As you know, it’s a competitive market for franchisees. And not just for their industry-specific operations, but with internal corporate competition for resources and attention.
Franchisees know that they have a higher likelihood of failing if they are poorly managed and neglected by their franchisor – which is not only bad for the franchisee, but for the overall brand in a market.
That’s why it’s vital for franchisor leadership to take a hard, close look at the way they determine both corporate territories and their franchisee regions to minimize cannibalization.
In order to do this, corporate franchise leadership needs to make objective, data-driven decisions when it comes to franchise territory determination.
Franchise territories should be granted only after an in-depth, multi-dimensional analysis has been conducted to make sure that the tiger that is each franchisee doesn’t eat its young – because at the end of the day, it’s too risky to assume that each franchisee will objectively assess and operate within their market’s trade areas.
But more than just combating cannibalization and managing territories, it’s vital that franchisors know who their customers are, so they can determine market optimization and not have to face the dangers of under-serving a particular trade area.
Brand ownership needs to have a solution designed not only to identify today’s customers, but tomorrow’s and 2015’s customers as well.
Data-driven solutions offer analyses without bias so that franchise leadership can make more strategic, yet objective decisions across the board by leveraging a universal foundation that’s rooted in understanding customer data – regardless if the customer lives in small town USA or metropolitan Canada.
The Bottom Line:
Customers are the life-blood of every business concept you can imagine. Franchisors who truly know their customers, who understand their lifestyles and behavior patters, have a distinct advantage over those who do not. Help your franchisees start on the road to success by giving them the tools, information and attention they need.
Buxton will be attending the upcoming 2014 International Franchise Association Annual Convention at the New Orleans Convention Center. While you're there, talk with one of our franchise experts about how using analytics can optimize franchise territories and grow your business.