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Best Practices

Feature Story:

Hwy 55 COO Shares His 7 Keys To Successful, Scalable Growth »

By Neal Dennis

Creating a great business and successful franchise is art and science, timing and luck. While luck and timing are largely out of your control, at Hwy 55 Burgers, Shakes & Fries we’ve learned a lot about the art and science of successful growth. Here are seven key elements and tools that have supported our expansion.

1) Build a great leadership team
A great leadership team is crucial to a franchise’s success. It is impossible for one or two people to do all the work themselves, so create leaders across the organization. Kenney Moore, the CEO and founder of Hwy 55, started the franchise with one location and $500 in his pocket, and went around re-opening closed restaurants. By the time he had opened four locations, he realized he was working himself to death and not making a lot of forward progress...

Feature Story:

Failed Units: Not Just A Franchisee Issue »

By Darrell Johnson

Throughout my career I have observed that a strong alignment of interests between two business parties usually leads to good outcomes for both. All franchisors with any marketing savvy will say they are strongly aligned with their franchisees. What is the evidence that a brand walks the talk?
There are many ways a franchisor can help its franchisees, starting with a full and high-quality support program, and including a disciplined prospect screening program, training that measures results, site selection and opening assistance based on proven criteria, and field operations and compliance that are effective.
Then there's transparency. Brands that have a meaningful Item 19, that have system dashboards that compare unit performance in real time, that support capital access through SBA eligibility and Bank Credit Reports (BCRs), and that seek system feedback through independent third parties are further examples...

Feature Story:

Franchisees Rally For Their Cause On Capitol Hill »

Multi-Unit Franchisee

Franchisees from across the country gathered this week in Washington D.C. to rally around the franchise business model and meet with members of Congress to emphasize the industry's importance. It's the 2015 International Franchise Association's (IFA) Franchise Action Network Annual Meeting, an event that helps get attendees excited and ready for meeting with elected officials on Capitol Hill.
"Not everyone understands the franchise business model and how legislative and regulatory decisions can greatly impact small franchised businesses," said Catherine Monson, CEO of Fastsings and a speaker during the event. "It is critical for all of us in the franchising industry to proactively develop relationships with our Congressional Representatives and Senators in order to preserve and protect the future of our businesses...

Feature Story:

6 Principles Of Customer Service »

Multi-Unit Franchisee

John Tschohl is a best-selling author, an internationally recognized service strategist, and president of Service Quality Institute - a leading customer service organization. He offers a concise and practical list of six essential customer service principles.
These "Personal Steps of Excellence" would go well in a frame on your office wall and those of your general managers.

1. Feel Good About Yourself. Employees do not go to work dreaming about how they can work exceptionally hard to make the company and the owner more money. Be realistic. Many employees have personal problems. The more we can uplift the self worth and self-image of employees, they become more productive and feel like there is a win-win relationship. In return they will deliver a higher level of excellence...

Feature Story:

Outstanding In The Field: Getting What You Need, When You Need It »

By Debbie Selinsky

What franchisees want from corporate field support is pretty straightforward. Basic expectations include great products, marketing and brand support, ongoing training, site selection, purchasing power for goods and services, and participation in product and program testing. While those are the table stakes, what makes systems really successful and builds strong relationships between franchisor and franchisees is communication, consistency, and listening,
"For our organization, what's most important is for our field consultants to communicate the same message," says Spencer Smith, CEO of the Smith Group in Cortez, Colo., which operates nearly 50 Aaron's stores and 3 Rent A Wheel units across 8 western states. "We have 46 Aaron's locations, so we have 5 different field consultants from Canada to Mexico...

Feature Story:

Captain D's Joins A Good Cause »

Captain D's is showing its philanthropic side by joining the Share Our Strength's Dine Out for No Kid Hungry campaign. The program connects kids in need with nutritious food and teaches their families how to eat healthy and affordable meals, while raising national awareness of the childhood hunger epidemic that affects one in five children.
Captain D's, the 512-unit restaurant chain in 26 states, said in a statement that its commitment to its customers goes beyond just the food they serve to families at an affordable price. "We fully support No Kid Hungry's mission to raise awareness about childhood hunger and look forward to uniting with other restaurants across the nation to make a difference in the communities we serve and the lives of families in need," said Phil Greifeld, Captain D's chief executive officer...

Feature Story:

Industry Groups Join To Oppose Overtime Regulations »

Multi-Unit Franchisee

A united front of 15 franchisee associations and the International Franchise Association (IFA) are working together to fight the government's proposed changes to overtime regulations. Together, the groups submitted comments last week declaring the Department of Labor's (DOL) proposed changes to overtime regulations are "fundamentally flawed and bad for employers and employees," according to a statement issued. The IFA also accused the DOL of "failing to extend the comment period on the radical changes that will severely hamper job growth in the small business sector."
"The proposed change to the overtime rule is another action by the Obama Administration that dramatically alters how small businesses operate," said IFA President & CEO Steve Caldeira, CFE...

Feature Story:

Newk's Eatery Focuses On Cancer Awareness »

Multi-Unit Franchisee

With one in 70 women facing ovarian cancer, Newk's Eatery is shining a spotlight on this relatively silent killer by turning up the volume on its growing "Newk's Cares" initiative, which includes permanent changes within the brand to further support the cause. Following a tremendous community response last year, the ongoing ovarian cancer awareness campaign will be re-surging across Newk's more than 80 restaurants throughout the months of August and September to spark awareness and raise needed support for cure research, along with a second-annual Ovarian Cycle Jackson fundraising event.
In honor of Ovarian Cancer Awareness Month in September, Newk's is going teal--the color adopted by the global ovarian cancer awareness movement-- switching out Newk's signature black cups for teal ones, as well as permanently replacing the brand's traditional red straws with teal straws...

Feature Story:

Jamba Refranchising Efforts Moving Along »

Multi-Unit Franchisee

Jamba, Inc., the parent company of Jamba Juice, is continuing to make good on its rebranding initiative launched late last year. Just last month the company announced the completion of a refranchising agreement for 73 stores in the San Jose/East Bay and Sacramento markets. A company release said the brand expects to sell the remaining 27 company locations in the San Diego market by the end of the year.
Last December, Jamba announced the refranchising initiative with a stated goal of refranchising "up to 114" stores during 2015. The company has exceeded its initial plans with closed deals so far this year already representing 150 stores. The company expects that deals for 74 additional stores will be refranchised for three California markets by the end of 2015 and the Chicago/Midwest market by the first quarter of 2016...

Feature Story:

Fund-Amental Change?: Is Aziz Hashim's New Fund For Franchisees A Game-Changer? »

By Eddy Goldberg

Tired of paying royalties? How would you like to get in on collecting them? That's one of the reasons--among many--behind an innovative fund created to allow multi-unit franchisees to own or invest in franchise brands.
"If you're in franchising as a multi-unit franchisee and have built your enterprise by paying royalties, it's a very natural hedge to have an investment in an entity that's in the business of collecting royalties," says Aziz Hashim, founder and general partner of the new fund, called NRD Partners.
Hashim, who has made a career operating restaurant franchises, says he has been preparing for this new role all his franchising life. "I've entered and exited 14 brands in my career. So in a way I've been practicing as a little mini-private equity or fund anyway...

Feature Story:

Arizona Says No To Wage Discrimination »

Multi-Unit Franchisee

The state of Arizona stands with the IFA and has filed an amicus brief with the Ninth Circuit Court of Appeals in support of IFA's effort to halt discrimination against franchisees by the city of Seattle. Last year, Seattle approved an increase in the minimum wage that classifies franchisees as large corporations rather than the small, locally owned businesses that they are. The IFA says this artificial distinction that will force franchise businesses to boost their workers' wages faster than other small businesses.
In his brief, Arizona Solicitor General John R. Lopez, IV says that the Seattle ordinance is discriminatory and directly burdens 13 franchisors based in Arizona and their 54 franchise units operating in Seattle. The brief also asserts that the ordinance violates the U...

Feature Story:

IFA Says New Overtime Regulation "Unnecessarily Meddling" »

Multi-Unit Franchisee

The International Franchise Association (IFA) is condemning a proposed overtime regulation rule from the Department of Labor that it says would dramatically increase the threshold for overtime pay and ultimately force thousands of employers to shift the pay status of their workers from salaried to hourly.

"This change is likely to have the opposite of its intended effect and will clearly harm more workers than it helps," said IFA Executive Vice President of Government Relations & Public Policy Robert Cresanti. "Millions of salaried workers will now become hourly and lose out on key benefits such as workplace flexibility and long term advancement opportunities. This is just the latest example of the Obama Administration unnecessarily meddling in the everyday management of small businesses...

Feature Story:

Make It So!: Customer Growth Lessons From Amazon »

By Jack Mackey

Amazon founder Jeff Bezos is a Star Trek junkie. He almost named his company MakeItSo.com, based on the adventures of the USS Enterprise, when Captain Jean-Luc Picard would confirm his commands with the words, "Make it so!"
"Make it so!" may also be the ultimate personal motto for multi-unit operators trying to grow their businesses. But the practical question is, How exactly do you increase sales and business value continuously over many years?
What is the secret to Amazon's growth? Bezos answers like this: "We know customers like low prices. We know customers like big selection. We know that customers like fast delivery. And we know those things are going to be true 10 years from now. They are going to be true 20 years from now...

Feature Story:

Just Be-Cause: Cause Marketing Is Making A Difference »

By Kerry Pipes

Doing good is a longtime pursuit in America. You might even say it's a part of the culture. Americans love a good cause and like to help when they can. Whenever needs arise, there always seem to be businesses, organizations, and private citizens ready to come forward to lend a hand. And in the past couple of decades, businesses, especially franchises, have been getting more and more involved in supporting charitable causes.
It makes sense, both personally and for business. Franchises are local operations, most run by people who are part of the community. As a result, many franchise brands and tens of thousands of franchisees have become involved with good causes. Sometimes those causes are global, national or regional, but more often they are local and franchisees and franchisors alike are there to step in...

Feature Story:

IFA Opposes Damaging California Franchise Legislation »

Multi-Unit Franchisee

A bill making its way through the California State Assembly would undermine existing business contracts between franchisors and franchisees, says IFA President & CEO Steve Caldeira. The IFA opposes the bill and issued a statement saying Assembly Bill 525 would create untested new statutory language that will lead to costly litigation and hinder future franchise development for an industry that has outpaced overall economic growth for five years since the recession.
"In keeping with the spirit of Governor Brown's veto message last year on this matter, the International Franchise Association has been working in good faith with Assemblyman Holden (D-CA-41) to reach a consensus on a number of outstanding contractual issues between franchisees and franchisors...

Feature Story:

2015 AFDR Highlights: Website Mystery Shopping & Social Presence »

By Eddy Goldberg

This newsletter continues to present highlights from the 2015 Annual Franchise Development Report (AFDR). The 2015 AFDR is based on responses from 139 franchisors representing 36,313 units (32,693 franchised and 3,620 company-owned).

This week: website mystery shopping and social channel performance.

Process Peak conducted this portion of the mystery shopping, examining the websites of 147 franchise brands to evaluate how well they are using their online presence to grow their brand and manage their reputation.

Process Peak's Jon Carlston noted that franchisors are doing a "great job" of getting their websites to appear on Google's first search results page, but are not doing a great job using social channels as an additional way to promote their franchise opportunity...

Feature Story:

Multi-Unit Franchisee 'Strategies For Growth' Collection Available »

Multi-Unit Franchisee

Multi-unit franchisees who are looking to gain an edge on their competition have a new resource at their disposal. Franchise Update's Franchise Learning Academy has just released its "Strategies For Growth" Collection, a series of 14 video seminars, covering more than 20 hours of programming, and providing access to the insights, experience, and success stories of more than 40 multi-unit and multi-brand franchisees and franchising professionals.
The timely and topical information found on the videos comes straight from many of today's top multi-unit franchisees who have been there, done it, and successfully lived to tell the tale. Their invaluable advice can provide tips and insight for taking your business to the next level. All video seminars were produced at Franchise Update's Annual Multi-Unit Franchising Conferences in 2014 and 2015...

Feature Story:

Melting Pot Launches New Recruiting Incentive Program »

Multi-Unit Franchisee

The Melting Pot is looking to reopen some franchise locations and it has created a new incentive to help recruit qualified restaurant operators. The new program will provide financing to those who sign a franchise agreement to purchase an existing Melting Pot location in select markets across the country, starting with Chattanooga and Memphis.
Under the guidelines of its new "Path to Grow" program, approved restaurant operators can inject as little as 5 percent liquidity into the purchase of the restaurant to partner with the franchisor, who would provide the financing. In exchange, the franchisor would initially assume 51 percent ownership of the restaurant under the conditions that the operating franchisee agrees to pay back the initial loan within three years of signing the franchise agreement...

Feature Story:

Fresh CREAM Deal Coming To Florida »

Multi-Unit Franchisee

The cold rush is coming to Florida. The Sunshine State will be the location of more than 30 new shops of the San Francisco-based dessert franchise CREAM over the next 7 years. The franchise specializes in premium ice cream sandwiches and other frosty treats.
The new agreement marks CREAM's largest and most significant franchising announcement since launching its franchise opportunity in 2012, and will develop stores starting in South Florida before moving towards West Florida and beyond.
"There's definitely a lot of excitement around the brand," says CREAM president and COO Jim Ryan. "We are very excited to have over 30 units available to entrepreneurs in Florida and to make our East Coast debut."
The initial deal was inked with Armando Martinez Stone, who discovered the brand while participating in his High School DECA program in which participants were given the challenge to outline a plan to improve a company's national and international success...

Feature Story:

IFA Appeals To Stop Seattle's Discrimination Against Franchise Business Owners »

Multi-Unit Franchisee

Franchisees in Seattle have the International Franchise Association (IFA) on their side. The group is appealing a recent decision in federal court that allows the city of Seattle to discriminate against small franchised businesses as part of the city's 2014 minimum wage law. The IFA sought a preliminary injunction, which was denied by U.S. District Judge Richard A. Jones court in mid-March.
The IFA and five Seattle franchisees have given notice that they will appeal Judge Jones' decision to the United States Court of Appeals for the Ninth Circuit. The original lawsuit filed in June 2014 requested fair treatment for franchises under the law, which treats them as large, national companies, rather than the small, locally-owned businesses...


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Multi-Brand 50    

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Issue II, 2016

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2016 Multi-Unit Buyers Guide

Special Edition

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