The current lockdown period is proving to be a bruising experience for many of us, from both a business and personal viewpoint. During recent weeks we have all come to terms with a new order to daily routines, we’ve learnt that there are actually many things that we really shouldn’t take for granted and are trying to cope with the anxiety caused by a situation we have very little control over.

Franchisors have found that every aspect of their model has been put to the test; leadership, strategy, support systems, supply chain, marketing, communication are all under the spotlight. The financial implications could be huge, with the focus for franchisors being twofold – helping their franchisees to preserve their businesses in order to preserve their own. And, finding effective solutions can be a massive challenge. The Government aid may provide helpful respite and there’s a mountain of advice out there, most of it good (but beware of the pseudo business ‘guru’s’ spouting recycled ‘intellectualised’ views on management techniques that are invariably just basic common sense!)

One consequence of the disruption created by the lockdown is that for many franchisors recruiting franchisees will have been relegated down the list of priorities. Faced with significantly reduced sales or, in some cases, trading being temporarily suspended, it simply wouldn’t make sense to be trying to recruit franchisees.

It’s clear, however, that the impact of the lockdown restrictions varies significantly by market sector. In those which have been forced into ‘hibernation’, such as fitness, childcare and hospitality, it’s not surprising that most franchisors have virtually ceased their recruitment activity, apart from dealing with enquiries that were in progress. Other franchisors will be inactive as the result of having furloughed staff and/or having reduced their recruitment marketing spend. But, some sectors are experiencing little or no impact on trading performance. Our food & beverage clients are weathering the storm by successfully focusing on take-away and delivery and those in the domiciliary care and property services markets are largely unscathed; a couple have actually recruited franchisees during the recent weeks.

However, as we move into the next phase of the lockdown, with restrictions being relaxed, the thoughts of many franchisors will be turning to resurrecting their franchisee recruitment drive. With this in mind, we thought we’d share some observations about the influences on, and requirements for, a solid recruitment plan in the post lockdown period

1. Interest has dipped, but it will recover! It shouldn’t be a surprise that there’s been a reduction in interest in franchise opportunities during the lockdown period. Uncertainty about the future saps confidence about making the type of big decision that buying a franchise involves. This is evidenced by the volume of Google searches, which for common terms such as ‘Franchise Opportunity’ have dipped by circa 30% in recent weeks.

However, interest hasn’t dried up and it should start to gain strength in the coming weeks as confidence builds. Interestingly, our experience during the past few weeks is that the quality of enquiry is better; those enquiring about franchises in the current climate are identifying themselves as having a particularly confident and optimistic attitude, which is a pre-requisite quality of a good franchisee.

1. That recovery could be strong. If history repeats itself, there will be a bounce back. The recession we are about to move into could be a good period for recruiting franchisees. I have been through 3 previous recessions and, to varying degrees, it was the case that the pool in which franchisors fished for franchisees became particularly well stocked by those finding themselves unemployed. A ‘silver lining’ of a recessionary cloud!

Allied to this is that a crisis such as Covid-19 can often be a catalyst for change. During the lockdown period many people will have spent time reflecting on their personal circumstances and will have possibly reached the conclusion that a change is due. This may be that it’s time to break free from the shackles of employment. These people are obviously fertile prospects for franchisors.

So, the post lockdown period has the potential to give a healthy boost to the volume of ‘franchise opportunity’ enquiries. It may not be immediate, as some time will be needed for consumer confidence to build, but there will be a resurgence of interest in franchising. How this translates into sales will depend on a number of factors, not least the amount of redundancy money sloshing around, the capacity of the banks to step up and provide funding and on the effectiveness of each franchisors recruitment system. Which raises the question, “How ready are you to take full advantage of this surge in interest?”

1. Re-examine your strategy. Franchisors may therefore be looking expectantly at potential franchise sales as part of their post lockdown business restoration plan. Much of the work we’re currently doing for clients involves reviewing all aspects of the recruitment process to seek improvement in performance and cost efficiency. We use the knowledge and data available to fine tune the recruitment process flow, the profile of a franchisee, the targeting of the advertising, the tone and scope of the messages being communicated and the structure of follow-up engagement. The key questions that need to be answered by such a review are 1) “How do we make the franchise proposition more compelling and desirable to the right people?” and 2) “How do we further maximise the prospect of the right people being willing to commit?”. Do you have answers?

1. Digital marketing is key. Effective franchisee recruitment is now all about the application of digital marketing techniques. If you’re locked into the ‘old school’ process of simply generating a volume of leads and hoping to close as many as possible with bubbly sales ‘patter’ then I’d encourage you to re-examine what you’re doing, fast! A well-structured recruitment strategy has to be integrated, coordinated and ‘digitally savvy’. It must:

• Articulate a clear value proposition for the franchise opportunity
• Be precisely targeted at a defined audience – individuals who are a best match to your franchisee profile.
• Complement and be integrated with your consumer brand strategy.
• Focus on digital lead generation tactics – web site links, SEO, PPC, remarketing, social media, YouTube.
• Use engaging, persuasive and relevant content – written and graphic – tailored to each digital medium, avoiding hyperbole and exaggeration
• Generate content on a consistent basis – but make it informative, authoritative and relevant!
• Use a CRM program that automates the follow-up process to ensure effective engagement with prospects.
• Make use of technology to improve accessibility and efficiency. For example, thanks to the lockdown, video meetings have now become widely accepted, not just in business life. So, use them for Discovery and follow-up meetings.

1. An automated follow-up is critical. A systematic enquiry management process is vitally important to the design of an effective franchisee recruitment strategy. Thanks to the internet, candidates do their research into the franchisees they’re interested in well in advance of making an enquiry. They’re well-informed and so to provide the best chance of effectively engaging with them your CRM program must be configured to deliver a carefully sequenced messaging campaign that informs with relevance and the right frequency. Typically, this will use a combination of email, SMS and phone calls.

Furthermore, buyers often want to feel in control of the contact process. Simply making follow-up phone calls doesn’t cut it today; many people refuse to answer calls from a number they don’t recognise. So, it’s important that you’ve designed recruitment techniques that communicate with candidates on their terms and in a manner that overcomes the barriers that they will naturally create.

1. How convincing has your Covid-19 response been? It may seem obvious, but the way in which you’ve dealt with the Covid-19 crisis will be carefully scrutinised by franchise candidates. So, to re-charge your recruitment effort you’ll need to find ways of turning adversity to your advantage. You will need to be able to explain the challenges and the positive steps you’ve taken to support your franchise network during the lockdown in an open and honest manner. The fact that the outcome of those actions may still be unclear is irrelevant, what is important is that you can demonstrate a plan. If this is convincing it will provide the reassurance candidates seek and effectively reinforce the credentials of your brand and your team.

1. Be adaptable. In this current period sticking to the standard procedures isn’t going to work. Social distancing is here to stay for some time, which has obvious implications for how you engage with prospects. So, being creative and adaptable is going to be important. It’s unlikely, and unwise, to expect that you won’t need to physically meet a candidate during the recruitment process – video meetings are great but for either you or the candidate to make a decision a face to face meeting and site/field visit will still be essential. Which means finding ways to meet by observing the social distancing rules. For example, we have held meetings in outside locations. Again, technology can also play a role – video diaries made by existing franchisees may be a decent alternative to field visits.

1. Maintain your discipline. In the post lockdown period, when finances may be under considerable pressure, there’s a danger lurking in the undergrowth of franchisee recruitment – being less selective when awarding franchises simply because franchise fee income is viewed as the over-riding consideration.

Franchisors will know the importance of being highly selective when recruiting franchisees. The golden rule is to prudently grant the right to operate their franchise only to the right people; those carefully judged to have the character, skills and capability (hopefully using psychometric testing). More importantly, they should be aware of the painful consequences of appointing an unsuitable franchisee; they suck up valuable time and resources. But, the fact is that franchise fee income is an important chunk of revenue and difficult to ignore.

So, faced with depleted income, the resolve of franchisors will be put to the test during the coming months. Although it’s not unreasonable for a dose of commercial reality to be applied to the recruitment decision-making process, the importance of maintaining a disciplined selection process and ensuring that any compromise is based on non-financial reasons cannot be stressed enough.

These are very challenging times for all businesses. At the moment franchisors will be focused on doing all that they can to guide and help their franchisees but it’s equally important that robust plans are being prepared for the post lockdown period. Franchisee recruitment should be a key aspect of this plan.

Clive Smith

Franchise Focus