Understanding The Three Factors of Franchise Success: Circumstances, Operations, And Humanity

by Scott Greenberg, author of “The Wealthy Franchisee: Game-Changing Steps to Becoming a Thriving Franchise Superstar“

During the 10 years I ran my Edible Arrangements franchises, I spent a lot of time reflecting on my stores’ performance. I monitored my numbers. I analyzed the market. I constantly checked in with my employees. I wanted to understand everything impacting my business. Whether it was the cost of wholesale fruit, new competition or even my own attitude, I wanted stay on top of every element making a difference. I realized I could separate all important factors into three different categories: Circumstances, Operations and Humanity.

Circumstances are the larger, outside issues impacting a business. They’re the landscape where we operate. Circumstances include the economy, government regulation, the weather and other factors we don’t control. Often business owners blame them for poor performance. It’s an easy way to skirt responsibility. These factors are real and can be lethal to a business (think Covid-19). But in most cases, there’s a lot more going on business owners don’t realize or acknowledge.

Operations are the systems, policies and procedures for running a business. They include sales, marketing, the product line and pricing. It’s your recipes, your hiring practices and your bookkeeping. Operations are all the things that keep you busy. If you own a franchise, operations are what you pay your franchisor to teach you.

Humanity is the people element of a business. It’s your attitude and mindset. It’s your level of resilience and your ability to keep a clear head. It’s the social dynamics and culture of your team. It’s the way you make customers feel. The human elements are what most distinguish top businesses from typical ones as they directly impact how operations are executed. They’re the difference between courageous and fearful, friendly and robotic, and supportive and soul-crushing. Humanity is what you bring to the business.

Business thrives when all three factors are monitored and managed. While your level of control varies in each area, remaining active across all three is the key to success. Here are few tips for each:

Three Tips for Better Circumstances.

Monitor and Respond. We may not be able control circumstances, but we need to be aware of them. The more closely we watch the economy, labor laws, consumer trends and other outside factors, the quicker we can take action. That might mean seizing an opportunity or managing adversity. Keep your finger on the pulse of your industry and never let your guard down. Complacency is deadly. Be ready to adapt. Your franchisor is probably watching circumstances closely and will propose changes to the model and product line accordingly. Be ready to adopt.

Anticipate and Prepare. Even without a crystal ball, you can see what’s coming. You can expect new innovations and competitors. You can watch the news. You know that economies are cyclical. And even if you don’t know the specifics, you can still think of ways your business could be impacted by unforeseen circumstances. You may not have predicted a global pandemic, but it’s reasonable to predict a situation that, at some point, could limit or stop sales. Whatever the cause, how can you prepare for that—operationally, financially, and beyond? Before crisis happens, put on your most cynical hat and brainstorm everything that could go wrong. Then come up with plans for if and when they do. Hopefully, this will be time wasted. But should circumstances turn on you, you’ll be glad you prepared in advance, and while you’re clearheaded.

Let Go and Refocus. It’s easy to get consumed by challenges you can’t control. There comes a point when you need to disengage from them and focus instead on where you do have control. Don’t worry about the competition. Put your energy on better execution. You can’t change the economy, but you can reduce expenses and increase marketing. You were never in control of everything. Your time is best spent on the things within your power. And there are more of them than you might think.

Three Tips for Better Operations. 

Stick to the System. One of the great advantages of running a franchise is having a corporate office that has figured how to run the business successfully and is always working to refine their proven system. Rarely do franchisees operate better when they deviate from the model. Leave the innovation to your franchisor and focus instead on great execution.

Continuously improve. While you shouldn’t change the system, you should be forever trying to improve the way you work within it. How can you produce more quickly? What more can you do more safely? How can you decrease costs and increase efficiency? Look at last year’s numbers and seek to build them. Always think in terms of “better.”

Communicate with other franchisees. Another great advantage of a franchise business is the network you get to join. There’s a whole brain trust of folks out there running the same operation. Stay in touch with your fellow franchisees and solicit ideas. See what’s working. How are they controlling costs? How are they driving in customers? Ask these questions, and then ask them again a few months later. Be willing to share your best practices as well.

Three Tips for Better Humanity.

Think better. Your mindset can you be your greatest asset or worst liability. Monitor your thoughts and emotions. Notice how they’re impacting your decisions. A negative attitude can blind you to opportunities, increase your stress and bring down others. An overly positive attitude can cause you to make irresponsible decisions, based less on data and information and more on hope and enthusiasm. Try to keep a clear, calm head. Keep all emotions in check.

Lead better. Rather than directing your employee’s work, focus on their development. Like you, they also have thoughts and emotions and humanity. Build them up. Pump them up. Lovingly (with tough love, if necessary) grow them into leaders. In turn, they’ll help you grow your business.

Serve better. Instead of simply facilitating transactions, create meaningful, memorable experiences. Focus on both what the customer gets and how the customer feels. The feeling you give them is what they’ll remember. It’s what inspires what they say about you, what they post about you and whether or not they’ll return. Work to elevate the emotional state of every customer.

Franchisors respond to circumstances and constantly work on operations. The human element is on you. Work hard to maintain the right individual mindset and the most collaborative business culture. These are essential ingredients in the recipe for franchise success.

 

Scott Greenberg in an internationally recognized speaker, author and coach who helps franchise owners grow their businesses, build high-performing teams and create unforgettable customer experiences. For 10 years, he was a multi-unit franchise owner with Edible Arrangements, winning Best Customer Service and Manager of the Year awards out of more than 1,000 locations worldwide. Learn more about his new book, “The Wealthy Franchisee: Game-Changing Steps to Becoming a Thriving Franchise Superstar“.

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