DATA-DRIVEN GROWTH: DON'T 'WING IT': Business strategies to help scale your franchise system.

Author:Ballas, Sam

East Coast Wings + Grill began franchising in 2004, with the first franchised unit opening in 2005. Since then, the brand has grown to more than 40 operating locations with additional units in development to sustain an annual 15 percent to 20 percent new-unit benchmark. Growing quickly, though, has never been the brand's focus. This may be counterintuitive to most franchise models but has proven to be one of the biggest reasons for our success.

While many franchisors get swept up in the need to build revenue--in many cases, due to the lack of capital --it's important to understand that rapid development doesn't always equate to more sales and success. To optimize system performance and achieve sustainable, long-term growth, a franchise system should grow strategically and at a manageable pace. This is achievable through the development and implementation of data-backed business strategies that, with the right foresight, resolution and patience, can help any franchise system grow responsibly.

Develop Your Benchmarks

The information gained from unit-level economics will help drive development decisions and serve as an excellent selling point to potential franchisees. The question becomes: How can you leverage unit-level data to maximize and map future growth opportunities? A great place to start is by creating a proprietary measurement system unique to your brand. Devise an algorithm based on key performance indicators (KPIs) and ironclad benchmarks. This will help your system determine what operating and sale standards should look like or closely parallel at every location.

The KPIs to which you attach numerical value will depend on your specific franchise. For example, being a full-service restaurant brand, East Coast Wings + Grill weighs metrics like guest count, customer-based surveys, ticket times and product consumption. Regardless of which ones you choose to focus on, your KPIs and subsequent benchmarks will identify units that aren't performing up to par, giving you the opportunity to address the issue appropriately before it becomes a real problem. It'll also show what high-performing units are doing differently, and those practices can be applied to existing and future units to better optimize performance.

A sustainable franchise growth plan begins and ends at the local level. No matter how you choose to measure KPIs and create those ironclad benchmarks--through your own franchise or with the assistance of a third party--ULEs equip...

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