Turning Your Franchise Business Back On: The Time To Plan Is Now Written By Michael Seid & Kay Ainsley
T he dramatic morphing, scaling back and, in many cases, shutdown of franchising resulting from social distancing is going to end soon. Now is the time to plan how to scale your franchise system back up.
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e are living through unprecedented times, with an uncertain timeline for when any sense of normalcy will return. The government’s guidance for reopening parts of the economy has continued to change as circumstances on the ground change, and it will be May or June before we begin to see some franchise systems open again for business. Since the shutdown, we have been in close contact with our franchisor clients on how best to reopen their franchise systems when the time comes, and we want to share some of that guidance with you. Our clients have, of course, been staying in close contact with their franchisees, especially those where the franchisees have remained open in some capacity and have continued to stay in touch with their suppliers. While franchisee recruitment has been affected, franchisors are still working with franchisee candidates in their pipeline.
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FRANCHISEUpdate
ISSUE 2, 2020
Some are dealing with new franchisees who have signed but are considering changing their minds. All of them are actively working through the issues of determining their best approach to turning their franchise systems back on when the time comes. Few of us have ever experienced turning an entire franchise system back on, and none of us has ever done it after a national business interruption like we are going through now. Here are three critical findings we have identified: 1. There is no one-size-fits-all approach to reopening franchise systems. Franchise systems differ in industry, size, resources, leadership, maturity, geography, culture, customer profiles, regulations, economics, and relationship between the franchisor and the franchisees. Fungible solutions and best practices adopted by others are not likely to work for everyone, even in the same industry subset. Solutions will need to be contextual. 2. Franchisors are going to need to feel their way a bit, and be nimble in making decisions quickly as issues arise. It is expected that decision-making will need to be pushed
