Coaching Franchisees To Success in a Challenging Economy

September 2008 Franchising World

The tough economy has invaded every aspect of the business world. The affects of rising gas prices, food costs and curbing spending habits among consumers are being felt in every industry. In franchising, the softening of the economy is serving as a loud wake up call to franchisors.

By Daniel M. Murphy

Taking Action
Franchisors have two options: they can sit back and commiserate with their peers about lagging system-wide sales or fewer eager franchise buyers or they can take proactive steps to combat the situation. From reading trade publications and watching television coverage, it’s apparent that many franchisors are indeed taking progressive action, such as cutting production costs, reducing energy use, utilizing money-savings coupon promotions to entice consumers, and taking many other measures to attract and retain their customer base.

One additional approach that’s increasingly being implemented by many franchisors is the use of group-oriented business coaching on a system-wide level for their franchisees. Many franchise systems are finding that group- business coaching is the final missing link in the total support and development of helping franchisees become effective, focused and strategic owners of the franchise brand.

By implementing a group-oriented, strategic-focusing process in their systems, franchisors will be giving franchisees the opportunity to work on themselves and their businesses on a regular basis, usually quarterly. They will be able to openly and freely discuss techniques, problems and solutions with their peers under the guidance of an objective and professional coach utilizing a proven coaching process.

Simply put, group-oriented business coaching is the art and science of counseling franchisees to overcome obstacles that keep them from reaching optimal success in business, and satisfaction in life. It focuses on their growth and development as business owners: their mindsets, knowledge, skills and habits. Unlike one-on-one coaching, this type of coaching is delivered in a group format, it can be less expensive.

With a system-wide business coaching program, franchisees are given the structure, discipline and processes to improve three essential components: their business, themselves as owners and the quality of their personal lives. In short, franchisees are educated to think and act like strategic business owners. This is obviously beneficial and important for any franchise owner, but especially critical during an economic downturn.

The use of group-oriented business coaching in a franchise system can accomplish the following:
• Empower franchisees to determine with clarity where they want to go and help them develop a focused action plan to get there;
• Provide them with objective and ongoing reviews to help them make adjustments to the action plan to stay on course;
• Give them a rare opportunity to collaborate with other franchisees in the system to share “best practices;” and,
• Help them stay committed to their franchise system and avoid “business-owner burnout.”

Franchisees, like all small-business owners, are susceptible to losing sight of the big picture and getting lost in the trivial details of a business. They risk getting overwhelmed, overworked and feeling like prisoners to the business. Franchisees’ three greatest enemies are busy-ness, denial and distractions. Business coaching makes them aware of and how to effectively avoid these energy and results-draining enemies. After all, unless franchise owners enlarge their mindset, knowledge and habits, their businesses will not grow.

Like every great athlete, no matter the sport, franchisees need additional motivation to keep them on the right track and stay focused on the big picture surrounding the performance of their franchise location. However, a franchisor cannot possibly be the head coach for the entire franchise system, keeping each individual franchisee in the game at the same time because each franchisee is unique with different issues. Outside of visiting every location on a regular basis, a third-party coach is often the only practical way to keep the system motivated and on track.

In addition, because franchisees traditionally resist constant advice from corporate headquarters on how to run their businesses, and are turned off by ever-increasing monitoring of their actions, participation in group coaching with their peers is an effective way to help them succeed, while not invading their independence. The coach should be independent and objective and have no ties to the corporate office. This allows franchisees to freely speak their minds and to be truly honest about their situation, strengths, weaknesses and challenges. Getting a client to accept the truth—whether it is good, bad or ugly—is a critical component for personal growth and progress.

The gathering of franchisees in one room with an expert coach and process, providing unbiased leadership, can empower franchisees to clearly define a goal and develop a focused action plan to get there. In this setting, similar to that of a popular weight-loss program, ongoing accountability and group support and subtle peer pressure are key components to achieving sustained results. Franchisees will be objectively reviewed and must take responsibility for their thoughts and actions and for the development and adaptation of their location’s roadmap to success.

By adding group-oriented business coaching to their support systems for franchisees, franchisors should be able to recognize greater franchisee satisfaction, system-wide revenue growth, stronger multi-unit operations and less franchisee burnout. In doing so, franchisors will be taking the next progressive step to set up their franchisees for even greater success and satisfaction as owners.

Daniel M. Murphy is the president and founder of The Growth Coach. He can be reached at 513-563-0570 ext.104 or d.murphy@thegrowthcoach.com.