Why Franchise Leadership Is More Important Than Ever Amid COVID-19

How franchisors can help lead their teams through this unprecedented crisis.

The franchise industry is undoubtedly facing a situation unlike anything it has seen before. The COVID-19 crisis has caused brands across nearly every industry to temporarily close their doors or rethink their operations, putting franchisors in a position where they need to act fast in order to provide the necessary support. Now more than ever, franchisors must show true leadership for their franchisees and team members so that they can respond, recover and thrive.

Communication is Key

While no one knows how or when the global economy will bounce back from the fallout following the Coronavirus crisis, businesses and franchises can all agree that communication is essential.

In order to ensure that franchisees are confident in the plan and future of the company, franchisors need to communicate effectively and provide ongoing support when it comes to operations, procedures, best practices, reopening plans and more. By creating an open dialogue with franchisees, leadership teams can better answer any and all questions and offer concrete solutions based on the health standards set by the CDC.

To achieve this, many franchisors are rolling out new initiatives to enhance the level of communication throughout their network. In addition to the usual franchise support, brands are adding more conference calls, webinars and regular video town hall meetings as well as more frequent one-on-one conversations to keep franchisees in the loop. Since the situation is changing rapidly, especially as certain states start to reopen, franchisees need to receive up-to-date information on available resources, whether it is financing options, the SBA CARES Act which includes the PPP and other loans, vendor partnerships or potential rent deferment.

In addition, some franchisors have set up a designated franchise advisory task force just to discuss issues related to COVID-19 for their brand. Historically, groups of franchisees have served as a resource for brands, as well as a voice for owners within the system to ensure that their ideas, suggestions and concerns are heard. Forums like these are essential for franchisors, especially during the current crisis.

Adapting Business Models

As franchise brands across every industry look for ways to adapt to the changing landscape, franchisors and franchisees must work together to pivot their business models. Whether it is rolling out virtual workouts, limiting occupancy in a retail location, or implementing curbside pickup, brands need to help franchisees update their value proposition to appeal to the changing needs of the consumer in today’s environment. 

Although franchisees may have insights into their local communities, it is the franchisor’s role to research the industry as a whole and keep track of the changing standards. While franchisors always establish the brand’s guidelines, many are having to adapt in ways they never imagined. As brands enter these uncharted waters, leadership teams can utilize the resources of associations such as the IFA – International Franchise Association  or National Restaurant Association to research best practices, loan options, health information and more. Industry experts are hosting webinars and developing tools to help franchisors understand the changes that need to be made in their particular sector so they can better guide franchisees.

These types of changes require a lot of communication between franchisors and their franchisees. Leadership teams should be training franchisees on new strategies to engage customers while some of their local brick-and-mortar locations might be closed, such as new marketing campaigns, digital offerings and social media messaging. During this transformational period in business, reevaluating the underlying value proposition of a brand will inspire teams, franchisees, prospects and customers. Ultimately, this will allow businesses to better reevaluate their brand messaging and core values, putting them in a better position to succeed on the other side of this crisis.

Planning for the Future

As challenging as these times are, it is important that franchisors recognize that we will make it through this. In addition to coaching franchisees through the current situation, it’s also important for franchise brands to be prepared for the “new normal” of the future. That means speaking with franchisees about how they’re going to ramp back up once consumers are spending again. Many teams are halting advertising and marketing altogether to preserve cash flow while some are staying the course in an effort to keep momentum. Even if active advertising needs to be pulled back a bit, brands should adjust the sales messaging to align with a more empathetic mindset.

In terms of the lead generation funnel, franchisors will want to be positioned positively coming out of this crisis. Millions of people are home right now, reevaluating their current job and researching other opportunities for the future. This pandemic and the recovery process that will follow it represent an opportunity for franchise brands to engage in meaningful communications at all stages of the discovery process. Smart franchisors will take the time to engage in more significant conversations focused on existing franchisee validation, providing support during this time of crisis, and, most importantly, participate in honest conversations about who is and who is not a strong fit for their franchise system. To do this, many franchisors are holding virtual Discovery Days to ensure that candidates stay engaged in the process during this difficult time.

Right now, strong leadership is about spreading positivity, showing compassion and preparing teams for the future. Franchising has been an important industry in prior economic downturns, and franchisors need to communicate with franchisees and other stakeholders, pivot their business model and develop reopening strategies in order to lead franchisees to success.