The 3 Things Keeping Franchise Operations Leaders Up at Night

How Franchise Operations Executives Are Tackling the Challenges of 2021 and Supporting Franchisees 

By Courtney Stillings, Senior Client Consultant, Franchise Business Review, and Michelle Rowan, President & COO, Franchise Business Review

With no live franchise events this past year, virtual peer groups and roundtables have been a lifeline for franchise executives to collaborate and share both the challenges they’re facing and solutions that are working. Twice a month, FBR invites franchise leaders to our own roundtables to help folks continue networking, and there has been some truly valuable discussion. 

Last month we shared the biggest franchise development challenges, and since not everyone has the opportunity to join, we wanted to follow up with the common themes that are keeping operations folks up at night as we roll into the second half of 2021.

Biggest Operations Challenges for 2021

1. The labor shortage is more than just unfilled hires. At this point, everyone agrees that not being able to hire is the number one challenge for most business owners. Franchisees are burned out and need a day off. Some are requesting to close early or asking for modifications to days they are required to be open. Here’s how they’re tackling those issues: 

• The impact goes far beyond headcount, so how can franchise operations teams help franchisees as they struggle? It’s important for corporate teams to recognize how hard franchisees are working coming out of the pandemic. Whether they were closed and are now reopening, or stayed busy through this last year, the way they do business changed. Can you waive some of the requirements to be open to allow them to rest and reenergize? If not, are there other ways you can help as they rebuild their teams?
• Help franchisees recognize their employees who are working hard to keep the doors open. Some corporate field support team members are attending franchisee staff meetings to provide some company “hurrahs” and calling out employees who deserve kudos.
• Both franchisor staff and franchisee staff love to be recognized publicly and receive prizes and awards. Some of the ideas shared at the roundtable were having door dash certificates to send (teams can order together and have a virtual lunch, or just a chance to order on their own) and using gift cards or programs that allow employees to pick the award they want.  
• Help them find more people. While franchisors don’t get involved in who franchisees hire, there are ways to help them build up their teams. Some franchisors are holding regional job fairs, some have their field support people asking current employees when visiting locations, “If you were fired today, where would you look for the next job?” and others are sharing ideas from other systems that work, like, can they job share with managers from other concepts with different hours of operation? Or, can they jump into Facebook groups where people are looking for part time work? 

(See FBR’s Ultimate Guide to Franchise Employee Engagement for more tactical ideas for your organization.)

2. Use of technology and tools are increasingly more important. Franchisors and their operations teams are using more technology to support franchisees. Even as field teams are back to in-person visits, a lot of the tools we leaned on in 2020 are here to stay:

• Dashboards: Sharing metrics through a platform all franchisees can access allows them to identify and connect with top performers within the system to ask questions and drive business decisions for their own locations. 
• Zoom (or similar platforms): These are effective in having better conversations all around. It’s a way to connect with people and understand if they are receiving (or reacting) to the information. Our roundtable participants are continuing to use this for their one-on one-conversations, in facilitating small group calls, and doing large system-wide calls (45 to 60 minutes) with the executive team. This type of visibility and access to the higher ups is great for building a strong team culture.
• Social Media: Going hand-in-hand with Zoom, brands are using social media outlets to reconnect with their teams in a LIVE virtual community atmosphere. Whether it’s hosting a daily “town hall” or creating a weekly interview series, leaders are seeing the (cost-efficient) value of logging onto Facebook for their teams.
  

3. Franchisees need and expect more support and coaching-up. Operations teams are no longer focused just on compliance. Field teams are crucial in helping franchisees be more successful and there is a shift in the kind of support franchisees need and expect from corporate teams. Here are some of the ways franchisors are doing that:

• Spending more time on cash flow analysis to help franchisees understand the importance of cash flow. Teach field operations team members to identify leading indicators or red flags that trouble is brewing (like when payroll is not happening/drastically decreases), instead of waiting for the crisis or challenge to be here. 
• AnalyzingP&Ls from the first 12 months of each franchisee who opened in the last year, and sharing P&Ls (mo 1, mo 2, etc…) with new franchisees to give them detailed expectations of how they are doing in comparison to others as they ramp up. 
• Creating “Measure Up” template checklists created by other franchisees as a business check up. Some even identified franchisees that were strong in certain areas to be mentors to others who are struggling in that area.

As we near the halfway point of the year it’s a great time to assess how you support franchisees in 2021 and beyond. What changes are worth keeping? Is it time to go back to anything in the “old way of doing things,” and most importantly, how can you connect with operations executives from other brands to learn best practices and solve your internal issues?  We hope to see your operations franchisee  support staff at IFA’s Operations Conference in Chicago on October 4th and 5th. Drop us a note and let us know if you will be there!

We’ll be continuing our roundtables this summer, and we look forward to sharing more of the insights that develop. Spaces are limited, but please reach out if you would like to join the conversation and we will share any available dates. We look forward to seeing everyone IN PERSON soon! 

Related Resource: 

5 Operations Pitfalls That Are Stunting Your Franchise Growth

Before you spend another dime on development efforts, learn five common operations pitfalls that franchisors miss – and how to fix them. Download our free guide to learn how to mitigate risks like:

• Letting franchise manuals languish
• Training and support that’s “good enough”
• Underestimating the role of culture
• Relying on unit level economics
• Treating symptoms, not the cause