Webinar Summary
Former IFA leadership offered historical perspectives on times of crisis to chart a course through this period of COVID-19-related instability. The panelists stressed the need for positive culture aligned on common values of trust, open communication, and mutual support between franchisor and franchisee. The panelists also detailed the need for self-less leadership that puts the needs and priorities of others first, for relentless communication with stakeholders, and for empathy to those affected by the ongoing public health crisis.
Below are key bullet points from the webinar –
- Public health crisis and ensuing economic crisis is compressing the cycle of entrepreneurship, growth, decline, and renewal, and confronting businesses with challenges and opportunities
- Franchisors must communicate to franchisees, customers, and lend support to franchisees dealing with debt obligations
- Understand the mutuality of the franchise system: the extent to which your franchisees are successful inures to your benefit and business survival over the long term
- Prioritize effectively: identify where your team and resources will be needed and apply to greatest impact
- Highlight and share examples of self-less leadership throughout your system, and put your needs aside for the good and survival of your franchisees
Full Bullets -
- Any change is difficult, particularly change during stressful times
- People in leadership must make decisions in real time
- Culture is important and will determine the end-game. We change the culture by how we behave as leaders
- Problems come when the world changes but cultures can’t
- Encourage forward thinking leadership, clear and cool-headed thinking, and a culture of initiative and independence
- Cycle of entrepreneurship, growth, decline, renewal is compressed
- Need for leaders to call people to hope; negative thinking does not improve the situation
- For Franchisors:
- Investing in franchise offering is an investment in you
- Communication: be in constant communication with your franchisee base
- Sharing best practices
- Where the business stands
- They need to hear from you
- Lending Support: most franchisees have some degree of debt and probably can’t afford to pay that debt; lenders are very open and understanding to customers at the moment
- Franchisees will need many other things. Put your needs aside to be as helpful as you can to your franchisees, because the survival of your business is that of your franchisees.
- To the extent that your franchisees are successful inures to your benefit over the long term
- Challenging times: we must work harder than we ever have
- Look to history to inform the present
- This might have more profound change
- Self-less leadership – focus on franchisees, employees, families. Putting others first is an expression of leadership and taking care of others
- Relentless communication
- Empathy – for what is happening, walking in the shoes of those impacted
- Culture – rock-solid culture and how we respond and how our values align to challenges like this will define how we live and operate
- Prioritize effectively – breakdowns will happen; determine where your team needs to start and apply resources for the greatest impact
- Ability to execute – it’s one thing to have good ideas, and another to do something
- Highlight and share examples of selflessness and leadership
- Crisis means both danger and opportunity: respect the risk of the virus to your health, and understand that it is an opportunity to grow
No consensus point of view on how long economic recovery will take. Most people will remain in an economic hold. Consumer spending levels will be the marker of growth
Franchisors are guiding franchisees on how to deal with their bankers; how to defer interest and principle payments. All are working on lease deferrals, rent etc.
As you do cashflow planning and help franchisees to, you need to understand what to solve for and what strategies with purveyors can assist
Unemployment insurance benefits for employees
SBA 7a loans and loan forbearance
Leadership is about doing the right thing
Understand the financial impact that franchisees are going to. Whether to waive or reduce royalties is a brand-by-brand choice
If franchisors are not well-capitalized, then they’ll struggle to support franchisees more generally
Young brands may have some strengths in this situation – more individualized support, and can pinpoint where franchisees’ needs are.
Much of this has to do with capitalization