Callum Floyd is a Franchising & Licensing Expert

Franchisors will typically closely monitor total systemwide sales as, for most, their primary income source (that is, a royalty based on sales) depends upon it. A less frequently measured and monitored, but equally important, key performance indicator, is comparable sales. While total systemwide sales reflects all sales to customers (by franchised and company units), comparable …

Field managers are increasingly taking on more of a business advisory role in their support of franchisees. Related, other best practices in this series speak of the importance of franchisee business planning, having a franchisee business planning template, the need for field managers to take on a business advisory role, and focusing on franchisee profit …

This best practice speaks to the need for senior franchise executives to be involved in a Franchise Advisory Council (FAC). A FAC’s purpose will often include the objective of taking both franchisor and franchisee businesses forward which, in turn, encompasses the whole franchise system. It therefore follows that a FAC should include franchisor representatives that …

Board meeting duration is an important governance dimension. Previous best practices have covered franchise governance structure fit, governance focus on the future and board meeting regularity. Key here is ensuring adequate time and focus is afforded to the many elements of governance in a regular board meeting. The governance role includes compliance, monitoring and controls, …

History has demonstrated the importance of having an active Crisis Management Plan. This should be regarded as a core franchisor responsibility. While some companies will clearly be more susceptible to potential crises, there are a myriad of situations that could impact any franchise organisation.  Crises could be generated from customer interactions (e.g., food poisoning, poor …

This is a best practice for both potential franchisees and established franchisors. We believe it is best practice for a franchisor to require potential franchisees to seek specialist legal and accounting advice, as a minimum, before signing a franchise agreement. There is research that demonstrates use of advisors to be associated with higher levels of …

As discussed in a previous best practice, we regard Franchisee Business Planning as a critical franchise system management process. We believe comprehensive franchisee business planning to be an important driver of both franchisee and, as a by-product, franchisor performance. Within this we regard a Franchisee Business Planning Template that is bespoke to the business as …

A Franchise Advisory Council (FAC) should involve good franchisee representation. That means that there should be a meaningful diversity of franchisee members on the council. In our view that diversity or representativeness will help facilitate achievement of the FAC purpose. Importantly also, we believe it will help franchisees (generally) see the FAC as a valid, …

This best practice speaks to how franchisors approach the frequent need for change within a franchise system. Change is fundamental to long-term sustainability – and, in franchising, change invariably involves and impacts franchisees. Here we suggest a basic scientific approach to innovation that provides evidence for proposed changes. Franchisees own their own businesses and, while …