The 2018 bfa NatWest Franchise Survey reported that the industry contributes £17.2 billion per annum to UK GDP, employing 710,000 people, with 93% of franchisees claiming profitability and less than 1% of franchisors closing per year due to commercial failure.
These numbers are impressive, the industry works! But let’s not ignore that 7% reported that they weren’t profitable and under 1% failed and what you can do to prevent being part of these statistics.
Why do some not succeed?
This could be attributed to the concept or location not being right. But, if the franchisor has a proven commercial model and offer the right support in business planning, selecting the location and ongoing support, the failure of the franchisee might simply be due to not keeping active enough.
How to keep active and succeed
Keeping on top of your P&L is fundamental but you can only influence this when you fully understand the business operations. This doesn’t mean you need to dedicate yourself full-time to the business, you simply need to collaborate with your franchisor, engage with your team regularly and make sure you know what’s happening in your industry sector.
Keep active with your franchisor
A good franchisor will communicate with the network regularly, providing business, marketing and operational guidance and updates. A great one will encourage two-way communication, engaging with you personally, digging into your franchise performance and making recommendations based on their findings across the network.
One of the core Snap Fitness brand values is ‘One Team’, where we actively ask our network for feedback to ensure that we improve the service we offer to the consumer but also to our franchisees.
If you don’t actively engage with your franchisor, this can impact on the effectiveness of the support they provide and ultimately your business’ success. But, you are also missing out on the opportunity to contribute to the brand’s developments and the support you get to be successful.
Actively engage with your team
Low employee engagement has a big impact on productivity, quality of work and how long they stay. There are several factors that can cause this including lack of recognition, poor communication and not having a good understanding of the mission of the company.
At Snap Fitness we support our franchisee with employee engagement through onboarding and ongoing training programme (in person and online), regular visits to clubs and weekly communications. But, they are not employed by us as the franchisor, they are employed by you – and this means you need to engage with them too.
The term employee engagement doesn’t mean employee happiness or satisfaction. It’s more about the emotional connection and by engaging with your team on a regular basis you’ll build trust and productivity.
Plus, they will also be able to provide you valuable insights to feedback to your franchisor!
Keep an active eye on the sector
When you choose to invest in an industry sector, you’ll have done your research, understood the market opportunity and the ROI it can deliver. But consumer behaviours, expectations and spending change over time. What was current when you made the decision might not be current a few years down the line.
Great franchisors will continue to evolve their brand to ensure they have a competitive advantage and continue to grow their network. You’ll only know if they are doing this if you keep an active eye on the sector…
My advice is simple, keep active and you’ll be in the 97% who are commercially profitable.
As a fitness business, we also recommend physically to keep active too!
This article comes courtesy of Snap Fitness 24/7, one of the fastest growing fitness brand in the UK with a network of over 80 franchises in the UK and 1,000 globally.