Drive Your Franchise To Success, Part I

When she purchased Uniglobe Network Travel about eight years ago, the travel franchise was losing $5,000 to $10,000 a month. Today, it consistently posts a profit, thanks to Beard's quick action early on, when a survey of the Cypress, Calif., agency's operations revealed that customer service was virtually nonexistent.

"As soon as I brought in the business it would go out the back door if I couldn't service them," Beard says today. "So, we started to repair that and put things in place that would help us grow."

Beard identified the key components, called business drivers, on which her franchise's success depends. That, experts say, is the first step in building a strong business. Use a business plan to determine what drives your business. If you're still not sure, contact your franchisor or get professional help from your local Small Business Administration or the Service Corps of Retired Executives. Keep in mind, however, that if you have a tough time pinpointing your drivers - even with a business plan - you might be in the wrong business.

"Business drivers are related to how you make money," says Charles Green a partner in Trusted Advisors Associates, a business consultancy in Morristown, N.J. "In professional services, for example, several key drivers would be cost of sales, billability and rates. If you have a good handle on all three of those drivers, then you know how to make money in that business." He adds that business owners should concentrate on three to five drivers - no more, no less.

Business drivers vary by industry. There are, however, several key drivers that apply to virtually every franchise. Green says there are two big ones: knowledge management and people management.

In The Know
Managing your company's knowledge base requires you to keep your employees' skills up to date and their knowledge of industry-related products, news and trends current. That's no easy task, given the tremendous amount of information available today. "We all suffer from information overload," says Green. "If you can translate that information into knowledge it's helpful."

Your franchisor's training programs can be a tremendous help, as can technology. The Internet, for example, is an excellent source of current information, according to Michael R. Scanlon, Sr., owner of The Renaissance Consortium Limited, a small business consultancy in Chatham, N.J. He recommends visiting Internet newsgroups that apply to your business. Not only will you find news about your industry, but you could improve your own skills through the continuing education courses available on many newsgroups.

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