Franchise metrics - What to measure

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Tips to become the top franchisee

If you’re hoping to imitate top performing franchisees and build yourself a profitable and sustainable franchise empire, you’ll need to ensure that you’re working in the most efficient way possible. Here, we take a look at which professional habits and personal qualities can help you rise to the top. Then, we look at what franchise metrics you can use to measure the franchise’s performance.

Tips to be a top franchisee

1. Routine

One of the critical attributes of any top performing franchisee is the ability to implement and stick to a routine. Successful franchises require order, and this order can only be established if there are regular processes and procedures in place. A well-organised franchisee will have many different routines, each spread over a different period. For instance, they'll have different daily, weekly and monthly routines, all of which are written down in an ordered ‘to do' list or timetable.

2. Targets

Targets are an excellent way to monitor progress and identify slipping standards. Employees at every level of the organisation's hierarchy should have their own targets, and the performance of the franchise unit itself should also be monitored and assessed via the use of targets. However, it’s also important to understand that targets are not gospel. Often, they don’t provide detailed enough information to offer insight into what is driving improvements or deteriorations in a business’ performance. Instead, they should be treated as alarm bells or an indication that something is not quite right and needs to be researched more thoroughly. A franchisee that takes target-related performance statistics entirely at face value is likely to miss the bigger picture or come to the wrong conclusions.

3. Thorough planning

The most profitable franchises are those that develop both short and long-term plans, then try to stick to them as much as is practically possible. Planning helps eliminate a significant amount of chance from business management and prevents people from making impulsive, on-the-spot decisions that contradict their long-term goals. It gives you something to work towards and ensures that your efforts are focused and purposeful.

4. Good work/life balance

No one wants to become a franchisee so that they can work all the time. Typically, the ultimate goal is to succeed in a business setting to facilitate a more comfortable and enjoyable personal life. We want to earn money to spend it on things we enjoy or the people we love. Of course, some individuals are driven by other motives, such as personal validation through success or a desire to change the world, but most franchisees are in the business to make money. All high performing franchisees make sure that they strive to strike a healthy work/life balance. Not only do we need to relax, recuperate and recharge to perform at our best, it's also important to recognise that we can't delay our own desires and personal gratification indefinitely; we have to enjoy ourselves in the moment too.

5. Regular contact with your management team

A successful franchisee surrounds themselves with other top performing professionals and ensures that they regularly communicate and listen to their advice. As a franchisee, your management team will be privy to information that you won’t necessarily receive. They’re one step closer to the action, more in tune with the day-to-day running of the franchise and able to offer a different perspective. This is incredibly important when it comes to ensuring that you’re fully informed on the latest developments in the business.

6. Regular ‘front line’ check-ins

As well as maintaining regular contact with those in the upper echelons of the franchise hierarchy, it’s important to understand what’s happening on the front lines. This means taking the time to schedule yourself regular in-store shifts. Working alongside your front-line employees helps ensure you understand the struggles and strains your workforce is under, while also allowing you to identify inefficiencies and problems more accurately.

6. Striving for improvement

All top performing franchisees are continually striving to improve their performance, breadth of knowledge and management skills. If they don't, their performance and abilities quickly stagnate and begin to decline. In the modern business environment, where the pace of change is astoundingly fast, any drop in determination and drive is punished by competitors who will leave you lagging behind.

7. Constant reassessment

The rapid pace of change in modern business also means that high flying franchisees also need to reassess their recent performance, goals and objectives regularly. As events in the industry and market can have drastic effects on your business, it's necessary to keep abreast of what's happening around you and adjust your operations, plans and targets accordingly.

8. An awareness of franchise weaknesses

As well as playing to your strengths as a franchisor, it's vital that you're aware of your shortcomings and actively strive to compensate for them. The same goes for the business as a whole. High performing franchisees are aware of the limitations of their franchise and work to improve its performance and minimise the influence of these weaknesses.

9. Know where you’re heading

Success is subjective. What one person considers an incredible achievement is just an everyday, routine accomplishment for another. To succeed on your terms, you need to know what your terms are. This means laying out your long-term goals and defining what success means to you. Do you want to build a global franchise empire? Do you want to build up a franchise unit, then organise a quick, profitable resale? Do you want to become a franchisor one day?


While top franchisees are all unique as individuals, they often share several essential characteristics. The 10 qualities and habitual behaviours listed above are some of the most common attributes that drive franchisee success. When considering how you can improve your performance, it's a good idea to try and take these tips and adapt them to your specific circumstances. For instance, not all franchisees will have a large management team to communicate with, but the general lesson can be applied to their supervisory team instead.

Franchise Metrics - What to Measure

When you’re running a franchise, you should want to check your progress and whether your business is heading in the direction you want it to. Key performance indicators (KPIs) are a type of performance measurement that enable a business to assess whether or not it is achieving its objectives and targets. The overall performance of the business tends to be measured by high-level KPIs, whereas low-level KPIs focus on the processes in smaller departments like marketing, sales, HR etc.

Take a look below at five KPIs you can measure if your overarching business goal is the growth of your franchise. This is predominately aimed at the franchisor, but much of it can be used by franchisees too.

1. Sales conversion

It’s a good idea to track the number of contacts you get against the number that become customers or franchisees, because this has a serious impact on profitability. If you’re getting contacts that aren’t turning into customers, then you might want to evaluate your sales team and how it’s operating. Alternatively, you might be attracting lots of interest from interested candidates but none of them end up becoming franchisees. This could indicate that your current strategy for advertising the franchise opportunity is not working effectively or enticing qualified candidates to find out more.

2. Net Promoter Score (NPS)

The NPS is a measurement that indicates how prepared customers are to recommend the franchise’s products or services to someone else. It therefore measures the customer’s overall satisfaction with their experience with the franchise and their loyalty to the brand.

According to Bain and Co, who introduced this metric, for the majority of industries, the NPS score accounts for 20 to 60 percent of a company’s organic growth rate. It has been found that, in general, the leader of an industry has an NPS score of more than double that of its competition.

If you can get enough responses from customers about their experience with the franchise, it’s a great way for franchisors to measure how their franchisees are performing.

3. Revenue per hour

This helps measure the efficiency and gross profit of your franchisees. It is worked out by the total revenue divided by the total hours worked by a single location, team or employee. The higher the revenue per hour, the better return on investment you will get.

4. System-wide revenue growth

This takes into account the sum of all of your franchisees’ revenue measured over a comparable period of time. An increase in this percentage is beneficial for both the franchisee and the franchisor because it means more money can be put back into the franchise and it increases the value of franchisee’s assets.

5. Labour costs

A main driver of franchisee profitability is wages and salaries. This often varies quite drastically between different franchise locations of the same brand. Keep an eye on the different labour costs of the different locations to see if you can make any improvements to benefit the franchisees and brand overall.

For a more detailed look into how franchisees can effectively monitor their performance, click here.

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