Sabrina Wall, CEO June 9, 2020
Millions of unemployed people are turning to franchise ownership as a result of the downtown in the economy due to Covid 19. These franchise buyers are trying to understand which opportunities are going to give them the biggest gains in a time of many losses. Naturally, the request for recession resistant franchises has grown tremendously as a result. But what makes a franchise brand recession resistant?
The normal business segments buyers think of as being recession-resistant include needed services for survival- food and shelter. But we have found the term “recession-resistant” can cover a huge swath of business industries. The real indicators of being recession-resistant ends up being less about what the franchise is and more about who the franchise is.
Good leaders create more good leaders
Each franchise has a unique team of leadership which provides the direction, support, vision and experience to make the brand successful. In times of a recession, it causes crazy things to happen to our brains. Some people during the pandemic were paralyzed by the fear and felt lost about what to do next. The leadership at the franchise really mattered in those moments.
The leadership needs to be strong enough to not only avoid getting lost in the stunning negativity of it all, but also bring to their franchise organization clarity and direction. If they do that well, the franchise owners are able to internalize that message of strength and then become the leaders within their own individual businesses and communities. Good leaders create more good leaders.
It was fascinating to watch the hundreds of franchises and see how their leadership reacted to Covid 19. Some ignored the issue all together and kept saying, it’s business as usual, which was the wrong message and upset a lot of people. Others took steps to mobilize the teams, created communications strategies, helped franchisees with their financial models, changed the products or services offered to accommodate the current market needs, and created closing and re-grand opening strategies.
They did so much. They pivoted the entire model in some cases, adapted the machines to perform other services, changed their entire marketing message, and delivered new marketing pieces and communication strategies for the franchise owners to use. In short, the leadership of the franchise helped the local franchise owners find their footing, showed them a clear path forward for their individual businesses, and showed them how to help their customers. They adapted and made quick changes that kept the local franchise owners relevant and strong.
The leadership within a franchise system makes it recession resistant because when you have strong leadership, no matter what the challenge, they will adapt to the current situation and find the best path forward for all. It’s The Who not the what.
A courageous and honest team
The next thing that matters most about being a recession resistant brand is actually the team. In times of struggle, hardship and heaviness, it can bring the worst out in people. But if the team, meaning the support staff and the other franchise owners, has an attitude of coming together, they will actually strengthen through the experience. The franchisee and team have to be willing to change and try new things. They have to be willing to talk to each other about what they are truly going through, what they are feeling and ask for help when they need it.
That takes incredible courage. It’s not easy for most people to be vulnerable. But if the culture of the franchise encourages openness, they will listen to feedback, they will help franchisees connect with one another, they will focus on supporting their franchise owners even when they are down, upset and stressed out by it all. That’s a culture which actually creates long term lasting relationships and partnerships.
When people go through hard experiences together it can create a much stronger relationship – if they handle those interactions well. Franchises whose culture is focused on upholding standards of conduct and communication like these – will create scenarios where they will weather the storm together and they will actually be better off not worse off as a result of the situation.
You see, there’s a clarity that happens in recessions. All of a sudden, everyone is focused on the highest priority activities that make you safe and even grow. In times of abundance, it’s easy to get distracted by all the options and non-essential activities. Recession can be a beautiful time of resetting, refocusing, and rebuilding from a position of strength.
Franchises whose leaderships and teams understand this, come together to work on it, and take appropriate action— are the most recession-resistant kinds of franchises you can find. The people who make up the franchise and the emotional strength, creativity, and willingness to be there for one another are the kinds of characteristics of a franchise that any new franchise owner would be lucky to join. In the end, it’s all about The Who, not The What.
If you want to learn about the franchises who have incredible leadership and amazing cultures contact us today and we will help you find them.