Planning for the new year – A checklist for franchises
It’s another new year and with that in mind, it’s a good time to get make sure your franchise is in good working order for the year ahead.
Here’s a checklist of items to put you in good stead for 2019:
Review and reflect
If you haven’t already, take the time to look back on the previous 12-months and reflect – what went well? What could have worked better? Use these reflections at each stage of your checklist to refine what you are doing.
Your franchisees may have a very different view of what was successful and what was challenging. Be sure to include feedback from all franchisees, including those who exited in 2018. Consultation with your franchisees is also a good way to strengthen your working relationship.
You should check your documentation including your franchising agreements and disclosure agreements to ensure that they accurately reflect the nature of your business as it is now. It is wise to obtain external advice for these documents so that any changes you make are legally above board. Paperwork that puts your franchisees at a disadvantage when it comes to running a successful business is not only not in the best interests of your franchise, it can incur large penalties from the courts. Your lawyer will also be able to adjust your paperwork to cater for any legislative changes that have occurred in franchising and any other sectors your business operates in.
Making sure your franchisees and staff know what to do is critical. Are there common problems occurring that you can rectify with training? Your training program and collateral may have worked in the past but that doesn’t mean it won’t benefit from refinement.
There have been a few changes made to penalty rates and casual pay of late. Make sure that your franchise is paying every employee correctly.
Have you taken the necessary steps to ensure your intellectual property remains yours exclusively? When it comes to protecting your brand, most people think about logos but it’s also any goods or services you offer that differ from others. Think KFC’s recipe for 11 herbs and spices – not the kind of thing that you want a franchisee copying before leaving and setting up in direct competition.
The start of the year is a good time to plan a refresh if required – whether it be a complete branding overall or some subtle tweaks to some of your marketing materials. You should also look at what campaigns you’re hoping to run throughout the year in regards to what they’ll look like and what you hope to achieve.
Is your business financially sustainable? Get your accountant to look over your financials and provide details of any big projects you’d like to tackle. As we’ve seen in the recent case of Max Brenner winding up in administration after overextending on its head office refurbishment, getting expert advice in this area can place you in a much better position for the year ahead.
When was the last time you checked what your competitors are up to? Are some of your franchisees struggling with fierce local competition? You may need to look at revising your business model or some of your offerings in order to remain appealing to your customers. Providing additional support to franchisees experiencing strong competition may also be required.
Identify dead wood
Are some of your franchisees consistently underperforming? If so, give notice and undertake an audit to identify why the problem is occurring and how it can be addressed. You can read more about undertaking an audit here.
Plan where you want your franchise to go
Your franchise may be ticking along well now but where do you want it to go? Do you have a strategy in place for further growth? Perhaps you’d like to expand across Australia or even internationally. Decide what you want success to look like for your business in 2019 and map out a strategy. Check in with your lawyer and accountant to see if it’s feasible and what practical steps you need to take from a legal and financial viewpoint.
For more information on how to check that your franchise is in good shape for the year ahead, please contact Racha Abboud.