The American Franchise Act is probably going to pass this year.
If you’re a franchisor, this will mean a lot more clarity on what you can and can’t do when it comes to helping your franchisees with hiring. The joint employer fog that’s kept you on the sidelines is about to lift.
When you can finally help your franchisees build better teams, what are you actually going to tell them?
Playbooks for (almost) everything
You’ve built playbooks for everything. Product, pricing, location strategy, marketing. Your franchisees know exactly what to do.
But the thing that actually separates your top performers from your struggling ones? That’s the people they hire. And most franchisors don’t have a playbook to hand off to franchisees for that, not because you don’t want to help, but because you’ve unsure of what you can and can’t legally do to support because of joint employer issues.
What you told me
I handed out a lot of copies of The Franchise People Playbook at IFA last month. And it’s been really fun hearing your reactions now that you’ve had a chance to read it. The part that keeps coming up in the emails I’m getting is this idea of the “fifth P.”
If you haven’t read it yet… what are you waiting for?! Kidding. (Mostly.)
I’ll cover the concept briefly, but The Franchise People Playbook is free to download here.
You’ve probably heard of the four Ps of marketing: Product, Price, Place, Promotion. These fundamentals haven’t changed in decades because they work. And in franchising, you provide it all to franchisees. That’s the big benefit of joining the system.
At CareerPlug, we talk about a fifth P: People.
Who you hire, how you train them, and the path you create for employee growth is what establishes your identity within your franchise brand. Your people are how you stand out.
When a customer walks into one of your locations, the product is standardized, pricing is consistent, marketing is there. But the experience they have is determined by whoever’s working that day.
Right now, most franchisees don’t know how to get the fifth P right. They’re winging it, which isn’t a way to win.
AFA + the fifth P
If the AFA passes, franchisors are going to have even more room to move. You’ll be able to provide real guidance on hiring and retention without risking your entire business model. But that doesn’t mean you have to wait. And really, there is no time to wait.
You can set yourself up for success. According to the 2020 National Labor Relations Board ruling, franchisors can set brand standards, offer training materials, establish minimum staffing requirements, and provide helpful resources.
The franchisors who figure out how to support the people side of their business — systematically, the same way you support operations — are going to pull way ahead of everyone else.
More next week,
Clint