Making Site Visits Effective

Shared expertise can make franchising greater and be your system’s greatest asset.

By Mary Ann O’Connell, CFE

Site visits: All too often, franchisees fear them and franchisors do them only because they are required.  But, when approached properly, site visits can be your best tool for business and relationship building. It starts with determining whyyou are doing the field visit and the reasons vary.  Food service businesses are inspecting the cleanliness and safe food handling techniques to protect the public, some are visiting to see that brand standards are being upheld so there is a consistent customer experience and finally, there are those to build the franchisees’ financial strength. No matter what your reasoning, “Effective field inspections begin with well-defined compliance standards, strong relationship builders conducting the reviews and a process in place to ensure that items identified on the inspection are reconciled,” says Kelly Grace, vice president of sales at Volano Solutions, which produces in-field review software.  In other words, let your franchisees know what will be reviewed, how it will be measured and what the ramifications of those measurements will be.  We fear the unknown so shed some light and let people know why they are being inspected or reviewed.  Let them know this is to assist, not act as a police force.

THE "WHY"OF THE SITE VISITS

Amy Cheng, partner of the law firm Cheng Cohen, cautions that the inspection/review be based on objective criteria.  “The form should avoid subjective questions to the extent possible because different field reps can interpret circumstances differently.  Further, the field reps making the inspections should all be trained by the franchisor so that they understand not only the inspection process, but also then, what happens after the inspection.  What are the consequences if the franchisees fail to meet certain requirements?  How do you communicate that?  The communication from the field rep level and the corporate office needs to be consistent.” This is how it’s handled in the Nothing Bundt Cakes system.  Debra Shwetz, CFE, co-founder, said:  “We focus on the right people, great bakery operations, relentless marketing, financial fundamentals and enduring relationships. This consistent, simple model gives our support team repeatable goals whether we are attacking weak operations, new openings or developing solid operators and their teams.  It gives our support team a common language and gives us measurable goals.  Making the reports available online for all of the support team helps each department see areas of weakness and focus their efforts in these areas.” At FranWise, we recommend that all the brand and operating standards be called out clearly in the operations manual, complete with the repercussions and cure methods.  Consider adding language that describes the inspection process and the measurement criteria. Nothing Bundt Cakes uses a simple tool — self-evaluation — to engage the franchisee.  “We ask the franchisee to complete an evaluation alongside the support team member and then we compare the comments/scores,” said Shwetz. “The franchisees are often harder on themselves than we are!” It starts with the franchisor deciding which parts of the business have the greatest effect on the customer experience and therefore the franchisees’ profitability.  “Preparation for the visit is essential to effective field visits,” said Danessa Itaya, a vice president of Maid Right. “In addition to making sure we have their updated financials, we also bring their annual business plan so we can review their goals.  We also ‘mystery shop’ which allows us to get third-party feedback and review it with the franchisee.  We were a little worried as to how this would be perceived, but we have found that they are very appreciative of the mystery shop feedback.” This requires gathering data from point of sale systems, financial reports and comparing them to system-wide benchmarks.  Every franchisor should know the businesses' key performance indicators and the behaviors that affect them.  With this data, you can set specific goals and actions for improvement.  Shwetz said they require quarterly financial submissions then use these numbers to provide benchmarks for the system that are then used during these visits.  Like Maid Right, Nothing Bundt Cakes, uses monthly mystery shop scores to reinforce the brand standards and an exceptional guest experience.  It allows them to spend more time coaching and mentoring and not so much being a sheriff. Steve White, chief operating officer of PuroClean, echoes this idea.  “In my experience, having a set of current financial statements to review in advance of the visit makes all the difference.  The data tells us where our discussion should be focused to learn more about how we can help that franchisee improve their success.” This is how to turn a site visit into a business-building tool, but it requires that the franchisor employ the tools to gather store performance data and financial records and evaluate them regularly.  This turns a site inspection into a prescriptive visit rather than a police call.  As Tony Alessandra, Ph.D., author of “The Platinum Rule” said, “Prescription without diagnosis is malpractice.”  How do you help your franchisees improve when you have yet to determine what is or isn’t working? Amit Kleinberger, CFE, and CEO of Menchie’s Frozen Yogurt, sums it up this way: “The effectiveness of the quality assurance visits is generally correlated to:

1. The relationships the ‘inspectors’ develop long term with the franchisee.  These need to follow a ‘be respected, not liked approach;’
2. The level of real-world knowledge the inspector brings to the franchisee.  The inspector has to be highly skilled in the workings of the brand;
3. The perceived value of the franchisor as whole.  A franchisee listens more when he feels positive about franchise system; and,
4. The method of evaluation needs to consist of an inspection and business coaching components as one.

When all of these are met, you will have a more effective field inspection program.” Successful field inspections start long before the franchise representative steps into the franchisee’s business.  These powerful business-building tools start in your planning stage, but there is always time for adjustment and improvement.  For successful site inspection visits:

•  Clearly identify your key performance indicators and brand/operating standards.
• Identify and define them in the operations manual.
• Create an objective measurement tool and criteria to be used in the field.
• Explain the system and the goal of the meeting to the franchisees.  Make it part of the corporate culture.
• Work to build a relationship of coach and advisor, not police force.
• Gather key financial and performance data in advance, so you know which causes to look for and which changes to prescribe.
• Set goals, actions and remedies and define the timetable.
• Have staff work to create and maintain a respectful working relationship.

If you need additional help with building an effective site inspection process, contact successful franchisors and suppliers for more great ideas.  Shared expertise can make franchising greater and be your system’s greatest asset.

Mary Ann O’Connell, CFE, president and founder of FranWise.  Find her at fransocial.franchise.org.