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BFS Capital Blog

How to Maintain Your Corporate Culture When Franchising

April 5, 2017

“You can teach someone pretty much anything, but you can’t teach him not to be a jerk.”

This, says Nedal Ahmad, founder of Miami-based Pincho Factory, is the key thing to remember when franchising a business.

Because while teaching a potential franchisee how to make your burger is simply a matter of education, duplicating your corporate culture is a much larger challenge. Even if the end product is on-point, an off-brand culture will be obvious to customers, and franchisees will be more likely to fail.

So how does one duplicate their corporate culture when handing the reigns of responsibility over to someone outside of your organization? It all starts with finding the right people.
Don’t Be in a Hurry for a Franchise Fee

You can’t be so excited that someone wants to franchise your business that you’ll accept just anyone. In the long run, that’s the quickest way make franchising a disaster. So careful selection of franchisees is the crucial first step.

For example, when Ahmad’s Pincho Factory – a Miami fast-casual spot that specializes in grilled meats and hamburgers – won the South Beach Wine and Food Festival’s Amstel Light Burger Bash last year, beating out the likes of Bobby Flay, Ahmad got over 400 requests for franchises. He has granted only six restaurant franchises.

“First, we look for a personality,” Ahmad says. “We look for people who are forward thinking, and have the same passion for food and service as we do. We also launched health benefits for our employees, we felt that was something that was an important part of retention and if a franchisee doesn’t agree with that, they’re out.”

Carefully selecting your franchisees won’t slow your growth at all; if anything, it will speed it up when the franchise-building process goes more smoothly with the right people in place.
Train to Your Culture

Opening a franchise is about a lot more than sending someone to show how much sauce to put on a pizza. It’s about taking part in employee hiring and making sure the people your franchisee is bringing on are a fit for your corporate culture.

Is this time consuming? Of course it is, but anyone who’s ever franchised their business will tell you being a franchisor isn’t just signing a contract and letting the royalties roll in. And taking part in employee selection and training is a huge part of duplicating your success elsewhere.

“Our director of training is heavily involved with putting the crew together,” Ahmad said. “So we train staff and get a feel for who we do business with well in advance. But we also put pressure on the partner and explain that this is who we started with, and we expect you to maintain that type of hire.”
Monitor Franchises Online and In-Person

There was a time, not so long ago, when in order to see if a franchisee was giving the level of service you expected, you needed to launch expensive surveys and/or wait on P/L reports. However, in the age of social media and online reviews, you can make changes much earlier on.

Set up separate social media accounts for your franchisees and monitor what people are saying about them, and do the same with online review sites. In the beginning, you must be extra vigilant to see what areas need tweaking before they become serious problems. You can be more proactive in your fixes than reactive.

Also, monitor the franchisee’s company voice online and make sure it matches what you do. If it’s not, you can address it quickly.

Beyond monitoring online, you also want to check in on your franchisees and monitor the culture in their stores. Ahmad says Pincho Factory also has a 300-point inspection his team goes through to ensure there isn’t a difference between a franchised location and a corporate one. And just as often, he’ll put his own stores under the same scrutiny.
Stay Connected to Franchise Owners

“One of the biggest misconceptions (about franchising) is somebody else is going to do the work for you,” said Ahmad. “It’s just as much effort, if not more, to have a franchise store versus your own.”

That means you not only need to make sure the right people are running your franchises, you need to show up and let your partners know you care. Because at some point, you were putting in the same sweat and aggravation every employee at your franchise is, and if they know there’s a CEO who can empathize it builds employee loyalty.

Culture is also very much about listening to what people on the front lines are saying, since they’ll sometimes have a better sense for how management is behaving than you will.

“We give the crews a voice to communicate anonymously to us,” says Ahmad. “We have a backend website where people can tell us without fear of repercussion.”
Finally, Just Let Go …

A certain level of micromanagement is necessary to create a successful franchise. But at some point, you have to trust that you have the right people in place and let them make their own decisions. If you’ve done your part in selecting great partners, helped them bring in the best staff, and have procedures in place to monitor corporate culture, you shouldn’t ever have an issue. And certainly not have anyone you have to teach not to be a jerk.