10 Components of Franchise Excellence

Published on March 01, 2017

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Throughout the years, storied franchise programs have shared common attributes that separate these systems from the rest of the franchise universe. These top performing franchisors adhere to specific operating principles and follow best practices that are an integral part of their franchise program. These components are exclusive of size and should be a part of every franchise both large and small.

Here Are My 10 Components of Franchise Excellence

  1. The foundation of the franchise is built on equitable franchisee ROI
    The structure of the franchise program both operationally and financially provides franchisees an opportunity for a fair financial return that does not require extraordinary performance.
  2. If the franchise program requires adjustments they’re done
    If certain products or services aren’t successful they find alternatives. These franchisors don’t let ego get in the way of what’s best for the system.
  3. The franchisor controls the franchise sales process and adheres to its franchisee profile
    One of the most frequent reasons for franchisee failures is undercapitalization followed by a lack of skills needed to operate the franchise successfully. The franchisee profile is the standard and if franchise candidates don’t fit this profile they are turned down.
  4. Total transparency with prospective franchisees
    They provide prospective franchisees what is needed to be successful. They don’t sugarcoat the franchise opportunity.
  5. Franchisor leadership is fully engaged in the franchise operation
    Franchisor executive leadership is fully involved in the franchise so they are aware of the systems successes and failures. Important franchisee feedback will flow to the franchisor leadership.
  6. Franchisee input is solicited for important operational and marketing strategies
    The franchisor will include its franchisees in important decisions impacting the network. This will be done using the Franchisee Association, FAC, advertising committee or other representative franchisee body.
  7. New products, services and marketing programs are thoroughly evaluated before being launched
    New products, services or equipment are tested in select franchisee locations before introducing them. This process leads to an objective and credible result for the rest of the franchise network to decide upon.
  8. Gathers financial results from franchisees on a regular basis
    Despite certain requirements set forth in franchise agreements it’s been my experience that many franchisors fail to obtain financial results or reports from their franchisees on a regular basis. However, the top performing franchisees gather financial data.
  9. Protects the integrity and standards of the franchise brand
    The franchisor upholds the standards of the franchise brand. The franchisees that follow the program deserve it and the customers that use the product or services provided by the franchisees are entitled to consistency.
  10. They invest in franchisee training and support
    Top performing franchisors have effective training programs and training does not end with start-up franchisee training. When franchise operations identify weaknesses in the execution of their best franchise practices the training component will be should implemented in order to address the problem.

The top performing franchise systems share certain attributes and operating practices that they adhere to. Franchisors that seek to be a part of this select group should strive to follow the example of the excellent franchise programs.


About the Author: Ed Teixeira
Ed Teixeira is a recognized franchise expert with over 35 years experience in the franchise industry. He has served as a corporate executive for franchise firms in the retail, manufacturing, healthcare and technology industries and was a franchisee of a multi-million dollar home healthcare franchise. Ed is the author of Franchising From the Inside Out and The Franchise Buyers Manual. He has participated in the CEO Magazine Roundtable Meetings with business leaders from around the country and spoke at a number of venues including the International Franchise Expo and the Chinese Franchise Association in Shanghai, China. Over the course of his career, Ed has been involved with over 1,000 franchise locations and launched franchise concepts from existing business models. Ed can be contacted at 631-246-5782 or ed.teixeira@franchisegrade.com.
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