Expanding Your Franchise: 6 Ways To Prepare For Change | Insights

Expanding Your Franchise: 6 Ways To Prepare For Change | Insights  

Is expansion in your future?

The restaurant business is fast-paced and so is the trend to grow and expand. Numerous owner/operators will experience change and growth by 2020. Technology is leading the way to elevate the customer experience and increase guest counts, along with modern store designs to set the stage. Change can be scary and invigorating all at the same time, but having a solid approach to transformation can make all the difference.

 

Here are 6 things to consider when growing as an owner/operator.

 

1. MAP OUT YOUR NEW ROLE

This will help set the tone and boundaries as your business expands. Effectively managing new locations yourself, especially ones not in close proximity, is difficult at best and may require your role to change. That’s why it’s important to outline any changes and communicate them to your team. This will strengthen your business and help your entire organization run seamlessly.

 

2. HIRE GOOD GENERAL MANAGERS

As you expand, you may need to hire more general managers to help with daily operations. Foster solid relationships with them and let them get to know each other. Individual stores need to operate independently, but can still rely on each other for guidance and assistance. Finding the right managers who can translate your requests and follow through on them should be high on your priority list before taking on additional locations.

 

3. IDENTIFY HUMAN RESOURCE (HR) GAPS

Knowledge of industry practices will be critical. This includes the issuance of employee handbooks, implementing employee training, and conveying company culture. Every state has its own set of employment laws, including workers’ compensation and background check restrictions. If you are considering expanding into another state, having a well versed HR person on your team could be beneficial.

 

4. RECOGNIZE TECHNOLOGICAL RISKS

New technology, including the use of mobile apps and kiosks, can present vulnerabilities for cybercrime and data breaches. Changes will continue to enhance the customer’s experience with an increased stress-free and personalized experience inside the restaurant, in the drive-thru, and on the go. Data thieves like the fact that franchise restaurants process countless credit cards daily and use extensive point-of-sale equipment. Wi-Fi and digital menu boards open up additional threats.

 

5. EMPHASIZE CUSTOMER SERVICE

Keep the service constant, even when complicated changes are happening internally. Your business may experience growing pains as it expands, but changes should never negatively impact the customer. They are the essence of your business and franchise success relies on providing a great experience. Additionally, while your franchise name is nationally recognized, stay in touch with the community your stores reside in by attending or supporting local events so customers get to know your business on a more personal level.

 

6. ADDRESS EXPOSURES THROUGH INSURANCE

Insurance specifically tailored for the unique risks your growing franchise will experience is a must. Marsh Operations Supervisor, Nick Hiveley, encourages owner/operators to include their insurance representative early in the purchasing or expansion process and offers a few tips as to why: 

 

  • Purchasing a new store is not purely a purchase of assets. You may also be purchasing the previous owner’s risk history which could impact policies, such as workers’ compensation, providing unfavorable rates in some cases.
  • Your insurance representative can help ensure proper coverage is activated on the new location and that certificates are issued to any lending partners in a timely fashion. 
  • A new ownership transition is when most employee grievances come to light (e.g. a disgruntled employee from the previous management or missed paychecks due to the transition of a payroll provider).
  • New owners coming in and releasing prior staff may cause terminated employees to file a grievance.

 

These are only a few items to consider, which is why it's so important to include your insurance representative early in the process to assist in uncovering any potential hurdles before you hit the ground running. The Marsh team can provide guidance on how to ensure that all appropriate steps are being taken to safeguard a seamless transition. 

Insights

The information contained in these articles provides only a general overview of subjects covered, is not intended to be taken as advice regarding any individual situation, and should not be relied upon as such. You should consult your insurance and legal advisors regarding specific coverage issues. All insurance coverage is subject to the terms, condition, and exclusions of the applicable insurance policies. Marsh cannot provide any assurance that insurance can be obtained for you or for any particular risk.