How to assess a franchise culture

It pays to be a bit fussy when choosing the people you’re going to spend a lot of your time with. That’s why if you’re looking to buy a franchise, it’s crucial pay close attention to their culture.

Here are five things to look for when assessing the health of a franchise culture.

 

1. Franchisees and franchisor staff are glad they joined

Ask franchisor staff what it’s like to work here. Listen carefully to their responses and watch their body language. Do their eyes light up as they give a simple and unreserved response? Or do they look a bit perplexed as they think of what to say, qualifying their comments with words like “it depends…” or “generally speaking…”

If the company does regular franchisee satisfaction surveys, (and most franchise networks with healthy cultures do), ask to see franchisee responses to two important questions.

“Based on your experience, would you recommend this franchise?”

“If you had your time over, would you buy this franchise again?”

You’re looking for a positive response by over 70% of franchisees.

Also ask whether any franchisor staff have left their job to buy a franchise? This is an indication of their confidence in the business model and the culture.

 

2. There is open sharing of information and data

Ask franchisor staff if you can see information on the performance of existing franchisees. In a healthy franchise culture, the franchisor will have access to accurate and up-to-date performance data on all franchisees, including detailed sales information, operating expenses and profits. And they will be happy to discuss this with you.

Also ask existing franchisees what sort of information they share between each other and how open people are in collaborating and sharing operational tips.

Finally, consider how open people have been in dealing with you.

 

3. People give each other the benefit of the doubt

Ask franchisor staff to tell you about how a recent initiative has been implemented. Listen to how this was done, paying attention to the level of transparency in the decision making process and the extent to which franchisees were involved.

Ask existing franchisees whether they think the franchisor team has their back and makes decisions with their legitimate interests in mind. In a healthy franchise culture people trust each other’s motives and assume they are acting honestly and reasonably.

Also consider how open and straightforward franchisor executives have been with you. Do you feel clear or confused after your meetings? Have they backed claims with facts, or are these based on hearsay? Have they delivered on their promises, or do they always have excuses?

 

4. There is deep engagement and understanding of the brand

While our culture reflects “how we do things around here”, our brand is our reputation. In other words, brand is what we want people to think about us and culture is what we are really like!

In a healthy franchise culture there is alignment between the brand and the culture. What you see is what you get. There is also a shared understanding throughout the organisation of what the brand stands for. This includes the staff of franchisees who are most likely to actually deliver the customer experience.

Ask people to tell you about the brand. Consider how clear and consistent they are in their responses. How enthusiastic are they when they talk about their products or services and how these are delivered? How proud are they of the brand?

 

5. Everyone is focused on the main game – creating happy customers

Many franchisor executives get so carried away with their brand, systems and achievements they forget the most important person in the world is the customer. Some even confuse their franchisees with their customers. There is only one customer and that is the person who chooses to shop with you.

In a healthy franchise culture, everyone – the CEO, the franchise sales manager, cleaners, franchisees and front-line staff – is regularly reminded that the organisation exists to create and maintain happy customers. Every decision is made through the filter, “Is this something our customers will appreciate?”

So ask them to tell you about their customers and listen to how closely they understand why their customers will continue to shop with this brand and not buy somewhere else.

 

Remember…

When you join a franchise network you are joining a culture which is likely to have a big impact on your thinking, behaviour and life satisfaction.

While we may not be able to choose our family, we can choose the groups to which we belong, so choose wisely.

 

This article was written by Greg Nathan CFE, Founder of the Franchise Relationships Institute (FRI), global leaders in the psychology of franchising. He is author of several bestselling franchising books, including Profitable Partnerships, and a popular keynote speaker at franchise conferences all over the world. For more information about Greg and FRI’s educational work go to www.franchiserelationships.com