A Franchisor's Guide to Recovering From the Coronavirus Pandemic | Franchise Law Blog

Franchise Development and Legal Steps Franchisors Should Take to Recover from the Coronavirus Pandemic

In our article “What Coronavirus Means for Franchise Brands and a Roadmap for Franchise Recovery” and part 1 of our three-part webinar “What Coronavirus (COVID-19) will Mean for Franchise Brands”, we outlined a recovery framework focused on strategic planning during the following three stages of this pandemic: (a) short-term phase, as the pandemic escalates to peak levels in the United States now and over the next 1, 2, 3, (?) weeks, (b) intermediate-phase, once the pandemic peaks and we enter a de-escalation phase where new infections start going down from their peak levels, and (c) the Recovery and Growth Phase, once the virus is deemed contained and markets normalize.

The biggest variable is timing, and, at this stage, we just don’t know how long “short-term” is, but what we do know is that, as with all historical challenges, we will (eventually) enter a recovery and growth phase. For franchisors and franchise brands, the primary question right now is what steps should brands take now during the short-term and intermediate-term to protect their franchise systems and recover and grow.

Below are some of the tactical steps that we recommend and have discussed during our webinar

Short-Term: Brace for Impact, Defensive Measures, Legal Adjustments

During this short-term period – from right now until peak infections are reached, stabilize and start to decline – we recommend that franchisors focus on:

Right now, during this short-term “brace for impact” period, you should be evaluating all of these factors. If you can’t tell a compelling story as to each and every point (a) through (e), then now is the time to potentially pause your marketing dollars and make adjustments to improve the value proposition of your system. Most important will be franchisee validation. Once we enter a recovery, every franchisor will be judged by how well they supported and stood beside their franchisees during this crisis.

Intermediate-Term: Offensive Recovery, Redefine Your Brand, Legal Adjustments

Since we don’t know when we will reach peak infections, we don’t know when we will enter this intermediate, pre-recovery phase. Our hope is that it will be 2 to 4 weeks away – at least, that is our hope. During this intermediate phase, we recommend that franchise brands start positioning for an offensive recovery. Waiting until we reach a recovery phase will be too late and too expensive. During this period, we recommend that franchisors focus on:

If we take care of the short-term and intermediate planning and actions, long-term recovery will be at hand. A shake-out is coming, but so is opportunity.

Watch the full webinar below.

Find Out How We Can Help Your Brand: To learn more about our legal services for emerging and growing franchise brands and our Franchise Growth Mastermind, contact us at (800) 976-4904 or by email.

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