindset, demonstrating a highly significant relationship.

We also discovered the following seven data-driven insights about Appreciation:

It drives satisfaction: The more franchisees feel appreciated, the higher their general satisfaction.

It drops with tenure: The longer a franchisee's tenure, the less they feel appreciated.

It is impacted by consultation: The more franchisees feel listened to, the more they also feel appreciated and respected.

It influences perceptions of support: Appreciation generates more confidence in a franchisor's training and support systems, and perceptions of responsiveness.

It drives optimism: The more franchisees feel appreciated, the more optimistic they feel.

It creates a sense of belonging: Increased feelings of appreciation also increase a franchisee's sense of belonging and connection to the franchise community.

It improves confidence in franchisor leadership: We believe this is the most important point of all. The more a franchisor team demonstrates appreciation, the more franchisees believe in their integrity, competence, and vision for the future.

We think these findings are vital to the health of franchise networks at this time, given the angst and uncertainty people are feeling. Read on for some best practice tips, and training to equip your franchisor team to do better in this area.

Getting creative with recognition

There are hundreds of ways to appreciate and recognise your franchisees. Here are a few that we have seen make a big difference.

#1. Recognise regularly. Make appreciation part of your culture by publicly recognising franchisees that are doing good work and supporting your values. Include stories of their achievements in your social media posts and internal communications.

#2: Don't take longer tenure franchisees for granted. As mentioned in our research update above, there is a tendency to take these people for granted. Many groups have traditions of appreciating tenure by holding special functions for long-standing franchisees and publicly recognising tenure levels at annual conventions.

#3. Be creative with awards. While recognising sales is important, there are many other things that contribute to the success of a franchise network, including staff retention, franchisee referrals, excellence in local area marketing, and even being pleasant to deal with. Think about the behaviours you want your franchisees to practice, and formally recognise and reward these. 

#4. Remember it's not just about money. All humans have a deep need to be treated with status and respect. A phone call from the company President, an invitation to a prestigious function, the offer of additional services, being asked to join an advisory group - these are all powerful ways to show your respect and appreciation for a franchisee's commitment, loyalty or outstanding performance.

Develop Your Franchising Team With Us Today

Building a healthy relationship with your franchisees takes time and knowledge. Whilst we can't give you time, we can provide you with all the necessary skills, tools and knowledge you'll need to build a profitable, healthy franchising culture. For more information about our range of courses and publications, or if you have any questions about this article, contact us today. Our friendly and knowledgeable team would be happy to assist you.