I was telling you in my last article about the role of ‘uncomfortable conversations’ in franchising success…
Being an uncomfortable friend also involves knowing when it’s time for the franchise partner to quit. This can be especially difficult if they’ve invested significant effort and resources!
Still, there will be times when a franchise partner is throwing good money after bad. As an ethical and responsible franchisor, you don’t want to continue taking money from people who are not making progress. They might be in a contract for five to ten years, but if the individual is either not capable or unwilling to make the necessary changes, exiting might be the best option.
So, you need an offboarding process as well as an onboarding process. With all your franchise partners, some will rise to the top, while others may not match your values and purpose. It’s important to have systems to onboard new partners and also allow those who aren’t a good fit to exit gracefully.
Effective coaching with compassion can create a positive exit management strategy. However, this decision to exit must come from the franchise partner themselves. Otherwise, you’ll find yourself in an energy-sapping blame game.
You don’t want to jump to the exit plan too quickly, as there may be a chance to work things out. However, the point is to have a process in place for people who really need it.
In a resonant relationship, you never push people to do what you think they should do. Coaching with compassion involves helping the individual see if they are a square peg in a round hole. They need to come to their own understanding if they’ve made a mistake, or if their success lies elsewhere. You can’t force them to that conclusion!
For example, my own success in franchising has hinged on building great teams around me. If I’m in a situation where I have to do everything, then I’m not playing to my strengths. In a business where I’m on my own, I need to build a team or outsource tasks.
Franchisors are there to support but not do everything. A franchise partner still needs to handle their responsibilities!
Set Clear Expectations
When you’re in the position to be someone’s uncomfortable friend, you must be clear about their responsibilities. It’s necessary to be black and white about these things because people often hear what they want to hear after the fact.
For example, if a franchise agreement states that marketing support is provided, franchise partners might assume all their marketing will be done for them. In reality, while there might be collateral, a website, and other resources, the franchise partner needs to use these tools effectively to generate leads and clients!
To become the ‘uncomfortable friend’, you must set clear expectations around this during the onboarding process. Set clear expectations from the start. Make sure franchise partners understand their responsibilities and the support they’ll receive. This approach helps prevent misunderstandings and ensures everyone is on the same page.
Setting expectations is like pouring cement into a mould. Once the cement hardens, it’s difficult to reshape later on. The initial onboarding stage is your one chance to set the foundation for the franchise partner’s understanding and expectations.
If expectations aren’t clearly established, franchise support can be perceived as performance management in an employer-employee dynamic – which in a franchise setting always causes friction. Franchise partners might feel they are being managed solely for the franchisor’s benefit, even if that’s not the case. This perception can create a negative emotional response, making the franchise partner feel undervalued and mistrusted.
Applying the 80/20 Principle
According to Pareto’s 80/20 rule, you’ll spend 80% of your time on the 20% of franchise partners who cause you the biggest problems. Some of these franchise partners will be square pegs in round holes. If that’s the case, you need to identify this as early as possible, but encourage the franchise partner to come to this assessment on their own.
However, the success stories where individuals turn things around after these uncomfortable conversations, make all the discomfort worthwhile. It’s incredibly rewarding to see someone facing significant challenges take responsibility and succeed.
The stakes in franchising are high. Financial freedom is often at stake. A positive transformation can be nothing short of life-changing.
The outcomes of an ongoing uncomfortable conversation will either be:
- Significant change on the part of the franchise partner
- A successful and amicable exit from the franchise.
If you aren’t arriving at one of those outcomes, then a disgruntled franchise partner will simply become more and more disgruntled. It’s much better to be proactive than to ignore the issue, so franchise support teams need to be trained to deliver these difficult conversations.
I’m currently working with a franchisor dealing with an internal dispute between business partners. Instead of opting for expensive legal mediation, I’m using coaching with compassion to mediate and help them achieve clarity. We’ve created a safe psychological environment that has, for the first time, allowed all parties to express their concerns and agree on guiding principles.
My role is to make all parties recognise that blaming the other party is unproductive. Blaming each other for past mistakes will not help.
In any negotiation or mediation, you can’t ignore the facts. However, you have to drop your guard enough to let the conversations happen that need to happen. Once you achieve clarity and agreement, it can be staggering how quickly you move forwards towards a solution.
The key is to maintain a solution-focused, forward-thinking approach that aligns with the hopes and dreams of the franchise partner. Everyone gets into a franchise arrangement with hopes for the future. These aspirations can diminish as they face challenge after challenge, leading to a sense of impossibility.
When people are overwhelmed by what has gone wrong, including their own mistakes, they often don’t want to admit these failures. (Even to family members, let alone you as the franchisor!) Admitting they are facing a crisis and that it’s their fault is hard for most franchise partners. It is easier to find reasons outside of themselves, but this doesn’t move the situation forward and usually makes things worse.
Focusing on solutions and future possibilities can rekindle those initial hopes and dreams. This process involves acknowledging past mistakes and challenges but not dwelling on them. Instead, it is about using them as a learning experience and a stepping stone to move forward. This shift in perspective can accelerate progress and lead to more positive outcomes.
This way, you can effectively manage difficult situations, avoid disputes, and support franchise partners in achieving their goals.
Learning The Hard Way
Back in the beginning, when I was a Franchise Owner, I didn’t understand these concepts. I assumed that if someone invested a significant amount of money into a franchise, they would naturally listen to me, even if I was being their uncomfortable friend. I didn’t have those early conversations to set things up correctly.
I can think of some franchisees who exited, hating me and blaming me despite us doing everything right from a legal perspective under the franchise agreement.
From a legal standpoint, we fulfilled our obligations, but from a human perspective, there were gaps. In the earlier days, one franchisee even said, “It’s my right to fail,” which I found incomprehensible. He said this in anger and couldn’t accept responsibility or make changes. Reflecting on this, I wish I had known then what I know now! I would have approached things differently instead of washing my hands of the situation.
On the other hand, the success stories I’ve experienced are incredible. The key is always when individuals recognise that their actions determine their outcomes. When they say, “I understand that whatever I do will either turn this around or not, and I am determined to succeed,” that’s when change happens. These moments are often emotional and tearful, underpinned by passion, grit, and determination. Once they dig deep and find that resolve, success follows. Years later, they may come back and say, “Do you remember that conversation?” And I always do, because those are the moments that make a real difference.
Once someone gets over that hurdle and starts achieving success, their confidence grows. They realise they deserve a seat at the table and that it’s an even footing, not a hierarchy. These successes lead to the formation of new, positive habits. When someone is vulnerable enough to put everything on the table, it allows us to build a plan for success.
I’ve seen many franchise partners achieve extreme levels of success, reaching heights they never could have as employees. Still, it’s important to remember that running a business is not easy. It requires dedication, hard work, and the right mindset. Sometimes this mindset will go wrong, and it’s within your remit as the ‘uncomfortable friend’ to deliver the necessary feedback in a compassionate way.
In part 2 of this topic, in the next article, I’ll go further into how franchise support systems can work well or not well, and the aspect of coaching to achieve better outcomes.
