How To Assist Franchisees Undergoing Financial Stress • The economy is cyclical; this has occurred before • Focus is key • Motivation and inspiration: we all need it *Franchisees’ enemies are busy-ness, distractions and denial
How to Assist Franchisees Undergoing Financial Stress Crafting the message to franchisees *A multi-touch, multi-channel communications and action plan -one-on-one coaching -group coaching (in the field, online or both) -newsletters, intranet, all staff, all messaging and communication *Help franchisees create a focused, proactive plan to implement; help them adjust the plan as needed *Accountability is key
“What’s Important Now” (WIN) • Manage cash and expenses; get financial house in order • Step up (or at least maintain) marketing and outside sales • Customer retention and customer development is critical • Train and Develop staff • Inform and involve staff
Manage Cash and Expenses; get financial house in order • Create a short term cash budget • Think big and think small in areas of cost control • Keep in conversation with your banker • Line up a back-up bank • Focus on collecting receivables • Eliminate poor (and average) performing staff; • look to upgrade
Step up (or at least maintain) marketing and outside sales Study after study shows Companies that maintain their advertising and marketing emerge from a downturn ahead of the competition
When competitors reduce their advertising and marketing, by maintaining yours you get increased exposure; your marketing message has a better opportunity to get through • Contact past clients • Consider referral programs and incentives
During tough times, it is even more critical to get new leads and new customers • What customers and prospects look for during tough times may be different than in • good times; modify your offering as appropriate • Consider money saving coupons, promotions, etc. • Customer Retention and Customer Development is Critical
A Little Background Perspective…My Journey Serial Entrepreneur Operator Business Developer Franchisee Franchisor
Why Shoney’s? Strong Brand Name Rich History Good “Bones” Experience with Underdogs Right Time/Right Place/Right Position Bruised and bleeding, but not broken
Going the Distance There is no substitute for hard work There will be casualties along the way When in the line of fire, stay focused on your goal Know when to turn it up a notch
CSFs: Commitment Can Make All the Difference Get in 100%...99-1/2 just won’t do Move quickly to do what is required Make decisions based on the good of the System Establish which relationships are vital and protect them Promote bold goals for yourself and your franchise System Run a lean corporate office
Takeaways Determine what must be done and stay focused Move quickly Visit your business (or units?) Make decisions Accept key casualties Be bold (but deliberate) Run a lean operation and surround yourself with winners
Harvey H.H. Homsey Vice President Franchise Systems, Express Employment Professionals
Rolling Out New CampaignsDuring Recessionary TimesTo Roll or Not to Roll…That is Your Question
Product/Service vs. TalkWhat is Your Product/Service? Review your current product/service What do clients/prospects really looking for during recessionary times? Needs vs. Wants The Client’s Needs vs. Your Wants Your offering in “good” times may be different than what you offer in recessionary times
What Do Clients NOT Want? Put yourself in your clients/prospects shoes Funds and Budgets Do you want a gimmick or something you can “really” use? Stuff vs. service What campaign would you want? Show me the “money” The best campaign during recessionary times may be the one you “don’t offer”
What Do We Offer In “Good Times” Your product/service What is it? What do you stand behind/guarantee? 100% What is your “support system”? Are you “there”? What is the competition?
Why Would “Service” Ever Change? Who do you “buy from”? Clients do the same Who do you trust? Do your clients trust you? Are they loyal to you? Are they loyal to the solution you say you offer? What matters to you? Clients have the same needs Don’t ever stop servicing!
It’s All About…Selling and Servicing Basic, good ole, customer service Be where you are needed Be there always Your competition will stop selling/servicing You better not ever stop What matters to your clients? Don’t ever stop selling or servicing!
What Do You Offer……In Recessionary Times? Selling Don’t stop Servicing Make it better! Being where you are needed Always! Your BEST product/service EVER YOU!
Know Before You Roll… Review your product/service Remember what clients “don’t” want Compare your “good” and “recessionary” offerings Don’t change your service Don’t stop selling
The Best? The best campaign to “roll” is YOU
Key priorities Build formal & informal communications Monitor key metrics Establish expectations Maintain discipline & urgency
Communications Frequent dialog with key players (before a crisis) Habit of open, frank discussion Relative and absolute performance Successes and failures
Establish expectations • Create & follow issue resolution process • Clear • Consistent • Transparent • Set & explain boundaries • Clarify hierarchy • Manage investor expectations
Discipline & urgency • Don’t relax standards • Build balance sheets • Relentlessly improve unit FCF, ROIC • Hope for best, prepare for worst