While franchisee failure may be inevitable for a select percentage of franchisees and, in may cases, may have nothing to do with the franchise system (i.e., a franchisee who refuses to roll up his or her sleeves and commit to hard work), one thing that this economic downturn has exposed is the fact that many franchisees (too many) are not raving fans of the franchise system(s) in which they operate.
In speaking with franchisors and franchisees over the past number of months, one critical issue that appears to be adding to this disconnect may be franchisor implemented policies designed to generate additional franchisor revenue through non-franchisee channels of distribution. When evaluating your franchise system and the potential for generating additional system revenues, one critical resource that is often overlooked is existing franchisees. Recently, after reading Ken Blanchard and Sheldon Bowles insightful book, Raving Fans – A Revolutionary Approach to Customer Service, it became clear to me that too many franchisors are overlooking a critical asset and opportunity: revenue growth generated by existing franchisees who are converted to raving fans.
Again, while not all franchisees are right for every franchise system and while certain franchisees may never get it as a franchisor, I believe that you must develop the systems, procedures and policies that will turn your franchisee base into raving fans. Following the advice of Mr. Blanchard and Mr. Bowles, you should start by assessing and understanding:
(a) What you expect from your franchisees;
(b) What your franchisees want from you; and
(c) How to deliver what your franchisees want plus an extra one percent.
Evaluating and understanding these factors/answering these questions, can only help to further refine and improve your franchise system. The incremental sales (in terms of franchise unit growth and gross revenue) that could be generated by franchisees that are raving fans could prove substantial and, in my opinion, represents a critical resource that many are overlooking. If you have not read Raving Fans, I strongly recommend it.