It's not enough to have a profitable business model to get your franchisees to feel paying you your royalties is a fair deal for them. At first, the excitement of opening a business and the initial support can temporarily mask issues that may arrive in the future.
So what can you do to give the franchisees the value they expect and the value you more than likely provide the customers at your location?
Here is a good start:
- Be there: This means having the right people answering calls, emails, texts quickly, and having the solutions to their issue/s.
- Do what they could not do on their own: Finding volume discounts, paying for branding, and having exceptional technology and provide excellent value for a franchisee. A website and phone app that gets them new customers and builds loyalty are great places to start.
- Visit them: Not only should you need to visit your franchise location to evaluate their performance and compliance, but you should make time to do something social outside of the physical business location such as take them out to dinner. It would help if you also went over their goals with them each year and then re-visit them each subsequent year. Besides adding a level of support, it may even get goal-orientated owners to expand into a new location.
- Build community: Encourage your franchisees to talk to each other. This can be scary in many franchisees' minds because they assume they may gang up against the franchisor, which is a possibility. However, it is unlikely to happen in a system with a good culture and excellent communication. If you have a significant amount of franchisees thinking you are not on the same team, you have substantial problems already that need to be addressed. Once you are large enough, you should hold annual functions that should be an even mix of social activities and learning opportunities for your franchises. Once you hit over 20 units is when you can start thinking about that possibility.
- Listen: This is the hardest one to do, even though on the surface, it may sound simple. It is hard because a franchise system MUST have consistency. Yet, you will find your franchisees will all think you are not listening when they argue for a new product, service, or a different internal system that they believe is better. You need to learn diplomacy and have a set system for franchisees to present their opinions, especially when you are small to medium-sized. Once you grow, you should set up advisory committees that will provide a platform to get all the best ideas and filter them.
- Provide them with actionable data: Collect, benchmark, and share all the data you collect. This is where Fran Metrics can help! See our page here: https://franmetrics.net/financial-services for more on how we make it possible.
Of course, this is only a small list. The industry you are in may have many more opportunities for you to support your franchisees, which will set you apart and make them see the value in your system!