EARLY INTERVENTION TO INCREASE UNIT LEVEL PROFITABILITY

Once a poorly performing franchise unit is identified, the franchisor must spring into action with decisive communication and commitment to fix what’s wrong. Without early and definitive action and relentless follow-up, struggling franchisees will continue to flounder and eventually fail.

At Kern & Hillman, LLC, we can help franchisors design and implement systems that turn struggling stores around. Call it what you like – sending a franchisee to boot camp, giving a struggling dealer a jump start, a commando raid to turn things around or rallying to a franchisee’s defense – you need a program that is both aggressive and that effects change.

To have a chance at reversing a troubled store’s fortunes these systems must include:

  • A bold statement that the franchisor understands the problem and intends to see it fixed.
  • Regular and systematic communication with the franchisee in trouble and all the constituencies that can help.
  • Dramatically stepped up support from the franchisor’s operations department.
  • Retraining where necessary.
  • Mentoring by successful franchisees on financial, operational, customer service and marketing issues.
  • Market research at the neighborhood level to understand why the unit has failed to flourish while others are succeeding.
  • A dialogue in the entire franchise community about the problems struggling units are facing to tease out solutions others have used.
  • Regular publicity about the new programs’ success.

Good intentions are not enough. Franchise companies all rely on their operating systems, but few have special “emergency repair systems” for franchisees that start slow or later begin to struggle. Let us at the Franchise Law Source help you build these emergency repair systems without illegally discriminating against franchisees or violating your contractual and legal obligations.

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