The Role of AI in Franchise Operations

What exactly is the role of AI in franchise operations? For years, most operations professionals would say, “Um, none?” or perhaps detail how they use automation tools to make admin tasks happen faster.

But today? The role of AI in franchise operations has exploded. Transformed. 

Operations teams and professionals are flocking to AI, and finding incredible results by embracing everything from complex automation to Chatbots, predictive analytics, inventory management, and performance tracking.

How AI Is Transforming Franchise Businesses

There’s no doubt that AI is transforming the way we operate and grow our franchise systems. With large language models (LLMs) gaining massive popularity (ChatGPT became one of the top 10 most visited websites on the internet in January 2025), the ease and accessibility of using AI in business is at an all-time high.

Tools for automation, predictive analytics, demand forecasting, and more are all becoming increasingly popular and accessible, with demand growing constantly. With a 897B annual economic output, it only makes sense that the franchise industry is a part of that growth and demand for AI.

AI-driven automation and decision-making in franchise systems are speeding up operational efficiency and, when used correctly, creating more time for human connection and support for franchise owners.

Conferences, new supplier partners, training for teams, tool implementations… We’re seeing franchise brands embrace AI for all parts of their system, and especially for operations teams who see value in alleviating tedious tasks, working smarter, not harder, and scaling more efficiently.

Key Areas Where AI Enhances Franchise Operations

There are so many ways to use AI in franchise operations, but here are some of the key areas to look at implementing.

AI in Customer Service – Chatbots, virtual assistants, and AI-driven FAQs

Customer service is massively important for franchise brands to create a positive, uniform brand experience and generate loyal brand fans. AI can help alleviate the tedious or repetitive tasks involved in customer service promptly.

Chatbots are being trained on specific brand information, tone, and common challenges for faster replies to issues or questions on your website or app. AI-based Virtual Assistants (think Alexa or Google Assistant) are also trained on your company’s voice and processes to free up time for answering questions or connecting inquiries to the right departments. 

But it’s not just implemented tools that help with customer service; using an LLM like ChatGPT or Claude to analyze inquiries, questions, your website, and sales materials can help identify FAQs to fill any gaps in your processes or information.

Inventory & Supply Chain Management: Predictive analytics, demand forecasting

AI is hugely helpful for inventory management because when paired with predictive analytics, the result means you can better stock inventory, time out orders, and predict what will need sourcing next. 

Having AI-driven demand forecasting and supply chain analysis saves time, goes deeper into your system’s existing data, and keeps your operations running much smoother. You can spot patterns faster and spend more time on the tasks that benefit from the human touch, like support or coaching.

AI in Marketing – Automated ad campaigns, customer segmentation

Although early interest in AI for marketing was focused on content creation, the real gem in this part of your franchise system operations is using AI for automating, analyzing, and segmenting.

Existing platforms like LinkedIn are helping users to harness AI for ad campaigns. The LinkedIn Accelerate tool allows users to automate ad campaigns and target based on desired results and demographics for faster, lower-cost, more agile campaigns.

Brands are using LLMs to analyze target demographics and locations and provide segmentation options that would take valuable hours from a marketing or operations team. Tasks like these are how AI is supporting growth at speed.

AI in Employee Training & HR – AI-based learning platforms & performance tracking

An often overlooked aspect of AI is how it supports training and development for teams and companies. AI can document processes, create training modules, and track learning progress to allow for more personalized learning and save hours for a franchise operations team.

But not only can AI support the training and development process, but training your teams on how to safely and effectively use AI in their daily operations can dramatically improve performance.

Train In Your Lane has trained iconic brands like Shuckin’ Shack and Ben & Jerry’s on how to think and work with AI. Efficiencies have a major impact on your bottom line. One hour saved per day, per employee is $8750/year each. Scale that across your system, and the ROI gets wild. 

Use the FBR referral link for the incredible Train In Your Lane programs!

Creating Custom GPTs – Natural language queries and custom databases

OpenAI has rolled out custom GPTs, creating opportunities to have a GPT model customized for a specific company or purpose by adjusting the AI chatbot’s knowledge base, voice, personality, interactions, or behavior.

Custom GPTs are used every day for everything from grammar checks to image generators. As a franchise company, custom GPTs offer useful cases that are specific to your business processes, culture, and data. 

Your team could ask short-handed verbal questions specific to your brand, your custom GPT chatbot could draw specifically from a custom database, and you could automate brand-specific tasks. Worth looking into as you implement AI solutions.

The Benefits of AI Adoption for Franchises

As a franchise, there are so many benefits of adopting AI and implementing it across your operations! Here are some of the top reasons for getting AI training and implementation in your system.

Cost Reduction & Efficiency – AI-powered automation saves time and resources

The most obvious benefit is efficiency. AI-powered automation makes tedious, repetitive tasks happen faster and can free up your team to focus on more important activities. This applies to automating communication, like with Chatbots on your website, all the way to processing and organizing data and predictive analytics.

Improved Customer Satisfaction – Personalization and real-time support

Having personalized support that exists 24/7 on your website, in nurture funnels, and through franchisee operations hotlines can create a much faster, more accessible user experience for customers and franchise owners. 

Enhanced Decision-Making – AI-driven insights and analytics

Seeing how AI-driven analytics reports or predictive data organized on streamlined dashboards can dramatically improve your franchise operations. By making decisions based on more in-depth, clearly analyzed data, you’ll make smarter decisions for growth and profitability.

Challenges & Considerations in Implementing AI

As with anything related to technology or business in general, there are of course, challenges and cautions to consider when implementing AI-driven solutions.

Initial Costs and Integration – ROI of AI investments

Due to the high demand from consumers and flooding of the AI market with companies hoping to ride the wave of interest, there are a lot of options for what AI tools to implement in your franchise. Most of these options are a big investment, especially when implementing across an entire franchise system.

Really understanding how an AI-driven solution works, how it will directly impact your operations, and what ROI you can expect/want to see from it is key to planning an effective implementation. To start, many franchise companies are having their teams attend industry-specific AI trainings to use it more effectively in their roles.

Data Privacy & Compliance – Navigating franchise regulations

Something to consider is your data privacy and compliance with your franchise agreement. Be sure to note your ‘system change’ or similar provisions in your agreement to ensure you can implement AI-driven solutions in your system.

Because AI solutions are trained on your company’s data, it’s important to understand what tools you are using and how your information may be shared or used for other purposes. 

Balancing AI with Human Interaction – The need for personal touch

A very real concern is that AI-driven solutions will take away the human touch and interaction that is so valued in the franchise industry and business space. Instead of replacing human interaction, AI should be used to make mundane or time-consuming tasks faster and more streamlined.

By using AI for automation, support, analysis, planning, data collection, and more, we can create more space for creativity, decision-making, leadership, professional development, conversation, coaching, and other areas of franchising that are uniquely human. 

Future Trends in AI for Franchising

As we’ve outlined in this article, there are some incredible uses for AI solutions in the franchise industry that improve efficiencies and location performance. 

• Automating royalty collection
• AI-driven onboarding and training programs
• Chatbots to streamline customer experience
• Custom GPTs that answer franchisee questions
• Predictive analytics and forecasting
• Data collection and strategic decision-making
• Automate tasks to free up time for human-driven activities
• Personalization to improve campaign performance

To stay up to date on AI in franchising, we recommend attending sessions at conferences that focus on AI solutions, attending online webinars and trainings that highlight uses for AI in the industry, and creating conversations with fellow franchise operations teams to share best practices.

Something we anticipate happening more and more is having franchisee candidates ask about how brands are using AI-driven solutions as part of their decision-making process for choosing a franchise to move forward with. 

We also predict that brands that embrace AI with intention, using it for efficiency, automation, and strategic analysis, will outpace brands that are still using human effort for the mundane repetitive tasks in franchise operations. 

Brands that ‘outsource’ these tasks to AI solutions, and focus their team on franchisee support, coaching, customer service, creativity, and human-driven connection, will be able to scale much more quickly while still embracing human connection and relationships where it counts.

Conclusion

The data speaks for itself: If you want to grow your franchise, embrace modern tools, increase efficiency, and create space for more human connection in the areas that really matter, AI-driven solutions are here and they are solving some really big problems. 

Armed with an understanding of the challenges, considerations, and the overall role of AI in franchise operations, your next step is to identify where it makes sense to implement solutions in your system and explore how your brand can grow!

Ready to implement AI-driven solutions for more efficient, smarter franchising? Register for the FBR Summit to learn from franchise operations leaders and experts in the industry.

The ONLY Event Designed Just for Franchise Operations Teams

How can you make an immediate and lasting impact on your franchisees’ success? Find out at the FBR Summit, October 22-24 in Austin, TX. The Summit is an intensive, franchise industry event created just for operations leaders and their teams that directly support franchisees. Don’t miss it!

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