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Callum Floyd / April 23, 2019

Franchise System Reviews

The world of business and franchising is changing rapidly. Accordingly, in our experience, franchising companies benefit strongly from a periodic franchise system review.

Based on our experience, franchise system reviews have provided participating companies an important opportunity to put a stake in the ground and then move forward; taking stock of the situation and performance levels throughout the organisation, and the appropriateness of the current franchise structure and management approach of the time. The franchise system review also harnesses franchisee input, before identifying prioritised areas of change – all targeted at improving franchisor and franchisee performance, value and long-term sustainability.

A comprehensive franchise system review, of the nature undertaken by Franchize Consultants (for more than a decade), is often initiated by:

  • Great franchise systems looking for a further edge – and often committed to best practice franchising
  • Franchise systems seeking performance improvements, and/or
  • Franchise systems that have challenging problems to correct

The benefits of such a review is an ‘independent and unbiased’ review by management consultants that specialise in franchise system performance improvements. In all cases our reviews have identified a host of unique, impactful and prioritised solutions – all targeted at improving franchisor and franchisee businesses.

A comprehensive franchise system review considers a multitude of elements of a franchise structure (e.g., franchise agreement elements, manuals, communication, field visits, unit-level business model, marketing, performance management, etc), along with the governance and management of key management processes. A comprehensive franchise system review also reviews performance (financial and non-financial, including franchisee satisfaction) at all levels, as well as harnessing the input and review of franchisee operations and perspectives. It is a substantial and important undertaking.

What are the indicators suggesting you need a franchise review?

  • Desire for market leadership and best practice franchising position
  • Several years franchising
  • Strong, organised competition
  • Business model disruption evident
  • Nearing renewal time
  • Low franchisee satisfaction and engagement
  • Stagnant / declining franchisee returns
  • FSO staff tenure and satisfaction
  • Power imbalances
  • Franchisee resistance to innovation and change
  • Desire for improved franchisor returns

A regular and comprehensive franchise system review sets an important foundation from which improvements can be generated and addressed for all key stakeholders.

Best practice, in our view, is undertaking a comprehensive franchise system review, every five to eight years – with the regularity dependent on the situation.

Relevant questions:

  • What benefits could an independent and unbiased franchise system review (by franchise management consulting specialists) bring to your franchisor and franchisee businesses – long-term?

About the Franchising Best Practice 500 Series

Franchise Best Practice Handbook

This is part of a series of franchising best practices. Franchize Consultants is sharing and publishing these best practices weekly for the betterment of franchising. We know that better knowledge and execution of franchising best practices leads to bigger and more valuable franchisor and franchisee businesses.

We have assembled the first 40 best practices into The Best Practice Handbook, which is available for purchase.

You can make contact with us on +64 (0) 9 523 3858 or via the contact form below for any further information. You can also connect with us on Facebook, LinkedIn and Google.

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For more information please enter your details below and one of our Senior Consultants will be in touch.

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