The following article includes insights from ProfitKeeper by PrimePay’s Director of Business Analytics, Eddie Goitia, a franchise expert and industry veteran with a strong track record in delivering client-centric strategies that can create growth and exceptional client loyalty.
As a franchise owner, you may already understand that competition isn’t limited to other franchises alone. There are big-name brands in almost every city and town across the country, which means you'll likely have to compete not only with other local franchises and businesses, but also corporations with large marketing expenditures and even greater brand recognition.
To compete and get your franchise ahead of the game, consider doing what many large corporations do - while minding your budget, of course.
Continue reading for some dos and don’ts for when it comes to staying competitive in the franchise industry.
Do take advantage of technology.
There are many tasks to keep track of as a franchise owner, such as hiring and training employees, running the franchise according to franchisor expectations, financial responsibilities, and day-to-day operations. While these tasks often require careful attention, technology can help alleviate some of the burdens.
Choosing the right technology stack for your franchise is critical in ensuring you have important administrative and daily operative tasks covered, so you can better focus on the growth of your franchise. Technology such as Human Capital Management (HCM) software can solve many HR-related issues by improving your time and attendance reporting, recruiting efforts, and overall management. Some solutions include a direct feed into a payroll system, eliminating the need to manage the payroll and HRMS link. Additionally, there is technology in the market that is focused on helping franchises analyze financials, automate reporting, benchmark, gather critical data, and more.
Are you considering implementing technology into your franchise and unsure of where to start? Begin by exploring some options. It’s important that you analyze each option and conduct research to ensure you choose the right technology for you. Keep one thing in mind during your research, and ask yourself: “Will this technology put me at a competitive advantage?” When analyzing various options, if there are no roadblocks or friction points, ask the technology provider of interest for a beta test or a demo to bring you one step closer to a confident decision.
If you already have technology for your franchise, consider revisiting on a regular basis to check that you are keeping up with the latest technology as investing in current technology can help optimize your business even further.
Do leverage Social Media.
According to the Cybersecurity and Infrastructure Security Agency (CISA), 4.48 billion individuals were reported using social media in 2021, which is an increase of 13% of users in 2020. To put it another way, social media is used by over 57% of the world's population. With social media maintaining such a growing population, there are plenty of opportunities to promote your franchise on a wide scale.
There are plenty of ways to optimize your social media strategy. First off, look at what your competitors are doing, and go one step higher. The opportunities are endless with social media, see below for some share examples:
- Promote specials and events.
- Post job opportunities.
- Share branded content for recognition and other helpful, value-add resources like blogs, case studies, client testimonials, videos, and more.
You don’t have to manage social media alone; there are plenty of affordable social media scheduling platforms out there for your use to make things easier. You can even consider encouraging your employees to be active in promoting your franchise on social media, with proper guidelines, of course. However, it certainly is not limited to employees only. Consider building relationships with local influencers and come up with ways to motivate them to recommend your franchise on social media. Being active on social media goes a long way in gaining brand awareness for your franchise.
Do up your email marketing game.
While social media may be moving up in popularity, email is still here to stay. Email marketing systems that offer competitive monthly pricing are relatively easy to find. Find one that best fits your business and put together a digital marketing campaign, or a few.
Before you get started on an email marketing campaign, however, think of creative ways to capture emails so you have a list of individuals to connect with to share updates on your franchise, sales, deals, general information, surveys, and more. If you have a Point of Sales (POS) system that allows you to enter client information, be sure to ask individuals if they are interested in receiving updates about your franchise via email. You could also consider offering a discount to clients that provide their email upon purchase. Last, if you have a client rewards program, be sure to capture client contact information upon signing up so you can keep in touch with them.
Do optimize your suppliers and vendors.
A strong supply chain partner is critical in managing inventory or food costs, margins, profitability, and more. Be sure to choose supply chain co-operatives that increase your buying power on everything from food to beverages to paper goods. Vendors are just as essential to your success in that they help provide you with all of the products and services you need to keep things running properly. Just like revisiting your technology stack, revisit your suppliers and vendors regularly to understand if you are receiving the best value. Additionally, franchisees can take advantage of all buying opportunities that the franchisor may have available with preferred vendors.
Consider what larger companies are doing as well, and that is, they may commonly bid on suppliers. As such, think about bidding on all suppliers, and monitoring a bidding schedule with all contract dates and periods of the year when you're bidding on non-contracted services.
For food franchises, where there is flexibility in the menu, pay attention to your food supplier specials as you may be able to take advantage of those at a great price so you can fill your menu with limited-time items.
Do keep track of franchise data and analytics.
From a franchisee's perspective, there is tremendous value in analyzing your business. It provides a way for you to see which meaningful metrics are trending up and trending down which can help you to focus on understanding why these changes are occurring. One of the most powerful parts about franchising and monitoring analytics is that it gives the tools necessary to increase your visibility and profits.
Once you can identify what you need to do to generate greater success, you can go and ask for support from the franchisor and other franchisees for best practices.
Interested in reading more about franchise data and analytics? Click here to read our previous blog, “How Do I Use Franchise Analytics for Business Growth?”
Do get involved in the community.
Whether you are new to the community, or a long-term resident, spread the word on your local franchise. Below are a few ways to get the word out:
- Let locals know you are building a business in your community.
- Co-market with other local businesses.
- When you need to buy gift certificates for your staff or family, find a complementary business and promote a cross-relationship of buying each other’s gift certificates.
- With permission, promote your franchise in local advertising. For example, “This franchise is locally owned by Dana and Pat Jones.”
- Find a local charity to support.
- Local sporting events should always be on your radar and get to know the teams. Promote near them, and encourage them to stop by after the game.
Last, don’t forget about family and friends. The larger your support circle, the more buzz about your franchise!
Do promote specials and events.
Promotions and events are often enticing to the day-to-day consumer. You can always find a reason to celebrate and promote, so why not give it a chance? Below are a couple of ways to consider launching your own promotions and events:
- React to a changing environment the same day through promotions, and specials. For example, if your community is hosting an event, if there’s a national day, like Small Business Saturday, be sure to participate.
- Create a local marketing calendar and be prepared to act upon all opportunities that may bring you business.
It doesn’t have to be a holiday to promote an event or offer a special. Your franchise is special enough!
Do encourage client feedback.
Client feedback is critical in helping you to understand areas of improvement. Luckily, it’s not always difficult to obtain. Build relationships with your clients and kindly ask if they would be willing to leave a positive review online or refer your franchise to a friend.
You can also have a small banner or flyer hand-out encouraging people to leave a review. Make it easy for the client to do so, by considering incorporating a QR code, or a URL as to where they can leave a review.
By encouraging client feedback, you not only benefit from the awareness of how you can enhance your franchise, but you may even receive recommendations for products and services to implement that could get you one step ahead of the competition.
Don’t lose sight of regulars.
If you have clients that visit regularly, be sure to let them know you appreciate them by offering a free sample, giveaway item, or a voucher for their next visit. Another great way to keep your regulars engaged is by offering a rewards program. This could be a punch card or an electronic system that allows clients to punch in or enter in a number each time to allow each visit to be one step closer to a free or special item.
Don’t ignore client reviews.
Everybody makes mistakes. A big part of maintaining your reputation, especially online, is client reviews. According to G2, 82% of consumers consider review sites to be helpful in their research. Make sure you monitor them on a regular basis and address any concerns by offering something in return. This could be a product replacement, a refund, a store credit, etc.
Don’t lose sight of your budget.
Make sure you are keeping an eye on your financials and ensure you are making investments for growth. Before making any purchases for your franchise, ask yourself the following questions:
- “Do I have all the capital I need?”
- “Will this purchase enhance my ability to grow?”
While it’s important to have sufficient cash in the bank, it’s also essential that you prepare a budget to guide you through each year. Financial planning starts before you open the doors. It really begins the moment you sign your franchise agreement.
- Take the time to lay out a budget and forecast based on the franchise model. Project your franchise revenue curve over the next 24 months, using historic franchisee startup revenue data as a benchmark.
- Align your budget with your cash flow.
- Ask yourself, have you enlisted the help of a bookkeeper, who understands your business and has worked with similar concepts? Is there a system set up so you can quickly and efficiently move documents back and forth to get your books done?
Keeping a close eye on your budget can help you to avoid unwanted issues in the future, and allow you to stay on a path of growth.
Don’t ignore laws and regulations.
With any business comes laws and regulations. Be sure to keep track of your requirements when it comes to employment law and franchise laws. In order to do so, ask your franchisor for support in remaining compliant. Your franchisor may be able to assist you in understanding what is required of you in terms of compliance, as well as provide you with agreements that spell out your responsibilities and establish a consistent tone for legal compliance in terms of brand standards and more.
If you’re interested in learning more about franchise compliance, linked below are additional resources:
- Department of Labor (DOL) Overview of Employment Laws
- Fair Trade Commission Franchise Rule
- Franchise Law
Note: Be sure to consult with your franchisor as they can give you a better idea of your requirements that are specific to your franchise and location.
Don’t forget about your current staff.
In franchise systems, even if a staff member is with you for a short time, they can provide valuable feedback and they may become a loyal client. In order to retain your current staff, it is important that you maintain a positive relationship with them. One way to ensure your staff is happy is with frequent one-on-one meetings. Employees' motivation to give their best efforts is influenced by their feelings of gratitude and appreciation for their efforts and jobs well done. Additionally, continuous feedback outside of the common annual review can boost confidence, and alternatively, shed light on areas of improvement. All of these elements can help lead to greater employee satisfaction and retention.
In the end, the goal is the same – receive employee feedback, and provide coaching and validation, clear takeaways, and actionable items.
Don’t expect results right away.
Ever hear the common phrase, “good things take time?” This phrase certainly applies to franchise growth. When using the above ideas to foster franchise growth, be sure to leave a window of time open to compare starting results with end results. A simple way of monitoring growth over time is benchmarking. Benchmarking can be thought of as a starting point. As a franchisee or business owner, it gives you the power to take action, create new procedures, and do things that will improve your organization.
Don’t be afraid to fail.
Failure is bound to happen, and when it does, don’t let it break you. Instead, use it to your advantage as a learning experience and become greater. Think about all of the top brand names in the country, or the best known entrepreneurs. Chances are, they did not become successful without trying and failing at least once.
Don’t wait to update technology.
Outdated technology can slow you down significantly, leading to you having to quickly divert to backup plans, like dreaded manual processes which may lessen your ability to keep track of vital growth metrics.
Overwhelmed with the thought of keeping track of these tasks and metrics for growth?
ProfitKeeper by PrimePay is here to support you.
The process of collecting and analyzing data does not have to be manual. With ProfitKeeper by PrimePay, franchisors can take advantage of cloud-based software to automate financial tasks that help increase profits.
Imagine a service that not only does the work for you but ensures the data is accurate and useful: That’s ProfitKeeper by PrimePay. Click here to learn more.
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