Effective System Change

Franchise systems must stay dynamic, not static. Reduced recessionary spending demands introduction of new product assortments and pricing programs. Decreases in franchisees' financial performance mandates a product line adjustment. Whether driven by external or internal forces, every franchise system must be prepared to adapt to remain relevant, viable, and competitive.

Once a franchisor determines that change is necessary, it faces the challenge of implementing that change throughout the system. How it approaches such change could determine whether the franchisor wins or loses that challenge.

Following these tips will hopefully improve a franchisor's success in implementing a change throughout its system. However, even a franchisor that has perfectly planned the implementation of a change will likely have hold-out franchisees who refuse to adopt it. At some point, a franchisor must take steps to address these hold-outs. Simply sitting back and allowing these franchisees to refuse implementation sends the wrong message and negatively affects the franchise system and the franchisor.

Amy Cheng combines her corporate and franchise experience to provide start-up and seasoned franchisors with comprehensive legal services to expand their systems. She is a member of the IFA's Women's Franchise Committee and is a Topic and Article Editor for the ABA's Franchise Law Journal. She also is an instructor in the "Franchise Mini MBA" program at the H. Wayne Huizenga School of Business and Entrepreneurship. Before forming Cheng Cohen, she was a partner with DLA Piper US. Contact her at amy.cheng@chengcohen.com or 312-243-1716.

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