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News and stories about managing, leading and operating a franchise

Individual Medical Coverage Surprise for Franchises

Group coverage too pricey for your franchise? For years the International Franchise Association has actively lobbied on small-business health plans, formerly known as association health plans to lower prices for its franchise members. That would be a nice bonus if they are successful but individual policies are now better than you think.

"Bryan Barnall has long prided himself on providing health insurance for the four employees of Printing Plus, his Lincoln (Neb.) commercial printer. Then his carrier upped his premiums by 50% two years in a row, and Barnall had to dump his group plan. But he didn't leave his employees in the lurch."

"Barnall's workers now buy individual policies through his agent. Each pays $50 a month toward premiums; Barnall pays the rest and gives each employee $75 a month to put into a health savings account (HSA). Barnall deducts his entire outlay from his taxes. And he has cut the annual health-care costs for his $350,000 company in half, to about $12,000. "The change initially made my employees a bit nervous, but they're all happy now," says Barnall."

Your main asset – your own time

As a franchisee, the scarcest and most important asset is your time. You have to get the most out of each day if you are to be successful.

  • Plan the use of time – use your diary positively. Use a ‘to do’ list. Mark in the diary time when you are ‘available’ to see others and time when, except in the direst emergency, you not.
  • Set goals – if you do not know where you are going, you are going to waste a lot of time travelling down the wrong roads.
  • Establish priorities for what you do - do not confuse the urgent with the important. Do not allow the important to be chased out by the urgent.
  • Do not waste your own time – do not flit from one job to another or burn valuable time in unnecessary socialising or phone calls. The cell phone is not your friend!
  • Do not indulge in ‘busy work’ – do not use action to replace thinking!
  • Do not wrap your self in paper – paperwork is like treading water, it uses up a lot of energy but it does move you forward. Most of the paperwork and emails you receive only need to be read, deleted or thrown away. Take action where it is required - and do it fast. If you are spending two hours a day on paper or emails, you are probably wasting an hour and a half.
  • If you have staff, use them – if you do not delegate to them, you are a fool. If you cannot delegate to them, why are you employing them?
  • Systems and procedures – establish routines and procedures for everything that is routine.
  • Regular problems – if it keeps going wrong, find out why and stop it!

You are not Superman or Superwoman and being busy is not the hallmark of a good manager. It is usually a very good indicator that you are badly organized.

Difference Between Yellow Pages and Other Media

This time, continuing from my last blog entry, we'll consider the difference in advertising between yellow pages and other media (newspapers, radio, magazines, mailouts, etc.)

With most media, an ad represents a seller looking for a buyer. In contrast, yellow pages are used by buyers looking for sellers. People subscribe to a newspaper to keep up with the news. They listen to the radio to pass the time when they're driving, to wake up in the morning, etc. Should, in this process, they see or hear an ad that motivates them to buy, that is incidental to their main purpose in using these media.

Taking Control of Your Future – the Business Plan

The franchisee who has no thought out plan for the future of the business is likely to be a franchisee whose business has no future.

  • What is your Vision of where you see your business in, say, five years time? Your dream? If you do not know where you want to be, you surely will not get there.
  • Set a Mission that has specific targets you need to achieve on the way to achieving your Vision. The steps along the way. The path that you will take.
  • For the coming financial year you have to have sets of Key Objectives.These should be set in prime areas such as:
    • Finance – profits, return on capital and so on.
    • Customer satisfaction - % of customers rating your products and services as ‘Excellent’
    • Processes – the chains of activities you need to undertake to keep your customers happy and, therefore, your business profitable. You want objectives here that will drive down your costs of operation and speed up your service delivery.
  • Make a truly objective assessment of your business and those working in it. You want to be sure of your strengths. But more important, be aware of your weaknesses before somebody else discovers and exploits them.
  • What do you offer – your products and services? Who do you offer it to – the age groups, income groups and geographical area you cover? What is the competition?
  • Summarize your Strengths and your Weaknesses. Identify the opportunities out there in the marketplace for you to exploit your Strengths. Pinpoint your weaknesses and how you can stop others from exploiting them.
  • How you are going to promote your products and services to your target customers? Are you going to offer the same products and services to all groups, at the same price and promote them in the same way?
  • Prepare an Action Plan –exactly what you are going to do? When you are going to do it?

Plans have to be flexible. The world will not adjust itself to you. You have to adjust to the world. But you will be in a better position to do this if you have gained the real understanding of your business and your market that undertaking this activity demands.

Stop Talking and Sell!

The Sales Process“There are worse things in life than death. Have you ever spent an evening with an insurance salesman?” -- Woody Allen

I have designed, facilitated and delivered sales training in Fortune 500 companies and many small business enterprises for many years. In the old days and in the worst places, a salesperson would use whatever tool in his bag of tricks to get the customer to buy – cajoling, pressuring, and exaggerating. Remember those endless sales pitches that went on for hours and hours, without you even saying a single peep to acknowledge any interest? You know -- the insurance or used car salesman approach that most of us dreaded. Woody Allen was quite right. There are fewer things worse than a sales person gone amuck.

Getting Your Business Known With Minimal Advertising

“The fish has to see the meal before it bites.” – Chinese proverb

Before selling, franchise units that are involved in business to business selling need to market and mine their business contacts to get noticed. For small businesses, this does NOT mean spending thousands upon thousands of dollars in bad advertising – dollars spent that do not reach and do not bring in new customers. Don't get me wrong. Advertising is important but I've seen new business owners, who seem to think that building a business is just a matter of how much one puts into advertising. They dump unnecessary amounts of money into ads, a very costly mistake that can lead to bankruptcy.

Employee Recognition Gone Awry

A pizza manager cooked up a scheme that went awry, motivated by wanting her name in the company newsletter. Yes, I said that right -- by a mention of her name, Kimberly Hericks, in the Donato's Pizza newsletter for increasing pizza sales. She received no compensation for the sale of the pizzas.

Ms. Hericks sold roughly 400 pizzas to fake company accounts, schools and hospitals, then covered it up by delivering the pizzas herself to "maintain a rapport with the customers". That might've raised a few eyebrows but the manager managed to assuage any suspicions by sending herself a bouquet of flowers in thanks for her services. She signed a fake thank-you note from her bogus Lakewood Hospital customer. One would hope that at least the thank you notice gushed with how wonderful this manager's sales skills were and suggest that she receive a raise or a promotion immediately.

Unfortunately for her, the store manager was discovered when her boss helped her move. He discovered 400 rotting pizzas in her garage. Yuck!

And the damage done to the company? Besides the $3000 owed in pizzas, which she tried to compensate her boss through a bounced check, a company audit shows that there is now $38,000 not accounted for. Uh-oh. The company's computer system was also damaged when Ms. Hericks tried to manipulate the accounts to cover up her deceit. She was indicted on charges of theft, forgery, vandalism and passing bad check, and faces a maximum of five years in prison if convicted.

Fortunately for Donato's Pizza, she was caught. Smart talent is hard to find and mistakes, big ones, were made in perpetrating such a crime. It seems that the most innocent of employee incentives and recognition can be abused or motivate in the wrong way.

Sources: Wiggins & Dana's Franchise Law Blog and Court TV's Stupid Crimes and Misdemeanors

Church and Franchise at Christmas

It seems the battle between church and franchise rages in the South. A Raleigh, McDonald's restaurant has written a religious message for the season on its sign.

The sign reads, "Merry Christmas. Jesus is the reason for the season."

One local woman thinks it is offensive to her Jewish views and has asked the company to take the sign down. However, the majority of the community does not seem to mind. The store manager said that church groups were frequenting the restaurant and others were being drawn in by the sign.

Lessons on how franchisees adapt to quick change

Quick printing has changed in the last 30 years. Here is a good summary from an Austin shop owner on the changes and the increasing difficulty of being a small quick-print shop. First, adapting to rapid technology change is critical - being leading edge but not bleeding edge. In one story, an Alphagraphics owner speaks about how upgrading equipment helped turn around profits. Do it the wrong way or too much and you bleed profits.

Second, the Austin shop followed equipment upgrades by pro-actively training its customers on technology changes that make their life simpler.

"There has been a complete turnover of equipment and processes in the last 10 years," says Meyers, who started the 25-employee company with a $10,000 bank loan while he was a student at the University of Texas. "We had to completely revamp our equipment and personnel for the digital era."

Yellow Pages: What You Don't Know Can Cost Big Bucks

SamB is not my real name. I'm writing under a pseudonym because it gives me the freedom to tell you like it is.

I'm an account executive for the leading yellow page directory in a large city. Although I'm not a franchisee, I meet quite a few of them in the course of my work. Many of my good friends and relatives are businessmen and women, a couple of them with franchises. Writing is my hobby and this blog is my opportunity to contribute while doing something that I enjoy.