As with any business, a franchise network needs to focus on driving performance.
A franchise operates to a defined business model, with all franchisees benefiting from being part of the network, not operating as individual businesses. Buying in bulk and using common operational systems has cost and efficiency savings for all involved.
However, as any franchisor knows, despite the business similarities, every franchisee is different. Each has individual requirements and needs, necessitating a particular level of support from their franchisor, to maximise their performance.
Franchisees are looking for a franchisor to provide them with relevant and timely support to help them grow their business and make more money. The franchisee, the franchisor and the network as a whole all benefit from maximising the performance of a franchisee’s business, so it is vital this is at the forefront of a franchisor’s mind. However, it can be incredibly difficult and time-consuming to look at each franchisee in isolation to work out exactly what they need. So what’s the best approach to doing this?
First and foremost, a franchisor needs to understand what support is needed where and when. To find this out, you need to measure and track activity within your network. Having all franchisees on a common accounting and bookkeeping system makes this a great deal easier. It will not only be likely to save franchisees money, but also provide them with a higher level of service and support. Having a single network accountant naturally results in an improved level of advice and support to each individual franchisee. Financial quirks of the business model can all be handled centrally and compliance can be more easily ensured for the whole network, giving both franchisee and franchisor peace of mind.
Drive performance
To do this, performance tracking and dashboards are extremely useful. Analysis of the network will reveal trends, gaps and strengths; really knowing a business comes from a single network view, not relying on gut feel or rumour. A dashboard allows the franchisor to understand what support is needed where and when in their network, ensuring the best use of the resources available to drive performance. This aids you in ensuring that the right guidance and support can be provided at the right time to the right people, in order to maximise performance.
Another benefit is handling tax savings ideas as a network. A franchise can save huge amounts in tax by standardising approaches. I know of a franchise who saved over £1M using just a simple network-wide reported business structure change. If each of the franchisees had been with their own non-franchise accountant, this wouldn’t have happened and the savings each year would have been lost, not to mention all the other benefits.
The result of simplifying this part of your franchise model is happier, better performing franchisees who are making more money. It encourages a whole new culture of targeted support, increasing performance and efficiency across your entire network.
ABOUT THE AUTHOR
Carl Reader is author of The Start Up Coach, co-owner of market-leading franchise accountants dennisandturnbull.com and co-founder of yourbeargroup.com. To hear more from Carl follow him on Twitter @carlreader or join ‘The Startup Coach’ group on Facebook
www.carlreader.com
