By Uche Ubani on Jan 16, 2021 11:13:40 AM
Data is the centerpiece of decision making in business today. Not only is it important to back business decisions with reliable data, it is necessary to start gathering data early in the life of your franchise business.
Data affects every part of your business and is the output of the actions and decisions already made. It should also be the primary consideration for the actions you take in the future of your franchise business.
“Without big data, you are blind and deaf and in the middle of a freeway.” - Geoffrey Moore.
Below, we discuss a few of the numerous benefits of data to a Franchise system.
Data helps you review your franchise performance over a period as well as compare this to other similar periods. With this you can actually see how well your business has done year on year. Even more important is the fact that you can derive the same information for all your franchisees as well. This provides an opportunity for the franchisee to see how their business has performed compared to their own previous performance. This helps to make projections, set goals for the coming years and plan appropriately, using previous performance data.
Not all franchisees perform at the same level. Some are exceptional and deliver sterling results while others may have some difficulty for various reasons. Data can help reveal all this to the Franchisor, affording them the opportunity to provide support for the franchisees. This also injects a spirit of healthy competition amongst franchisees and ultimately, increased earnings for the Franchise system. It also provides opportunities to compare franchisees in similar locations and deduce which products and services are more viable in specific locations.
Understanding your business
When data is analyzed it provides such important information that helps you understand your business. A typical example is a Strength, Weakness, Opportunities and Threats (SWOT) analysis. Your strengths and weaknesses are internal to your business, while opportunities and threats are external. This helps you understand what areas your business is strong in, enabling you to continue with those practices that have made it so and where it is weak, so you can find ways to improve on it. The opportunities you can take advantage of to meet your business objectives and the threats that can possibly derail you. As Carl Sagan said “You have to know your past to understand your present”.
Tracking Franchisee Activity
Franchisors can derive so much information from good data that helps them stay on top of all the Franchise activities and see problems early. For instance reviewing leads conversion data can show you which franchisees are having problems converting leads. This may provide an opportunity for training and other support, to improve this metric. You can also derive locations-specific market intelligence. This helps you understand the peculiarities of each franchise location and further determine how to position your brand, products and services to maximize the benefits and meet your business objectives.
Understanding your customers
There is probably nothing more important to a business than generating revenue from their customers. Data helps you understand your customers and be able to place them along different segments and demographics. This helps you identify and target your most important customer segment for marketing activities. For instance you can track your marketing campaigns to see which delivers the highest amount of new customers and leads, therefore helping you understand how best to focus your marketing dollars. Data helps you understand how customers in different locations respond to your products and can help develop strategies for better market penetration and revenue growth.
The Better Software offers an amazing hub structure that receives all the data from each location and gives the franchisor a birds eye view of the entire business. From here you can view the cumulative performance figures as well as drill down to individual franchise locations to see their specific data. Alongside this, we have amazing reports including our royalty report, which tracks all your royalty earnings across the franchise network.
As Clive Humby said “data is the new oil”. Understanding your past performance, the operating environment, the expectations for the future of the business, enabling tools, customer behavior etc. can help you position your franchising business for great success.