Winning Teams: Franchise Satisfaction Survey
Entrepreneur Magazine • January 2001
by Jane Shealy
MaidPro's Ranking: 32 out of 200!
Received a full 5 out of 5 stars in all four categories:
Overall Satisfaction: «««««
Financial Satisfaction: «««««
Quality of Training: «««««
Quality of Field Support: «««««
How franchisors and franchisees pair up to beat the competition.
The whole is greater than the sum of its parts.
You’re only as strong as your weakest link.
On the ball field or in business, you’ll find plenty of maxims like these touting teamwork as essential to success. Yet,
nowhere are they more applicable than in franchising, says Martin Charlwood, president and COO of Vancouver, B.C.-based The
Uniglobe Group, an international travel retailer.
“In terms of a business format, franchising is the best guarantee of success,” says Charlwood. “You’re in business for yourself—not by yourself. But the bottom line is that for franchisors to be successful, franchisees have to be successful.”
Last fall, SUCCESS Magazine ranked U.S. franchises—from the franchisors’ vantage. In this issue, the Franchisee Satisfaction Ranking re-ranks the 200, adding the franchisees’ perspective to the equation. Although respondents represent different industries, they gave high marks to franchisors based on a number of common elements:
• Trust and communication
• Product and passion
• Leadership, training, and support
McDonald’s franchisees gave their company highest honors. Rounding out the top 10 were: Color-Glo, American Leak Detection, Weed Man, Wireless Zone, Home Cleaning Centers of America, Sports Clips/Command Performance, Primrose Schools, Tumbleweed Southwest Mesquite Grill & Bar, and Planet Beach Tanning Salon.
A More Sophisticated Franchisee
“Franchisees are more sophisticated these days,” says Bruce Bloom, president and CEO of Knights Inns hotel chain, headquartered in Parsippany, N.J. “However, they still need to trust the franchisor’s sense of the company’s overall direction. Likewise, franchisors need to recognize the value that franchisees bring to the table in maintaining a competitive edge for the system.”
Trust is, perhaps, the result of everything else on the do-right list, and it begins with good communication.
“Communication is the No. 1 issue,” says Jo Kirchner, president and CEO of Primrose Schools, headquartered in Cartersville, Ga. “From franchisor to franchisee, from franchisee to educators, from educators to parents.
"We listen to our franchisees. We need to know what’s working and what’s not. Otherwise, the confusion could negatively affect our brand nationwide.”
And what worked in the past may not work in the future, Kirchner says. Companies need to examine their communication strategies frequently. For example, Primrose used to publish a quarterly newsletter. “That’s not enough any more,” she says. The company now uses an intranet to distribute news and address issues as soon as they arise.
International Franchise Association executives say the role of franchisee is more important than ever. The membership underscored that notion by electing Steven Siegel, a Dunkin’ Donuts franchisee in Woburn, Mass., to a position that puts him in line to become IFA chairman in 2002. He will be the first franchisee to hold the office.
Siegel says he believes that “involving the franchisee in the system is an indicator that the system is striving for excellence.”
Product and Passion
Of course, unless a franchisor produces a good product, no one stands to gain. But married to product excellence is the passion to excel by enthusiastic franchisees.
More than 20 years ago, Kirchner was planning for a big career. Two children later, she was a stay-at-home mom looking for good childcare. Today, she provides that service—with a passion—and finds herself in good company at Primrose.
“Almost half of our franchisees started out as parents with children in the system,” Kirchner says. “That’s a great indicator of how much they believe in the product.”
Another measure of success within the Primrose franchise system is growth—in number of schools as well as revenues, she says. In 1998, Primrose had 25 locations and annual revenues of $44.16 million. In 1999, 72 locations and $58.49 million. At the end of 2000, there were 83 locations and revenues topped $74 million.
Kirchner began her career with Primrose by developing its advertising. She became president during the company’s acquisition in 1999 by Security Capital Corp. (SCC) of Greenwich, Conn. She wanted to be involved in the transition to ensure that new ownership didn’t dilute the program’s quality. “It happens so often,” she says. “Just for the sake of growth you lose what brought you to the table.”
Kirchner says that didn’t happen, and she remains passionate about her work.
“When I walk into the schools I see what I, as a mother, wish I could’ve found. I take a lot of pride in that,” Kirchner says. “I would have advanced in my personal career more quickly and with much less anxiety if I had found a place like Primrose when I needed childcare.”
Instead, Kirchner stayed home for several years with daughter Keri, now 21, and son Dustin, 24. Keri has taken the plunge into the business world, while Dustin shelved college attendance to pursue his love of music. That leaves Kirchner home alone with husband Rick, an equine pharmacist, on the farm where he enjoys tending their horses.
She couldn’t be happier that her children are doing what they love and are willing to make some sacrifices to do so, Kirchner says. “Both my husband and I have followed our passion, and it’s made an impression on our children.”
Leadership, Training, and Support
Kathy Miller was also inspired by Kirchner’s example. The Cary, N.C., franchisee says she stopped considering other companies after meeting her and finding the leadership she was looking for.
“I was impressed with Jo’s background and with the expertise of everyone involved in the franchise,” Miller recalls. “They were committed. The support system seemed to be good. I thought it was a good fit. That all turned out to be true.”
Not that Miller thought she needed much help when she and husband Stew opened the first of their three schools six years ago. She admits she had plenty of ideas about how to do things her way. While many of those ideas were incorporated and she was given a lot of latitude, Miller says she backed off her independent position a bit and embraced the training and support she was offered.
“That’s what you pay all this money for,” she says. “And if you follow the formula, it really works. I see the value in what they’ve given me.”
Marie Cardile, who became a Mrs. Field’s Cookies franchisee in Raleigh, N.C., three years ago, agrees. “If you can’t follow guidelines, don’t get into a franchise,” she says. “I believe in the franchise system. I like that support. I like that relationship.
“Like any relationship, however, you get out of it what you put into it. You can’t just stand behind the counter or the name.”
She hasn’t. Cardile, who says too many franchisees believe the franchisor is responsible for making them successful, has participated in developing new products and services in hopes of increasing the value of her business. She joined Mrs. Field’s franchisee advisory committee, serving as president for the past two years.
Miller has also been active on her company’s franchisee advisory council for five years, serving as president last year. “I thought they needed my perspective,” she says. “This year, I realized how much I’ve gotten out of it. I’m aware of our long-range plans, and I got great ideas from other franchisees.”
Cardile also gives Mrs. Field’s high marks for support. “Our regional sales manager is our first point of contact. He’s outstanding. In addition to visiting once a month, he has a pager and responds immediately—not just if there is a problem. Nothing is ever too much trouble.
“We are also free to contact purchasing, marketing, whatever department we need—directly. We receive a communications package every other week and a merchandising guide at least monthly.”
The merchandising guides are suggestions for attractive seasonal displays, Cardile says. This is something she believes in because, “People eat with their eyes.”
Her husband, Jeff, saw the potential and left his banking career to join her. As Cardile puts it, “Instead of rolling in dough, he’s rolling the dough.” This year, the two plan to open a Pretzel Maker, a concept also owned by Mrs. Field’s.
Other means of support praised by franchisees included:
• Use of an Intranet. Bethesda, Md.-based Handyman Services launched an internal online support network that, with a few clicks of a mouse, disseminates information about day-to-day operations and provides virtual training system-wide.
• Internet Home Pages. American Speedy Printing, based in Troy, Mich., launched i.Site to provide franchisees with customized websites. Franchisees can also interact with customers via online ordering and file transfers.
• Hands-on Help. Mentoring is key for Minneapolis-based Cost Cutters Family Hair Care. Each franchisee is assigned a service team made up of representatives from marketing, education, operations, finance, product, and distribution. New franchisees are also matched with veterans, and they talk at least weekly during the critical first 90 days in business.
That’s the human factor, according to Cardile. And in relationships—between employee and customer, between franchisor and franchisee—it can make or break a business.
That’s how Aretha Franklin spells it. So do franchisees.
It used to be all about the franchisor. Not any more, says Bloom, who is also chairman of the International Franchise Association’s Franchise Relations Committee. “I’ve seen significant and profound changes in the relationship between franchisor and franchisee over the years. It wasn’t until the late ’80s and early ’90s that I began to see a great emphasis placed on the role of the franchisee in the overall scheme of things. Certainly before that, I saw franchisors who were creating a team approach because they understood the importance of the relationship to the company as a whole.
“Franchisees were becoming more sophisticated at the same time,” Bloom recalls. “They were becoming concerned about the health of the overall system, their investment, their brand. They wanted a voice in the decision making.”
Successful franchisors and franchisees listen to each other, Bloom says. “The right formula is unique to each franchise system. But if a franchisor fails to listen to the folks on the front line and vice versa, both may find themselves unable to keep up with competition in the marketplace.”
A franchisor cannot sell additional franchises without successful franchisees, Bloom says. “If you’re relying on franchisees to build your brand, you need to develop substantial, long-term relationships with them. In doing so, you create value for your owners, shareholders, limited partnerships, franchisees.”
“The marketplace will continue to challenge us,” Bloom says. “We need to work together to meet those challenges.”
Method Gold 200 Franchisees
How they ranked ’em.
In May 2000, SUCCESS Magazine commissioned the University of North Carolina Research Unit, in Chapel Hill, to gather information about U.S. franchisors from their franchisees to provide a ranking of these businesses by the people who know them best.
Researchers began with a list of last year's Franchise Gold 200 winners chosen from the results of a survey conducted by Erdos & Morgan, an independent marketing and research firm based in New York City. More than 2,500 franchisors and related professionals were contacted. Companies were compared based on four major indicators: financial performance; corporate management, growth, and stability; franchisor/franchisee relationship; and opportunities for growth.
In the Franchisee Satisfaction Ranking, it was the franchisees' turn to grade the franchisor. Unit owners were chosen at random and asked to respond to questions related to their satisfaction overall and in the areas of finances, training, and field support. Their responses were based on a scale of 1 to 5 (dissatisfied to most satisfied). Points were awarded for each answer, and the company received a star for each increment of 20 points toward a perfect score of 100.
Overall satisfaction was given a weight in the rankings of 40 percent. The other three categories (financial, training, and field support) accounted for 20 percent each of the total score.
Actual percentages—not given in the accompanying chart—were applied to the scores in order to break ties between companies and rank them. However, the difference was at times so small among companies in the top 50 to 100—one 10,000th of a point in one case—that the contest, like last year's presidential race, was almost too close to call.
What is easier to say with certainty is that most franchisees are happy with the business they're in.
Of the 200 franchisees surveyed, 136 gave a perfect 5 when asked about their overall satisfaction with their franchisors. An additional 54 gave an answer of 4. That's 190 of 200 franchises surveyed that have very satisfied owners. Good news for all concerned.
Other rankings for comparison:
Aamco Transmissions: 126
Fantastic Sams: 146
Gingiss Formalwear: 198
Jiffy Lube: 75
Lawn Doctor: 175
Mail Boxes, Etc.: 149
Meineke Discount Muffler Shops: 196
Sir Speedy Printing Centers: 118
Super Coups: 183
Wicks'n Sticks: 154