The Mindset of Franchisee Success and Profitability: Game, Set, and Match!

Over the last few weeks, I have read some value adding articles on LinkedIn relating to "logical and proven" methods that enable franchise business success.

There has been no shortage of great articles and case studies on the value of sales growth, increasing cash-flow, team empowerment, effective leadership and the importance of the understanding of financial statements.

The CPA in me naturally rejoices at the passionate advocacy of these game-changing strategies!

Yes! Without a doubt, the right strategies and more importantly, effective tactics make a significant and tangible difference between life and death of a franchise business.

Let me reiterate that you cannot be a successful franchisee without effective strategies, goals, and critical business plans!

For the coaches and mentors out there, we have the responsibility to impart highly relevant, focused and proven business knowledge to our franchise clients.

But knowledge on its own will not deliver results. Our client’s results will be determined by the “application” of this knowledge.

 And here comes The Red Letter Day moment! The application of this knowledge is ultimately determined by our clients’ ability to harness the power of their brain and mind.

 A few years ago, my team and I embarked on a nationwide journey of franchisee coaching and mentoring for a major Australian Coffee Franchisor. The broad scope, being an independent review of store profitability, was to provide high-level coaching and to mentor to franchisees that faced financial distress.

 Briefly, and not surprisingly, the usual suspects such as “not enough sales”, “negative cash-flow”, “lack of effective due-diligence”, “drowned in paperwork syndrome” and “poor money spending choices” topped the list of factors that contributed to franchise failures.

 I believe these factors were all 'symptoms' of a dominant root cause.

Before I go into the cause, let me also point out, successful franchisees thrived in the midst of prolific competition. These successful franchisees also faced a myriad of environmental and operational challenges. So how did these successful franchisees win the inner game of profitability and cash-flow?

The cause of failure and success came from the same source, it was the Mindset, the distinguishing difference being the ‘nature’ of the mindset!

 While successful franchisees had a “mindset of abundance and success”, unsuccessful franchisees had a “mindset of limitation and failure”.

I love the following quote from Buddha, which has inspired studies on the power of our minds:

"The Mind is Everything, what you think you become."

So the good news up front. Is a mindset shift possible for struggling businesses? The answer is an unequivocal yes!

Just like reconditioning our physical bodies through exercise, we have the innate ability to change our mindset.

 In essence, our mind exists as a product of past experiences. We hold on to fears and limiting beliefs.

How do we establish a mindset of success and profitability?

The short answer is as follows:

• We need to identify client values clearly – this stage is critical as values give birth to the nature of one's thoughts. Thoughts ultimately determine choices and choices influence actions. Results are a manifestation of one's actions.
• We establish the link between values and the existence of a franchisee’s business (the franchise). This is a worthwhile and necessary exercise as there needs to be an emotional investment in the business for ultimate success.
• We encourage creativity and a thinking of abundance when crafting grand visions and goals. In essence, we establish the "What do you want from this business" and the "Why do you want, what you want from this business."

The above steps are crucial before any traditional goal setting and business planning strategies are implemented.

The emerging research and discoveries in Neuroscience, Metaphysics, and Mind Studies have a strong role to play in franchisee coaching and mentoring.

One thing is for certain. Our results are influenced by our mindset!

A greater awareness and understanding of this area will help in establishing a strong and profitable franchise network around the world.