It’s no surprise to anyone that online businesses, e-commerce websites and other digital sales-focused platforms are top performers on the financial side of things nowadays. Global business behemoths like Amazon are paving the way and renowned for being the most valuable companies on the planet.
This has resulted in business owners wanting to get their slice of the digital pie. The perfect way to do this is to check out the online franchises available to buy either by using a franchise business directory platform or by visiting franchise events. Investing in a franchise brand allows entrepreneurs to pay an initial fee to invest in their own online business model and receive marketing, training, operational support and much more in return.
There are some amazing digital-focused brands out there at the moment that have low upfront costs or financial requirements due to being home-based businesses, but are also offering profitable franchise opportunities for potential franchisees. And the main benefit of investing in an online franchise brand? If you have the financial qualification, you don’t need to build the business from scratch – the brand provides you with a business in a box, which is perfect for entrepreneurs wanting to create an online franchise store but have very little digital business experience.
Essential technologies and systems that can help franchise companies prosper in the digital age
CRM
A franchisor must be able to monitor how each unit in their network is performing, and also quickly identify when problems arise. Failure to do so will likely result in franchisees missing their sales targets, which could be disastrous for the franchise as a whole. To mitigate this, there must be an emphasis on ensuring regular communication and adherence to systems and procedures. Yet the more the network grows, the greater the administration and oversight that is needed to manage it. This can test the organization and efficiency of any business, which, more often than not, will have to evolve new ways of doing things, such as bringing in new technology or even AI tools.
The most effective solution to this is likely a technological one. It is no secret that tech has become a valuable asset to all manner of businesses. Across many industries ‘digital transformation’ has become a commonly heard phrase, which at its most basic level is used to describe the adoption of new technologies by franchise systems, in order to automate key areas like payroll or sales. Doing so is increasingly considered an essential business activity, helping to reduce operational costs, improve productivity, increase profits, and generate an overall better customer experience. It is no wonder then that worldwide IT spending is projected to total $3.8trn in 2021, an increase of four per cent from 2020, according to the latest forecast by global research and advisory firm Gartner.
Yet achieving genuine digital transformation is often beyond the means of most businesses, requiring huge investment, fundamental organizational change, and employee reskilling, with no guarantee that it will be successful. Costs can run into the thousands, if not millions, and even when achieved, savings not realized for many years.
The reality is that achieving digital transformation should be a long-term objective, but that does not mean franchises cannot immediately harness many of the very same technologies that are employed by the world’s most successful companies. Yet with so many digital tools emerging at an increasingly rapid pace, the challenge for franchisors is working out which ones they should be investing in now to ensure sales growth and organizational cohesion.
Customer Relationship Management (CRM) is a clear example of business-critical software and is often the first step towards going digital, being able to automate numerous mundane tasks in order to improve business efficiency. A franchisor can use it to store, update and analyze franchisee information, monitor contract renewal dates, build stronger relationships within their network, and manage sales data and enquiries.
For example, a CRM can weed out unsuitable licensee enquiries, while automatically collating potential leads, before storing the data safely in an easily accessible format. Immediately afterward it can be passed over to a franchisor’s sales team to process. Time-consuming administrative tasks are mitigated, allowing sales teams to focus on what they do best. It also helps build deeper and more effective relationships within franchise networks because interactions with them can be easily accessed in order to understand their financial value and forecast their future needs.
Analyzing data to create meaningful business insights is a primary function of CRM software, whether that be the individual performance of internal departments, franchises or leads. Furthermore, a CRM will be able to create appropriately tailored communication materials using the very same information to proactively and appropriately engage with them. This could be anything from sending out celebratory messages when business is going well, or simple reminders to ensure pertinent activities are actioned.
It also should be noted that a good CRM stores your database securely in the cloud giving access only to who you want, when you want. Individual records can be locked down to specific team members, sales teams, or regions, or locked so they cannot be accessed or exported. All actions are recorded within the CRM so you can see when items have been amended and by who. The chances of losing data or it being inputted incorrectly are entirely minimized.
Therefore through proper oversight and organization, a CRM helps ensure shared standards and values, high performance, mutual trust, and effective communication, which are so critical for the success of franchise organizations.
Customer support
Professionals in the franchise business need no introduction to branding. The brand is what differentiates a franchisee from an independent standalone small business. When prospective franchisees sign up with a franchisor, they are hoping to jump-start their business by paying their initial investment, they are leveraging the franchisor’s infrastructure, economies of scale, training, and branding.
A brand is a result of the reputation of the franchisor. Reputation is a result of how products and services of the franchisor are perceived in the markets they operate in. Once franchisors set their standards for the product, service and process, they typically translate this to consistency in their marketing effort. Next, for their branding effort, they include messaging, logos, color schemes, a mobile app, fonts to be used in various displays, etc. The franchisor projects all these aspects as branding in the target market. Proper branding reflects the business vision for the franchise. But there’s more to the brand than just how the franchisor defines it: there’s customer perception.
Branding begins with quality in product and service. There was a time when quality was described just as, “I know it when I see it.” Over the years, however, quality metrics and Key Performance Indicators (KPIs) were developed. Quality related to the product may be measured with KPIs in the specific domain. Quality related to the overall processes within the company is generally defined based on standards such as those from ISO. A classic definition of “quality” from a classic company (General Radio) sums it up as, “Quality products are those which meet customers’ expectations. Quality products do what customers want them to do, at a price they’re willing to pay.” Cost, schedule, and quality must, therefore, strike a delicate balance.
What happens when the franchise starts interacting with the customers in the digital space beyond their physical locations? The franchise must maintain standards for dealing with customers and establish processes for resolving problems that may arise when their products and services are used; this needs to be in the business plan or franchise agreement from the start.
In the context of the franchise model, the franchisor is a level away from direct customer interactions typically ‘shielded’ by the franchisees. Unless the franchisor has company-owned stores, the franchisor must rely on customer feedback from home-based franchises. This level of indirection can be frustrating for the franchisor.
Customers expect their experience to be seamless – they won’t be getting out the American Express card if they have had a bad track record with the brand before. Only when there is a problem, the customers notice how efficiently and effectively it is handled. If the customer feels that the problem is not handled as per expectations, there are chances of not only losing the customer but also getting negative publicity in the market or on social media. This is especially serious if the problem is inherent in the offering. This can be detrimental for the franchise brand. So, the franchise must have a streamlined plan for customer support management that is cascaded across its network of franchisees.
There are many aspects of customer support: direct human interaction, phone interaction, email, mail, trouble ticket (case) management. The best way to interact with the customer is to have direct human interaction. However, it is not always possible nor is it scalable. To track customer problems, franchisors can deploy SaaS technology to streamline customer support in addition to direct interactions. An online Customer Support Management System can be used to register, track and resolve problems. Such a system consists of creating cases (also known as trouble tickets) and tracking the cases until the problem is resolved. A customer, a franchisee employee or franchisor employee can create a case with a priority and severity defined. Each case is then assigned an “owner” (franchisor or franchisee employee) who is responsible for problem resolution through collaboration with the appropriate persons in the franchise.
Priority and severity for the case get translated directly into a service level agreement (SLA) for that case based on pre-determined standards for the franchise. For example, if the case is of a high priority, the time for resolving the case is the shortest. The actual time can be configured by the franchisor. Some customer support systems let customers log-in and add notes for inputs to their case besides viewing the status. Giving customers access to their case can reduce the cost for phone support and can provide transparency for customers about the case. The franchise can also maintain privacy if the customer support system allows the employees to add notes for internal use only.
Customer support systems give the franchisor direct visibility into ongoing field problems. Franchisors can view the KPI dashboard of a customer support system to determine how many new cases were opened and how many cases were closed during a certain period. They can also track the amount of time taken for problem resolution.
This information allows the franchisor to mitigate future problems encountered. A good customer support system builds up a history of solutions that can morph into a powerful knowledge base for future use. Since consistency is the most essential ingredient of branding, having a knowledge base of solutions can result in enhanced quality of products and services in the long term.
Customer support system is preventive care for avoiding deterioration of a brand that is built over time. Online Reputation Management (ORM) after a problem gets escalated in the market or media is remedial. It is important for a company to also have an ORM and a strong presence on social media to counter negative or false reviews. However, focusing on customer support can reduce the cost for ORM and can minimize lost revenue.
Branding is aligning customers’ perception with what you want them to perceive your company as. Brand promise, perception, expectation cannot be managed without a customer support system in place. Actionable service data based on KPIs can result in improved customer retention as well as improved organizational efficiency. Positive customer support interaction can even generate revenue increase through up-sell opportunities during the interaction itself. For franchisors, the brand eases selling a business proposal to potential franchise professionals convincing them that it unlocks profitability.
Brand management requires a multi-pronged approach: brand vision, positioning, executing the marketing plan, advertising, ORM, social media management, and most importantly, a robust customer support system.
Five key benefits to outsourcing your IT department
1. Reduce and control costs
One of the biggest problems for people setting up a franchise is getting the money together to cover your start-up costs. For many franchises, an in-house IT specialist with the required level of knowledge is way out of budget – IT managers earned an average salary of $149,730. And what do you do when that one resource is on holiday or sick? Add in the costs of training, pension, benefits and other employer costs, the true price quickly ramps up. This is money that could otherwise be spent on business-critical activities.
2. Focus on the day job
Some franchise owners are forced by necessity to assume the role of de facto IT support because there’s no one around to handle it. Outsourcing IT can allow you to focus on running your business and free up staff to concentrate on their key duties.
3. Support your franchises
With the right business relationship, you can use your outsourced IT partner as your preferred partner to your franchise owners. This gives you and them a central point to which to address any IT issues.
4. Access to specialist expertise and the latest technologies
One of the biggest benefits of outsourcing is that you get access to a much bigger team of experts. Working with an appropriately sized outsourcing partner gives you access to a much wider technical team when you need it.
5. An on-demand IT department
Working with a company gives you access to much more than just technical support. You will have access to teams specialising in procurement, project management, installation, ongoing maintenance, and senior level IT management.
