Is the Slow Ramp-up of your Franchisees Costing You too Much? Is It Risking the Success of your Franchisees?

cost dollars

The costs associated with slow franchisee ramp-up are many. Often slow ramp-ups even risk your franchisees’ chance of success. Slow ramp-ups affect not only the franchisee in question, but the entire network and your own staff are also influenced by under-performing franchisees. The costs of franchisees’ slow ramp-ups include:

  1. Unplanned Expenses. When franchisees struggle, more unplanned training and support resources are necessary to remedy their situation. The money franchisors spend in this effort is often syphoned away from resources the franchisor would have invested in strengthening the system, hiring key people, introducing innovation, and improving the long-term stability of the brand. 
  2. Poor Morale.  As the franchisor’s support staff appear to take one distressed call after another from a steady stream of “problem” franchisees, their own morale suffers. They begin to doubt that the system works. They become more detached and frustrated, which impacts the entire system.
  3. Fractured Franchisee Relationships.  Struggling franchisees get frustrated and discouraged, and they share their disappointment with other franchisees, bringing down the morale of the entire system and fracturing the franchisee-franchisor relationship.
  4. Halted Momentum.  The enthusiasm that franchisees experience during training is thwarted if they can’t produce results when they get back home. Once lost, this momentum can’t be recovered and a new drive must be created, which is not easy to do.
  5. Poor Validation. As frustration levels go up, validation starts to suffer as under-producing and unsatisfied franchisees share their frustration with prospects. Negative franchisee validation destroys franchise sales, halts growth, eliminates future royalty streams, and decreases the dollars franchisors can spend on tools and support systems to avoid the problem.
  6. Brand Deterioration.  Under-producing, unhappy franchisees create negative customer experiences. If the unit or territory fails, customers will remember, and it will be difficult and, in some cases, perhaps even impossible to regain lost traction.
  7. Breakdown in Leadership.  Struggling franchisees rally other franchisees or franchisor’s support staff to their plight affecting the franchisor’s ability to effectively lead the larger franchisee body. In many systems, the frustration engendered by this breakdown in leadership creates a culture of compliance and top-down authority, rather than a participatory culture focused on positive relationships and results.  

Unfortunately, some franchisors actually add to the ramp-up problem. My next post will address how they do it; make sure to read it to see if you too, unknowingly, may be adding to the problem.

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  1. Operations says:

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