A smarter, better connected and more sustainable supply chain will not only strengthen your organization but will bring you a stronger caliber of franchisee prospects as a result.
Uncertainty – it’s the last thing any business needs and it’s been one of the biggest challenges of the past year. But it’s a recurring hurdle to overcome in good times, too.
We know that you simply can’t afford to stand still in business: markets, politics and consumer demand are in constant flux. In the midst of a global pandemic, it’s critical to move even faster and be more decisive.
COVID-19 presented challenges that most businesses were unprepared for. Amidst the chaos, in many cases, it was the “digital and delivery natives” who thrived and adapted to find new ways to delight customers and keep business on track. At Sushi Shop, we are fortunate to count ourselves among those that were well-positioned to quickly make sure that new trends were reflected in our supply chain and this helped us to successfully meet the demand of delivering at scale to customers at home.
Challenging times such as this also present new opportunities and are an excellent time to invest. The economic effects of COVID-19 mean that there will be consolidation in many different markets. This is something you can take advantage of.
For example, rental costs for commercial properties have gone down for the first time in many years. If you need a physical presence for your business then you now have the opportunity to get a good price in much better locations than has been possible for a long time. This could prove immensely beneficial for the types of customers and talent you need to attract – and also complement supply chain management.
Last year saw shortages and tension increase across a wide range of sectors and countless supply chains. This is a moment when franchisees long to be working with an established brand that reduces all the supply chain headaches and allows them to focus on their operations.
Franchisees benefit from using franchisor’s intellectual property rights: their trademarks, manuals and systems. And franchisors should always provide technical assistance. But, crucially, franchisees need to bring hunger to the table and put in hard work every day with their own team. In 2021, we all need to go the extra miles to be successful.
At Sushi Shop, we have all the systems in place and when we partner up with a potential franchisee we know exactly what it takes to be successful. We have a wealth of experience working with franchisees in different countries, so we are able to provide strong support for our partners, wherever they are. Sushi Shop is backed by AmRest, which has almost 500 franchised outlets across the globe and is the master franchisee of some world’s most beloved restaurant brands.
“The economic effects of COVID-19 mean that there will be consolidation in many different markets”
Our growth internationally has given us the knowledge we need to support the success of franchisees. In this business, human relationships and relentless motivation are critical ingredients. That’s what it takes to keep your supply chain running smoothly. The ideal situation for a franchisee is to have an established partner that already has everything in place. Otherwise, you have to take a pioneering approach to innovate and negotiate to perfect your own supply chain model. Today, that means obsessing over data and processes, embracing digital tools, driving a hard bargain with partners, and minimizing unnecessary costs and wastage.
Interrogate your data
Your own business data is an extremely valuable resource when managing your supply chain. You have to review it every day and plan accordingly. Of course, in today’s world, what was true last week might not be true tomorrow so it’s more important than ever before to consider external factors and how they could impact your operations. Look at changes in customer patterns and quickly decide if they could be an accelerator for progress within your franchise network.
Never stop interrogating your own data and other sources of intelligence available to you. Make sure you’re using the latest digital tools – technological disruption and the events of the past year mean that you can never take your eye off the ball. You need to take advantage of the best solutions at an affordable price.
Radio-Frequency Identification (RFID) is one significant change to the way inventory is managed across the world. Serialized tags or chips are embedded or attached to inventory, databases are integrated between inventory locations and retail locations, and managers have real-time data across the full range of inventory metrics. RFID technology provides a new set of data on how fast inventory moves through each step of the chain, specific inventory that isn’t in demand, and how many employees interacted with that item along the way. Keep thinking about how this, or similar technology, could benefit your business.
Nurture strong partnerships
Franchisees don’t sign up and make money automatically. They need to understand and manage the environment they are going into. They need to have the right products – and the best partners in the business. For Sushi Shop, this relies on knowing the right balance when outsourcing the delivery business, to delivery partners such as Deliveroo and Uber Eats, and negotiating the best contracts.
Franchisors should be able to supply franchisees with information about how they might gain access to new procurement services that allow them to purchase supplies at reduced prices via bespoke deals. As innovation and competition continue to increase, these opportunities are becoming more commonplace. They can create greater efficiency within the supply chain, deliver double-digit savings and help franchisees improve the quality of their product. Solutions of this kind can boost the whole procurement process, making it easier and cheaper to get the supplies they need.
Perfect the product line
Let’s get to the heart of your business – your product. Today, when competition is so fierce, you need to be constantly thinking about quality. Is your supply chain helping you or hindering you when it comes to providing the best product to your customer? It needs to be aiding your ability to innovate, test and launch new categories of products if you’re going to grow successfully.
Franchisees must work closely with suppliers, whilst carefully monitoring distribution centers and all parts of the supply chain. They need to enlist the help of laboratories, research centers, transportation companies, and certification organizations. It’s vital that franchise partners have evidence that they are regularly supervised by the relevant authorities and reputable bodies to ensure safety.
Reduce waste
Your franchise network also needs to consider waste in the supply chain: what is it costing your business and the planet? One of the most complicated things to do in the past has been to source more sustainable products. But there is now more information and more options available. This is increasingly important for both businesses and consumers. Not only is it the right thing to do but it can also have financial benefits for the business. Can franchisees get what they need locally? It might take a bit more research but can result in reaping the rewards.
What about cutting down on plastic and other packaging? This is a priority across supply chains today. For example, businesses need to make sure that packaging is compliant with the relevant laws on plastic-free usage. Soon, it’s likely business owners will have to go further still – to perhaps introducing reusable packaging – with the aim of eliminating plastic waste.
There are countless clever ways to contribute to the circular economy. For example, Sushi Shop in France has partnered with an amazing young company in Lyon that picks up our fish skins for free and transforms them into fish leather. They create shoes and wallets from waste. Supply chain management must be at the front of your franchisees’ minds on a daily basis. In more ways than one, you get out what you put in. At times of uncertainty, it’s even more important to scrutinize your supply chain. Because you can be sure that a smarter, better connected and more sustainable supply chain will be an integral part of your success as a business long into the future.
FIVE WAYS FRANCHISORS CAN ATTRACT FRANCHISEES
1. Provide the data and digital tools they need
2. Establish supply chain partnerships you can depend on
3. Be clear about what it takes to be successful
4. Innovate and take advantage of the latest trends
5. Reduce waste and embrace more sustainable approaches
THE AUTHOR
Thomas Kremer is president of franchise excellence and expansion at AmRest.
