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The franchise industry continues to go from strength to strength with many franchisors seeing significant uptake of licenses from people looking for the opportunity to own a proven business model and hit the ground running. Between 2015 and 2018 the number of U.K. franchises increased by 10 per cent to 48,6000 according to the latest British Franchise Association (BFA)/ NatWest Franchise Survey. Fast forward to 2020, and the industry is described as “booming” by Andrew Brattesani, head of franchise for HSBC UK, which saw the bank take on hundreds of new customers.
Naturally, seeing so many franchises expanding especially during a downturn is fantastic news, but consideration must be given to the implications of such sudden growth. For example, a franchisor must be able to monitor how each unit in their network is performing, and also quickly identify when problems arise. Failure to do so will likely result in franchisees missing their sales targets, which could be disastrous for the franchise as a whole. To mitigate this, there must be an emphasis on ensuring regular communication and adherence to systems and procedures. Yet the more the network grows, the greater the administration and oversight that is needed to manage it. This can test the organization and efficiency of any business, which, more often than not, will have to evolve new ways of doing things.
“Over the last few years CRM is something that franchises of all sizes are investing in”
The most effective solution to this is likely a technological one. It is no secret that tech has become a valuable asset to all manner of businesses. Across many industries “digital transformation” has become a commonly heard phrase, which at its most basic level is used to describe the adoption of new technologies by companies, in order to automate key areas like payroll or sales. Doing so is increasingly considered an essential business activity, helping to reduce operational costs, improve productivity, increase profits, and generate an overall better customer experience. It is no wonder then that worldwide IT spending is projected to total $3.8trn in 2021, an increase of four per cent from 2020, according to the latest forecast by global research and advisory firm Gartner.
Yet achieving genuine digital transformation is often beyond the means of most businesses, requiring huge investment, fundamental organizational change, and employee reskilling, with no guarantee that it will be successful. Costs can run into the thousands, if not millions, and even when achieved, savings not realized for many years.
The essential first step toward digital transformation
The reality is that achieving digital transformation should be a long-term objective, but that does not mean franchises cannot immediately harness many of the very same technologies that are employed by the world’s most successful companies. Yet with so many digital tools emerging at an increasingly rapid pace, the challenge for franchisors is working out which ones they should be investing in now to ensure sales growth and organizational cohesion.
Customer Relationship Management (CRM) is a clear example of business-critical software and is often the first step towards going digital, being able to automate numerous mundane tasks in order to improve business efficiency. A franchisor can use it to store, update and analyze franchisee information, monitor contract renewal dates, build stronger relationships within their network, and manage sales data and enquiries.
For example, a CRM can weed out unsuitable licensee enquiries, while automatically collating potential leads, before storing the data safely in an easily accessible format. Immediately afterward it can be passed over to a franchisor’s sales team to process. Time-consuming administrative tasks are mitigated, allowing sales teams to focus on what they do best. It also helps build deeper and more effective relationships within franchise networks because interactions with them can be easily accessed in order to understand their financial value and forecast their future needs.
“A franchisor must be able to monitor how each unit in their network is performing, and also quickly identify when problems arise”
Analyzing data to create meaningful business insights is a primary function of CRM software, whether that be the individual performance of internal departments, franchises or leads. Furthermore, a CRM will be able to create appropriately tailored communication materials using the very same information to proactively and appropriately engage with them. This could be anything from sending out celebratory messages when business is going well, or simple reminders to ensure pertinent activities are actioned.
It also should be noted that a good CRM stores your database securely in the cloud giving access only to who you want, when you want. Individual records can be locked down to specific team members, sales teams, or regions, or locked so they cannot be accessed or exported. All actions are recorded within the CRM so you can see when items have been amended and by who. The chances of losing data or it being inputted incorrectly are entirely minimized.
Therefore through proper oversight and organization, a CRM helps ensure shared standards and values, high performance, mutual trust, and effective communication, which are so critical for the success of franchise organizations.
Proving the value of CRM
Over the last few years, CRM is something that franchises of all sizes are investing in. Industry-leading sales and service analysts and training provider, 59club, is an example of a successful franchisor that has expanded rapidly using an effective franchising model since its creation in 2007. A market leader in the provision of bespoke performance management programs for the golf, leisure, spa, events, F&B and hotel industries, 59club has recently completed the rollout of a new CRM system to franchises across the United Kingdom, Europe, the Middle East, Africa, Asia and the United States.
Its purpose is to ensure cohesiveness and efficiency throughout the company’s network, but also better support member franchises through technology and statistical data, by enhancing the services they offer their clients. Whether that be sales forecasting and managing prospective business opportunities, to improving productivity via the automation of client servicing and support meetings, to basic administrative tasks such as invoicing.
Similarly, the BNI National Office for U.K. and Ireland has made effort to support its members through tough economic conditions brought about by the coronavirus. Whether that be through building their professional networks, supporting their development as confident leaders, or ensuring the optimum conditions for the creation of business opportunities. With as many as 500 local Chapters meeting every week and more being created daily, it is vital that systems are in place to ensure the highest standards of the BNI are maintained, and activities such as marketing and sales support organizational objectives.
Therefore the BNI is currently investing in a bespoke software solution that would enhance its offering to members but also elevate sales, support lead management, and ensure accountability. When finalized its CRM platform will augment and automate existing marketing processes, ensuring that members’ details are effortlessly stored, secure, and accessible. Additionally, new enquiries will be easily traceable, with reminders in place to ensure timely responses.
The right tech can be a game-changer for franchises
With the global economy facing a “slow and challenging economic recovery” according to the World Bank, businesses will have to make efficiency savings and informed, data-led decisions in order to prosper in adverse markets. Given that industry leaders within the franchising industry understand and continually invest in their CRM, it should be clear that the technology has value. That does not mean you have to invest huge amounts of revenue to secure a strong performing CRM. There are a number of market options with a myriad of features and price tags. What is important is that you find the one that is best for you. Remember, though, that training in the use of your CRM should always be part of your package, as well as implementation and support. After all, in order to get the most out of your CRM, everyone needs to be able to use it, but also understand how it will benefit them.
Adam Hannath is sales director at BuddyCRM, a CRM solution developed by salespeople for salespeople.
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