Best Practices

Network systems attackers, as well as less-dangerous (though still nefarious) hackers, never rest in their ongoing quest to compromise franchise computer systems and capture a share of the billion-dollar bounty of stolen credit card data. When the final 2010 figures are tallied, the FBI expects that organized crime worldwide will net more illicit money from Internet fraud than from illegal narcotics trafficking.

Attackers' methodologies continue to evolve and grow more sophisticated. Franchises must do likewise to stay a step ahead and protect customers' personal information and their own hard-earned business reputations, indeed their very livelihoods.

Some quick definitions: "Attackers" break into franchise computer systems with specific criminal intent to steal and defraud, whereas "hackers" often do so for the challenge, the notoriety, or the thrill of the chase...

To say the least, the past few years haven't been the best for business. We've weathered a brutal recession, and most of us aren't out of the woods yet. What's more, it's not only finances that have taken a hit--morale is suffering, too. In the battle for survival, many organizations have developed perpetually stressful atmospheres in which employees are asked to do more with less--often with little thanks. In many cases, it's not that employers want to shaft their people; they simply can't afford not to cut hours and positions, and they definitely don't have the funds for raises and bonuses.

Fortunately, says Todd Patkin, you don't need a single dime to make your people happy at work or to show them just how much you care about them and appreciate their efforts...

As we've seen in high-definition in the past few months--from the natural and man-made disasters in Japan, to the rolling upheavals across North Africa and the Middle East, to the volatile whipsaws in food and energy prices--the factors that must be accounted for while structuring financial affairs are much more complicated than ever before. Plus, the information is coming at us much more quickly, and the potential ramifications for our financial affairs are much more dire than in the "good old days."

The 1980s and 1990s were great times to be an investor. Interest rates were falling dramatically, instigating a huge and lasting bull market in fixed-income investments. Credit became easy to obtain and even our tax policies encouraged consumerism...

Power positioning is presenting yourself to the right person, at the right time and place, in the right way, with the right message. If you can do that all day long, every day, you will be an incredibly successful professional. This applies to most every profession - including multi-unit franchisee. We're always trying to sell something whether it's a product, a service, an image, you name it.

What separates the real pros from the amateurs is their ability to make whatever they are providing of vital importance to every prospect.

Such positioning is not something you can achieve quickly, or once for all time. It's a continuous process of discovering new ways to take charge of the way your clients and prospects see you...

Quality and price are two criteria for consumers when making a purchasing decision. So it is that most businesses compete by matching the quality and prices of their products and services.

What too many businesses fail to realize, however, is that there is a third criteria: customer service. How you treat your customers will determine whether or not they will continue to do business with you or turn to one of your competitors. If you reduce your prices, your competitors will copy you within hours. If you add a new product, they will do likewise. A service strategy—a focus on providing an exceptional customer experience—is the only strategy you can implement that will give you a 10-year lead over your competitors...

In my book, Overpromise and Overdeliver: The Secrets of Unshakable Customer Loyalty, I explain how to differentiate your brand by designing and delivering extraordinary customer experiences that instantly differentiate your company. This is achieved by understanding what I call "TouchPoints," that is, points of contact between your organization and your customers. These TouchPoints are divided into three categories: Product TouchPoints, Systems TouchPoints, and Human TouchPoints. I find most businesses put too much focus on one type of TouchPoint, which causes the customer experience to be "unbalanced" and therefore inconsistent.

Once you know how to create exceptional Product, Systems, and Human TouchPoints, next comes the most challenging and most fun part of the process...

In a perfect world, businesses would only be sold when they are healthy and attractive to buyers. Unfortunately, this is not always the case, and trying to market a business as an appealing acquisition while the business is in decline can be difficult. However, it's not impossible. Here are some strategies to utilize when selling a business in less than ideal circumstances.

Focus on the Positive
Concentrate on the strong points of your business when meeting with potential buyers. Even if your current financial situation is not what you would like it to be, think about other areas of the business that aren't distressed. Perhaps your business is established within its trade sector and is known throughout the community. That rapport and community presence is hard to achieve, and buyers should be aware of it...

The inspiration for Randy Elias's expansion into a new franchise concept came from a restaurant he'd been frequenting for years. In a prosperous area of Atlanta, a Mexican eatery called Jalisco sat next door to a Baskin-Robbins ice cream shop. With the help of customers looking for something sweet after a spicy meal, that Baskin-Robbins location was the number-one shop in that company, says Elias.

"Scott Paton, my business partner, and I saw the success with those two restaurants, and we modeled our business plan after that," says Elias. Good plan: today the two operate a very successful Moe's Southwest Grill in the Atlanta area, consistently coming in among the top 5 percent of the franchisor's 70 locations in the area. When a space opened up a few doors down from that restaurant, they decided it was time to expand...

Any experienced multi-unit operator understands that great employees ultimately need opportunities to grow and advance. These are your winners and you want to keep them - and you want to keep them engaged. One way to do this is to create a leadership path for those top-performing employees. There are numerous ways for franchise operators to approach this task. Many have successfully implemented concepts such as employee development programs and mentoring programs.

Earlier this year at the Multi-Unit Franchising Conference in Las Vegas a roundtable luncheon and discussion took place. Dozens of multi-unit operators with years of experience had the opportunity to discuss some of their own ways of grooming employees for leadership roles...

9 tools for nurturing a high performance team

Desi Williamson has led a diverse career as a corporate sales and marketing executive, entrepreneur, motivational coach for the Minnesota Vikings, and now restaurant owner. In 2010, he opened three Dickey's Barbecue restaurants in Minneapolis. Desi's Impact!! Restaurant Group, LLC is providing jobs for people in the community and planning to expand to ten locations in the next five years. His restaurants are topping the list of fastest-growing locations within the Dickey's franchise system and Williamson believes the most important factor in their success (and the success of any business) is their people.

Below are some of the keys that have allowed Williamson's franchises to grow in an environment that's supposedly the worst in decades to start a business, especially a restaurant:

Do your employees know what makes your company radically different from all of your competitors? Do they understand the specific critical role they play in creating customer experiences that are so unique customers can't stop talking about them? Do they know how to talk about your company's products and services in the most powerful way? Is your front line engaged?

If you want your customers to understand how great your company, your brand, your products and services are, your front line must be engaged with customers. What do I mean by customer engagement? I mean that every employee must understand what makes you different from your competitors, and they must know how to talk about that difference in a powerful way. They must know what words to use, what stories to tell and how to tell them...

Until your organization figures out how to drive higher sales and profits at existing stores, adding new units is very risky. The only time McDonald's got in real trouble came when they focused on growing sales by adding new units while neglecting to grow same store sales.

The source of sales--customers--can be a tricky, fickle bunch. They say they like the way you treated them and the service they received, but then they go across the street and spend their money with your competitors. If only franchisees could figure out how to transform customers who visit once or twice into customers who are loyal! Customers who return again and again are by far the most profitable.

Without an ever-increasing stream of loyal regulars, franchisees find themselves anxiously looking at the franchisor's marketing calendar as the answer to generating the traffic needed to survive...

In the course of my speaking and consulting engagements, I've found that many franchisees have given up even trying to get meaningful references on promising job applicants. From the frustrating experiences recounted to me by others and my own company's policy, I know that most employers will report only dates of employment and the starting and ending wage or salary figures.

The information clampdown is the understandable, but misguided, response to the number of lawsuits filed--and won--by former employees who went to court to dispute what they believed were unfair, unfavorable references.

To complicate matters, the turbulent economy has made it possible for dishonest people to list defunct companies as former employers, as well as to create a job title and range of responsibilities that lead you to believe you've found just the person you've been looking for...

Timing Is Everything

Timing the sale of a business can be a stressful process. In today's tenuous economy, it's nearly impossible to predict your business's financial future, let alone its value on the open market. But smart business owners also know that timing is everything. Selling either too early or too late can lead to a substantial amount of money being left on the table. So while you won't be able to control the economy, there are certain steps you can take to make sure the timing of your sale maximizes the selling price.

Being ready to sell when that time comes can lead to more interest from buyers, more offers and ultimately, a higher selling price. So whether you are looking to sell soon or farther down the line, here are some considerations on which you should focus...

Service Recovery

Service recovery. Those two words can make the difference between success and failure. And yet most people in management positions don't know what the term means, let alone how to use service recovery to establish a loyal customer base and increase sales. 

Let me give you two examples of customers who had a problem with a business. Mary meets a friend for dinner at ABC Restaurant; a few blocks away, Frank is dining with a coworker at XYZ Restaurant. Mary had made a reservation for 7 p.m. and waited for 45 minutes before being seated. Down the street, Frank's steak was under-cooked and was sent back to the kitchen. 

When Mary complained about the long wait for a table, the hostess simply said, "We're very busy tonight" and went on her way...

Building a Winning Team

Some two decades into the pizza business with Domino's Pizza, Dave Melton has acquired quite a bit of knowledge when it comes to building a great team around him. The multi-unit franchisee, who has 4 units in Manhattan and 2 in nearby Connecticut, loves to use sports metaphors when he talks about building a great team. Here - from his book Hire the American Dream - are 12 strategies that have worked for him over the years. If you don't already do these things then you might give them a try.

Get to know your teammates
The more you understand about a person, the easier it is to accept his differences. It's easy to be critical and negative about a person you don't understand. Take time and listen to the person with whom you're having trouble...

Management Best Practices

Basic business fundamentals teach that organizations won't experience much prolonged success without strong leadership and management in place. It really does start at the top. Good managers understand that there are certain strategies and techniques that help create a positive working environment for their entire team. Of course the end result of this kind of management is a healthy business with satisfied customers.

Multi-unit franchise operators know that past a few units, they need help overseeing the empire. Unit and area managers often bridge the gap between the day-to-day operations and the franchise operator. They're the eyes and ears on the ground and in the stores. What they see, manage, and report back can be imperative to the ongoing success of the company...

"How am I doing?"
That's a great question! In fact, none of us can get better without knowing how we are doing in key performance areas. For multi-unit franchisees, who are "managers of managers," it is crucial to focus your teams on the vital few things that matter most and are under the control of your managers. Reporting these key metrics gets people to pay attention to what's important. Done correctly, measurements answer the question for each store manager: "How am I doing?"

Measurement is more than information
An inspiring example comes from Broadbase, Inc., which operates 34 locations and was named "Operator of the Year" at the 2010 Jiffy Lube International franchise convention. Broadbase CEO Don Fowler says his company's remarkable sales growth, from $12 million to $31 million over the past three years, comes in part from highly motivating performance reporting systems...

If I were to ask 100 business operators to define customer service, I would guess that 97 of them would say this: Customer service is providing the customer with service that is fast, accurate, and courteous. While those are indeed elements of customer service, there is more to it, so much more.

Customer service is a moving target; it is whatever the customer thinks it is. That includes quality products, convenience, competitive prices, timely responses, reliability, a personal touch, and knowledgeable employees. Customer service means doing what you say you will do and doing it when, if not before, you say you will do it. It is operating on the belief that no transaction is complete unless the service customers receive is sufficient enough to motivate them to return...

If you have a telephone at any of your franchise locations, you are most likely being overcharged. If you have trash service at any of your franchise locations, you are probably paying more than you have to. If you pay for worker's compensation at any of your franchise locations, there are almost assuredly errors in the way your coverage was categorized. To put it more simply, if you have walls, doors, workers, and customers, the monthly bills you're getting are probably too high.

Recurring monthly expenses like phone, Internet, trash, and alarm services can be a wasteland of, well, waste...especially for owners of multiple franchise units. Multiple locations spread over even one metropolitan area most likely means separate service bills and contracts for each service at each location...