Franchise Update Magazine - Issue II, 2026 by Franchise Update Media

By taking an active role in franchise resales, brands can keep locations open and protect system revenue.

Franchisors that translate analytics into clear guidance help franchisees improve performance and profitability.

FRANCHISEUpdate June 2-4, 2026 | Atlanta, GA

ISSUE 2, 2026

Consistency at Scale

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Look Inward First

Contextual practices, not borrowed best practices, create strong systems Written by ANDREW SEID

ranchising as a business model can be seen to produce some common outcomes and processes that brands follow across industries. These commonalities can be the result of copycatting, but the best-structured franchise systems look internally at their processes and culture. They determine which unique systems and standards fit their brand. Matching other brands inside or outside of their industry is unrelated to the goal, which is to create the right systems for that particular brand. The cookie-cutter approach to franchise system business structure and legal documents lessens the efficiency and effectiveness of the relationship for both the franchisor and franchisee. One-size-fitsall solutions can negatively affect the sustainability and return on investment, and the franchisorfranchisee relationship can suffer. A boilerplate approach affects the efficiency of the recruitment effort and creates issues in system sustainability. Managing the system becomes more challenging than it needs to be. People refer to franchising as an industry, but it’s not. Franchising is a sector of the economy; it’s an alternative method used by industries for expansion and downstream product and service distribution. It is made up of more than 100 distinct industries. Within each of those industries are companies at different stages of development, performance, makeup, products, and services. Some have national and global potential, and others are limited to regional growth. With such diversity, the concept of best practices frequently touted in franchise lectures and on podcasts makes little sense and is frequently counterproductive. To maximize success, companies need to focus on contextual practices, which require you to look 8 | Franchise Update | Issue 2, 2026

through the lens of a company’s history, culture, environment, consumers, economics, franchisees, and other relevant factors. Thinking that franchise systems are fungible, ignoring the brand’s underpinnings, and copying another brand’s best practices leave you with less than satisfactory results. Creating a franchise strategy and managing that system based on the principles of contextual practice are essential for brands and their franchisees to prosper.

INTERNAL AUDIT

The temptation when a system change is needed is to look outward at competitors, industry trends, and what other franchise systems are doing. While external context matters, it should be secondary to a rigorous internal audit. What is driving the need for change from within your system? Is it a breakdown in operational consistency across locations? A shift in your core customer’s expectations that your current model no longer serves? A gap between the founding philosophy of the brand and how it is delivered? The answers to these questions are brand specific and should produce a brand-specific solution. Generic best practices borrowed from outside your system may solve a generic problem but rarely account for the history, franchisee demographics, operational culture, and customer promise that make your brand distinct. The most durable system changes feel inevitable to the people inside the brand, like a natural extension of what the brand was already becoming, not an external imposition. It’s important to conduct an efficient audit to understand the brand’s underpinnings and the changes required. A philosophical approach

that we have used with our clients for many years focuses on five key elements: consistent, sustainable, replication, communication, and culture. Perhaps the most important of the five elements is understanding the system’s culture and how it shapes the brand’s relationship with franchisees and, through them, the consumer. This is closely followed by communication and the methods employed when things are going well or when conflict exists. Cultural alignment within your corporate or support team must come before franchisee engagement. If the people responsible for implementing the change don’t genuinely believe in it or can’t articulate how it connects to the brand’s values, franchisees will sense the disconnect immediately. Internal alignment isn’t just about getting everyone on the same talking points. It’s about ensuring that the people closest to franchisees, your field consultants, regional managers, and support staff, have deeply internalized why this change matters and are prepared to model the mindset you’re asking franchisees to adopt. This inside-out approach also means being willing to examine whether your internal systems and behaviors are consistent with the change you’re asking franchisees to make. If the change requires franchisees to embrace a more transparent, collaborative operating model, that same standard needs to be visible in how your corporate team operates. Culture is contagious in both directions. Many layers of work need to be considered when updating your current offerings, including how you approach imagining change and then going through the development process. How do you communicate the “why,” the process, and the change? How will franchisees and customers perceive the change once it is introduced? These questions must be asked and answered by your team. Don’t fall into the trap of examining every change in the context of whether someone else is doing something similar. Instead, start to think of your brand contextually through the five tenets of effective franchising: consistent, sustainable, replication, communication, and culture. Change is hard, but standing still, making minor tweaks, or copying someone else’s strategy because it feels less disruptive rarely leads to sustainability or growth. There is a long and growing list of brands that stood still and are no longer with us. Remember, change takes time, and it requires an open mind. Frequently, an outside shepherd can guide your way.

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Andrew Seid is senior consultant at MSA Worldwide. Contact him at aseid@msaworldwide. com or 860-604-9189.

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Anatomy of a Brand

Reinvention to Revolution Hotworx builds a new category in fitness Written by STEPHEN P. SMITH

rom college football and Arena Football to professional bodybuilding, fitness has always been an essential part of my life. Growing up around athletics taught me about the importance of competition and discipline. As an 18-year-old working part-time at my local gym, I discovered something even more defining: a passion not just for fitness, but for the business of fitness.

But before we get to how Hotworx became the revolutionary fitness brand it is today, we have to first look at the business I built just before that: Planet Beach. I founded Planet Beach in 1995 as a tanning salon and wellness franchise. It’s a brand that I still own today. Planet Beach grew rapidly and became a recognized name in the wellness space. But as consumer trends shifted and certain tanning beds began to fall out of favor with the public, I knew we couldn’t stand still. Reinvention has always been a part of my entrepreneurial DNA. When the market changes, you adapt or disappear; you need to invent your way out of the problem.

CREATING THE CONCEPT

I began incorporating hot yoga into my workout regimen. I loved the results: the sweat, the muscle activation, the recovery benefits. But hot yoga was rarely standardized. Many studios relied on inconsistent heating methods, and some even used a simple space heater to raise the temperature. I also grew frustrated with the time commitment. 10 | Franchise Update | Issue 2, 2026

Our next challenge was related to the equipment inside the saunas. I was inspired at a fitness trade show when I saw a demonstration for a new type of rowing machine for HIIT exercises. I imagined putting this machine in our saunas. But traditional rowing machines wouldn’t comfortably fit in the saunas, nor were they optimized for a heated environment. I went to the drawing board, literally, and designed our now-patented Thunder Row. This innovative machine features a 360-degree handle swivel, a double pulley system, and dual water turbo tanks to emulate the feeling of rowing through water.

THE FIRST STUDIO

NEED TO EVOLVE

I opened my first fitness center in 1986. I was immediately hooked, energized by the activity in the gym and fascinated by the systems operating behind the scenes. That entrepreneurial spark set me on a path that would eventually lead to the development of Hotworx, a 24/7 infrared sauna fitness franchise with more than 800 locations worldwide.

exercises of my career, we ultimately chose Hotworx and trademarked the name.

Dedicating 90 minutes to an effective exercise followed by a separate sauna session for recovery didn’t feel practical as an everyday routine. While on vacation with business partners, someone casually mentioned, “People should exercise inside a sauna.” That statement stuck with me. It was the ultimate multitasking solution for getting the best benefits of infrared energy, heat, and exercise all at once. The original concept for Hotworx was born. I quickly began designing what would become our patented infrared sauna built specifically for exercise. The vision was to combine infrared energy and heat with isometric exercise. Later, we added High-Intensity Interval Training (HIIT), delivered in short, efficient sessions. Our motto became, “More Workout, Less Time.”

OVERCOMING CHALLENGES

As with any great business idea, the early days came with challenges. The first was the name. We needed something strong and descriptive that signified this brand was built to withstand the test of time. Our initial name for the brand was Hot Box Detox, which was trendy but didn’t scream longevity or how innovative these saunas truly were. We needed a name that felt like a movement, not a moment. After one of the most challenging marketing

We opened the first Hotworx studio in Oxford, Mississippi, in 2017. Each studio features eight to 10 patented infrared saunas. With a maximum capacity of three people per sauna, we’ve created an intimate, focused workout environment without the pressure of a large group class. Hotworx offers 12 different sessions, including 15-minute HIIT workouts, like rowing and cycling, and 30-minute isometric sessions, like Yoga, Pilates, Barre None, Stretch, and Warrior. All sessions are taught via virtual instruction and served up on a continuous cycle with access for members 24 hours a day, seven days a week. What started as a reinvention strategy evolved into an entirely new fitness category. We’ve developed a controlled environment that delivers both consistency for members and scalability for franchisees. Today, we serve more than 400,000 active members and have grown to more than 800 studios open around the world, including in the U.S., Canada, Ireland, and, most recently, Dubai. We also have studios in development in Mexico. Our goal is to have 1,000 locations open and in operation by the end of the year. Fitness has always been my foundation. However, building systems that help others succeed is what drives me. I’m proud that Hotworx represents the intersection of both, and we’re just getting started.

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Stephen P. Smith is the founder and CEO of Hotworx.

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Meg Roberts

“My outlook is always optimistic. I was born ‘glass half full,’ so we press on and through whatever the economy brings.”

Firm, Fair, and Friendly

Scaling a beauty platform with discipline and service Written by KERRY PIPES

Roberts approaches her role as a service-driven, disciplined leader who blends structure with warmth in a style she describes as “firm, fair, and friendly.” Her people-first mindset is clear in the way she talks about lash artists, stylists, and nail techs. She’s quick to point out that they’re the reason members keep coming back. She says recognition should happen consistently at the franchise level, where culture is lived out every day. Ultimately, she measures success less by headlines and more by the strength of her team. If the people around her are inspired, ambitious, and focused, she expects the results to follow. As Head to Toe Brands continues to grow, Roberts makes it clear the company isn’t chasing the spotlight. It’s chasing excellence, letting the work and the franchisees who deliver it every day speak for themselves.

LEADERSHIP

Describe your leadership style: Firm, fair, and friendly. What has inspired your leadership style? My father’s leadership style was formed by his service in the military. He always said, “Officers eat last.” Essentially, always be serving others first. What is your biggest leadership challenge? Resisting the temptation to jump in and rescue.

MEG ROBERTS

CEO

Company: Head to Toe Brands Units: 130 The Lash Lounge, 40 Bishops Cuts & Color, 26 Frenchies Modern Nail Care, 1 Delta Crown Extensions Age: 53 Years in franchising: 19 Years in current position: 2

12 | Franchise Update | Issue 2, 2026

eg Roberts welcomes the challenges that come with being a CEO. Whether it’s building strong teams, driving brand growth, or demanding operational excellence, Roberts embraces it. She led Molly Maid for more than a decade before being named CEO of The Lash Lounge in August 2018. She oversaw the membership-based beauty concept that specializes in custom lash and brow services until it was acquired by Head to Toe Brands in spring 2024. The private investment-backed Head to Toe Brands then tapped Roberts to lead all of its brands, including The Lash Lounge, Bishops Cuts & Color, Frenchies Modern Nail Care, and Delta Crown Extensions. For the past couple of years, Roberts has led the multi-brand platform, guiding strategic growth, brand integration, franchisee support systems, and expansion into new markets. Today, the four brands combined make up a portfolio that is just shy of 200 locations.

How do you transmit your culture from your office to frontline employees? At HTT, we make it a point to celebrate and acknowledge our frontline experts from lash artists to stylists. Their skills are what keep our members coming back. While we have annual awards and recognition, we believe the real value is in helping our franchisees appreciate, recognize, and honor their teams on a regular basis. How can a CEO help their CMO develop and grow? My original aspiration was to be a CMO, but seeing the level of creativity required of ours (Erica Upshur), I can see and appreciate that I would not be successful! Our CMO brings the creativity. My role is to make sure that creativity drives real business results. Franchise marketing requires the best talent: being able to make magic without millions! Where is the best place to prepare for leadership: an MBA school or OTJ? 110% OTJ. But this assumes you have good leaders to emulate. I was lucky. I worked for some of the best, including Mary Kennedy Thompson. Working for her is like getting a Harvard MBA! Are tough decisions best taken by one person? How do you make tough decisions? I prefer to own the tough decisions. That’s not to say I don’t make them with my senior leadership team, but at the end of the day, I will own the fallout.

CEO Profile—Meg Roberts Do you want to be liked or respected? It may be a cop-out to say both, but picking one just feels dishonest. That said, I’m okay if someone doesn’t like me, but respect is required. Advice to CEO wannabes: Consider carefully your ability to endure difficult times and be certain your motivation, at least in franchising, is the calling to serve.

MANAGEMENT

Describe your management style: Stay informed, empower proven leaders, focus on growth, and eliminate distractions.

Are commodity/supply costs any cause for concern in your system? Not specifically. But there’s no doubt the uncertainty of tariffs continues to be an annoyance and a distraction no business can afford. In what ways are political/global issues impacting the market and your brand? Just as franchisees appreciate clear communication, so does the general public, including future franchisees, employees, and consumers. Mixed messaging doesn’t help anyone or any business.

TECHNOLOGY

What does your management team look like? My management team looks like a group of close friends at a big table in the back of a bar, solving problems and using the menu as a whiteboard.

How much influence does your IT department have on your brand? Technology should be at the core of all strategic planning: what’s working, what’s needed, and what can we imagine!

How does your management team help you lead? By reminding me when I’m not following my own rules, keeping them informed, or providing autonomy.

How have your company’s tech tools changed over the past five years? Just about every aspect of our technology has evolved over the past five years: what we use, how we use it, and how much more we rely on it.

Favorite management gurus: Do you read management books? I do not read management books. That’s not where I find my inspiration. I prefer podcasts about leadership, problemsolving, and everyday business. “Business Wars” is my favorite. What makes you say, “Yes, now that’s why I do what I do!”? When a former franchisee calls to tell me they earned their citizenship, and I’m the first person they called.

OPERATIONS

What trends are you seeing with consumer spending habits in your stores? Our members are more dedicated than ever. Beauty and wellness don’t go out of style, but our members do want, and deserve, new styles and technologies. We are prepared to provide it. How is the economy driving consumer behavior in your system? Consumer Index reports can be unnerving even when positive for beauty and wellness because broadly they are a sign of confidence or otherwise. While we don’t see membership declines, we have experienced some shift in new customer behavior, which suggests that providing value is all the more critical when consumers are more wallet aware. Are your franchisees bullish or bearish about growth and adding additional units? Head to Toe is bullish about the beauty industry, and each of our brands uniquely addresses a consumer’s need for luxury and quality. We expect The Lash Lounge to assume the premier position of leadership within the industry of lash extensions as we’ve proven and maintained our reputation. Frenchies is growing like wildfire as more people pursue clean manicures in a pristine studio, and Bishops is having a glow-up, revitalized and ready for coast-to-coast expansion. Finally, our newest brand, Delta Crown Extensions, is hitting the scene like a new Hollywood star. This brand is born for success!

How does technology influence your decisions? Emerging technologies are essential to success but must be balanced with thoughtful planning. Tech benefits are often obvious, but great technology can fail without consideration for end users. New tech must be integrated thoughtfully and acknowledge adoption fear and fatigue. Are you using AI? How? Yes. Everywhere in franchise development, marketing, operations, and communications. There isn’t a facet of our business that can’t be improved or made more efficient with AI. How do you measure your ROI on technology investments? There are too many variables to answer this succinctly, but let’s use an example that matters most: asking franchisees to spend more on a tech fee. Franchisors need to demonstrate the ROI of a specific tool (e.g., LMS training system) where a monthly fee will provide greater access to education, expediting trainees onto the floor. It reduces overtime costs, and clients spend less time waiting for an in-person visit.

Last two books read: Let Them by Mel Robbins (gift from a colleague), and I read The Onion regularly because we all need a little escape from reality, and it’s hilarious. W hat technolog y do you ta ke on the road? Laptop. How do you relax/balance life and work? It’s difficult, but I escape by literally and figuratively walking away. Get outside, walk around the block, try to take out your earbuds, and just listen to the world. Favorite vacation destination: Sullivan’s Island, South Carolina. Favorite occasions to send employees notes: For no reason at all, just because. Favorite company product/service: Of course, my own companies’ services. I love them all. Once you get a Frenchies manicure or a set of perfect lash extensions, it’s impossible to ever consider anything less. But right now, I’m hooked on the Delta Crown hair extension experience. It’s a game changer. Outside of my own, I’m a huge fan of Ariat cowboy boots. They’re my go-to look, dressed up or down, suit or jeans. They work with everything.

BOTTOM LINE

What are your long-term goals for the company? For each of our brands to set the standard for service, luxury, and opportunity in the beauty space and for our franchisees to enjoy the success and rewards of our shared efforts. How has the economy changed your goals for your company? My outlook is always optimistic. I was born “glass half full,” so we press on and through whatever the economy brings. Hard times lead to creative thinking and the rise of the best ideas. Where can capital be found these days? Capital is still in the same reliable sources: the SBA, local banks, and personal assets. When it’s harder to come by, it is incumbent on franchisors to have an even more compelling proposition and more robust support. We need to provide even greater confidence in the future franchisee.

How did/do you create a culture where use of technology advancements is welcome and used? Always a work in progress as people are different. Some embrace change quickly, and others take time. Ultimately, watching others succeed is the best way to create a culture of adoption.

How do you measure success? Success in my position equates to having a team that is inspired, ambitious, and focused. With a team that embodies these traits, the results will follow.

PERSONAL

Any regrets? Of course. Not listening to my gut earlier in my career. I trust my instincts a lot more now.

What time do you like to be at your desk? 8 a.m. Exercise in the morning? Wine with lunch? Never and never. Do you socialize with your team after work/ outside the office? Yes. A great deal. I’m lucky to have worked with some of my teammates for nearly 20 years! We have a lot of laughs together and enjoy practical jokes.

What has been your greatest success? Assembling that team!

What can we expect from your company in the next 12 to 18 months? Head to Toe doesn’t seek the spotlight. We are ambitious, bullish, and confident in our growth plans, but we let our customers speak for our success. We are enormously proud of what our franchisees and their incredible professionals do every day to deliver the goods. You can expect more of that!

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Issue 2, 2026 | Franchise Update | 13

Scott Taylor “I love building a team, and when it’s right, it’s right.”

Inclusive but Disruptive Teams need dreamers, thinkers, and doers—not validators Written by KERRY PIPES

little over a year into his role leading R&R Brands, Scott Taylor brings the energy of a hands-on operator, the mindset of a builder, and the personality of someone who enjoys being in the middle of the action. The 62-year-old, who has 25 years of franchising experience, oversees a 90-unit multi-brand portfolio that includes Party Fowl, Cody’s Original Roadhouse, Santa Fe Cattle Co., and Celebrity Theatres. R&R is also the largest franchisee of Walk-On’s Sports Bistreaux, giving Taylor a perspective that blends both ownership and system-level leadership. Before taking the helm at R&R Brands, Taylor built a deep résumé as a proven restaurant and franchising executive. Taylor spent 13 years at Walk-On’s Sports Bistreaux (2010–2023), first as president and chief operating officer before later transitioning into the CEO role. During his tenure as president and COO, he helped bring structure and systemization to the organization, built out the leadership team, and played a key role in launching the brand’s franchise program in 2014. Prior to Walk-On’s, Taylor served as COO of Family Sports Concepts, the franchisor behind Beef O’ Brady’s, where he helped drive significant growth and expansion.

SCOTT TAYLOR

CEO

Company: R&R Brands (Party Fowl, Cody’s Original Roadhouse, Santa Fe Cattle Co., Celebrity Theatres. As a franchisee, Walk-On’s Sports Bistreaux) Units: 90 Age: 62 Years in franchising: 25 Years in current position: 1

14 | Franchise Update | Issue 2, 2026

Taylor describes his leadership style as “inclusive but disruptive,” and he has little patience for “followers and validators.” Instead, he wants decision-makers. He runs what he calls the 20/80 rule—his leaders own 80% of the decision-making responsibility, and his role is to contribute the remaining 20% through insight, support, and resources before stepping aside to let the team execute. It’s a philosophy rooted in empowerment and accountability. He says strong organizations are built by surrounding dreamers with thinkers and doers. As R&R Brands grows, Taylor’s strategy is rooted in practical execution. He believes today’s restaurant market is a flat playing field, and the brands that win will be the ones that deliver true value not necessarily through price, but through experience.

He says R&R is focused on supporting second and third-generation restaurant spaces, keeping conversions efficient, and avoiding unnecessary overspending. At the same time, he’s pushing hard on technology, especially AI and consumer convenience. He says the ROI of AI doesn’t fit traditional models, but he sees tech as a long-term advantage that brands ignore at their own risk. “You’d be silly not to embrace tech,” he says. When asked about how he measures success, Taylor points to low turnover, high franchisee and team satisfaction, and a strong bottom line as the natural result.

LEADERSHIP

What is your role as CEO? I lead a multi-brand platform of full-service and fast-casual brands that we either own, operate, license, or franchise. We are also the largest franchisee for Walk-Ons Sports Bistreaux. How has Covid-19 affected the way you have led your brand? As the president of Walk-On’s during the pandemic shutdown and recovery, I made it my mission and purpose to engage with my franchisees and corporate team on a daily basis. I worked to provide updates and insights along with a combination of grace, humor, and prayer. It was a different time. I will embrace that time. In many ways, Covid happened for us, not to us, and changed how we all value personal/business relationships. Describe your leadership style: Inclusive but disruptive. I do not like followers and validators. My role is to empower. I work the 20/80 rule. You’re the decision-maker, 80%. My job, 20%, is to provide insight and support, offering anything and everything for the success of the team before getting out of the way. What has inspired your leadership style? I never planned to run a restaurant company, much less have a career in the restaurant industry. I am inspired by dreamers, but you also have to surround dreamers with thinkers and doers. I love building a team, and when it’s right, it’s right. What is your biggest leadership challenge? Progress versus perfection: I preach this to my teams, but I don’t always live the message. I ground my thinking when meeting with young leaders and listening to their vision. I am fortunate to teach a hospitality course at the University of Florida. This is often my place for a reset. How do you transmit your culture from your office to frontline employees? Culture is all about purpose, vision/heart, and a servant mindset. That sounds very philosophical, but it’s about knowing who you serve and serving them well.

CEO Profile—Scott Taylor The office staff is in place to make the field team successful. This mindset has to translate through all levels of the organization after it leaves the corporate office. How can a CEO help their CMO develop and grow? The CMO role is a pressure point in so many organizations. I think it’s helping to create a flow of data that drives decision-making to its highest level but doesn’t stifle creativity and risk-taking. A great and successful CMO takes risks but has the backing of solid data that justifies the risks. Exterminate analysis paralysis but also never let ego get hold. Where is the best place to prepare for leadership: an MBA school or OTJ? On the job—all day, every day. That said, find a way to engage with college students. They are an incredible hybrid of society, immersed in higher learning, shedding the opinions/prejudices of their parents, and forming their own ideas. Spend time, or even teach a class, and get the unvarnished truth from the next generation. Are tough decisions best taken by one person? How do you make tough decisions? Big decisions are best contemplated and weighed with the input of all stakeholders. That said, the final decision falls to the decision-maker. Some say it’s a lonely place, and it is if you have been alone on the journey. Do you want to be liked or respected? Of course, I want to be liked. I think being truly liked is a by-product of being respected. It’s a funny question, but I think about people I know who are fun to be around, but I wouldn’t necessarily have a real conversation with them. Advice to CEO wannabes: If you are chasing that, then that is a rough and disappointingly long race. Being at the top of the chain is great, but a CEO is only successful because of the contributions made by people from throughout the organization. If you become a CEO one day, start looking at who could be your replacement as you build/manage your team.

MANAGEMENT

Describe your management style: Get after it. Everyone is all in and all aligned on the win. I like to engage one-on-one and chat it up about how we can celebrate a win or do something better. What does your management team look like? It is hopefully loaded with different thinkers who are 100% aligned on the vision, mission, and purpose but not the process of how we get there. How does your management team help you lead? They own their stuff and collaborate. I am nothing without a dedicated team around me. Favorite management gurus: Do you read management books? I’ve read a bunch, so I have many great quotes and mantras, but I’m just wideeyed and watching, listening, and learning. What makes you say, “Yes, now that’s why I do what I do!”? From a customer perspective, it’s

hearing them say, “Oh yeah, we’re coming back here.” From a teammate/co-worker standpoint, I love seeing real excitement in individuals who are doing what they love, seeing the impact, and experiencing momentum under their own control.

OPERATIONS

What trends are you seeing with consumer spending habits in your stores? Value but not in price. I’m old school: product + experience/ price = value. The restaurant business is on a flat playing field right now; full service can sweep the gold if we can reinspire our workforce. How is the economy driving consumer behavior in your system? The economy is always impacting our business; you can’t get fat when the money is flowing and wonder why you’re struggling when it’s not. I’m focused on the impact of Ozempic and the eating habits of millions of Americans. For the first time in history, probably, people are on a “needle” diet: They are losing weight and no longer concerned about healthy options. They are more about indulgent and delicious smaller portions. What are you expecting from your market in the next 12 months? Skeptics and opportunistic, money-minded people. We just have to stick to what we do. Are your franchisees bullish or bearish about growth and adding additional units? We have a strong focus on second and third-generation space and simplifying brand elements. We don’t have to overthink/overspend on a conversion. Are commodity/supply costs any cause for concern in your system? Always. That’s why you have to focus on solid menu planning and strategic LTOs. In what ways are political/global issues impacting the market and your brand? Who knows?

TECHNOLOGY

How much influence does your IT department have on your brand? We are pushing them to get us in front of what’s coming next. AI and consumer convenience are at the forefront. How have your company’s tech tools changed over the past five years? It’s an ongoing process. How does technology influence your decisions? It plays a role in most of my decisions. Are you using AI? How? Yes. We are using what is on the market now. We are also partnering with tech groups to take a leadership role in what’s to come. How do you measure your ROI on technology investments? That’s a long-term play; the ROI doesn’t fit traditional models. How did/do you create a culture where use of technology advancements is welcome and used? The culture is there; it’s yours to reject.

PERSONAL

What time do you like to be at your desk? I don’t really have one. When I get to our home office, there are always great snacks and San Pellegrino. I tend to wander and sit across from other people’s desks. Exercise in the morning? Wine with lunch? Yes on exercise when I can, and no on wine with lunch unless it’s chill time. Do you socialize with your team after work/ outside the office? Not really, but I travel between multiple offices. I work very closely and intensely with my teams. We probably collectively need “a minute” away, but I’d love social time when it’s appropriate. Last two books read: Dune because I argued with my daughter about the ending. The Coffee Bean: A Simple Lesson to Create Positive Change by Jon Gordon and Damon West. I met Damon West several years ago. It’s just a great message and positive thinking. What technology do you take on the road? My iPhone and a laptop. How do you relax/balance life and work? I am so bad at doing what I beg everyone else to do, but my wife and I have our unplug time, cuddle with puppies, and call our kids. Favorite vacation destination(s): Hawaii and the Amalfi Coast of Italy. Favorite occasions to send employees notes: Just because. Birthdays, etc., are predictable. I love to find a reason to surprise and delight. I love to just find a way to send a “that was freakin’ awesome” note that no one expected. Favorite company product/service: I hate to say it, but Amazon. The company has just got it, and someone should get after it.

BOTTOM LINE

What are your long-term goals for the company? Too many ways to define and not enough room. How has the economy changed your goals for your company? We have had to adapt. Where can capital be found these days? Anywhere and everywhere if you have a plan, a great differentiated product, and a team ready to execute. How do you measure success? Wicked-low turnover, franchisee/team satisfaction (#1), and, presumably, a strong bottom line. What has been your greatest success? I outkicked my coverage in 1991, marrying Michelle Christine Cook—35 years later . Any regrets? Things happen for a reason. No one gets screwed over or missed. I believe everyone is on the path they have put themselves on; mine has been just fine. What can we expect from your company in the next 12 to 18 months? #SecretStuff.

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Issue 2, 2026 | Franchise Update | 15

THE EXIT PLAN Resale programs protect stores, franchisees, and system growth Written by COLLEEN MCMILLAR

16 | Franchise Update | Issue 2, 2026

The Exit Plan

t wasn’t that long ago that Pete Baldine would take the podium at a franchising conference, begin to talk about the importance of having an effective franchise resale program, and meet a room full of blank stares. The looks on the faces of some brand representatives weren’t necessarily due to a lack of interest; they were expressions of genuine puzzlement. At the time, “franchisors weren’t very involved in resales,” says Baldine, president of Moran Family of Brands, which specializes in the automotive aftermarket industry with nearly 200 locations of Mr. Transmission, Milex Complete Auto Care, Turbo Tint, Mister Transmission of Canada, and others. “I would say a lot of the attitude was, ‘If a franchisee wants to sell, we just tell them to list it with a local broker, and it’s their responsibility to get it sold. We just have to approve the candidate,’” Baldine says. However, he warned his fellow franchisors against such a passive approach. “There are a lot of pitfalls in that lack of strategy,” he says. If anything, the team at Moran Family of Brands has learned there’s a huge upside when franchisors are proactively involved in ownership transfers. Franchisees exit franchise systems for a host of reasons. They retire, get sick, or have other changes in their personal lives. For franchisors, the North Star is preventing disruptions. Resale programs help facilitate seamless ownership transfers, which can prevent business closures, protect revenue streams, and maintain customer relationships. Well-managed exits are essential to franchisors’ long-term stability, growth, and enterprise value. Moran Family of Brands instituted its resale program two decades ago. Today, roughly 60% of franchises have formal resale programs, according to a 2024 survey by Franchise Update Media. When franchisors help connect sellers and buyers and stay actively involved in the process, everybody wins, Baldine says.

Pete Baldine President Moran Family of Brands Left unmonitored, some franchisees might decide not to renew their lease and simply shut down, Baldine says. Moran Family of Brands keeps tabs on which franchise agreements are about to expire and contacts franchisees at least a year in advance to inquire about their plans. If the franchisee wants to sell, the company sends them a resale package. Then, Moran Family of Brands basically does what a local business broker would do. The franchisee signs a listing agreement with the company. “We analyze their financial statements and tax returns, and we advise them, based on their financial performance, about the range that we believe they can sell the business for,” Baldine says. “It’s up to them to actually place the final value on it, but we help them with that process. We use the same valuation formulas that the Small Business Administration is going to use to value the business. That helps tremendously when the buyer goes to the SBA to get funded.”

STAYING OPEN

The company vets potential buyers to make sure they are well qualified and a good fit for the network’s culture. The franchisor then helps negotiate the deal. “We go to the closing to make sure that there’s a smooth transition,” Baldine says. From there, the new buyer goes through training set up by the company.

“If you don’t have a resale program in a system like that, where franchisees are aging out, then you’re going to lose stores,” Baldine says. “Everybody talks about how many new ones you’ve opened. But in an older system, your resales can be just as important as your new sales.”

With a resale program, “you have the opportunity, as the franchisor, to bring in a new franchisee, and you’re able to keep the store open,” Baldine says. “You’re also helping your franchisee. Over the course of their agreement, they built equity in that business. Sometimes, they don’t know how to get that equity out. As the franchisor, when you get involved in that process, you’re helping your franchisee get the equity out that they worked so hard to build. At the same time, you’re saving the revenue stream for you as the franchisor.”

Moran Family of Brands got its start in 1990. Roughly 30% of its franchisees have been in the system for 20 years or more, and 16% have been in the network for 30 years or more. Over the decades, the company’s resale program has been beefed up to meet the needs of its franchise owners.

Some franchisees don’t have a succession plan or an exit strategy. They don’t know where to begin when it comes to selling their business.

Issue 2, 2026 | Franchise Update | 17

The Exit Plan A successful resale program can be a key selling point for potential franchisees who are on the fence. Many candidates have questions: How do I get out of the franchise if I want to? What if the business isn’t going well? What if something happens and I need to move?

“When candidates step into a system with existing cash-flowing assets, they gain real visibility into what’s possible,” she says. “There’s history there: established brand presence, operating data, community trust. And that foundation materially reduces uncertainty.

“All those questions get asked because they want to know how they exit. And, if the franchisor doesn’t have a strong resale program and the ability to help them exit, then they’re less likely to move forward. That’s why I talk to candidates on discovery day about our resale process,” Baldine says. “I want the franchisee to understand that whole life cycle. Get in, build your business, grow your business, your money, and then count on the fact that your franchisor has a solid resale program to help you exit the business when you decide it’s your time.”

“In our system, we have brands with deep roots, long-standing customer loyalty, and proven performance,” she continues. “That combination of brand equity and existing cash flow is a powerful differentiator. It’s a meaningful advantage for franchisees evaluating growth, expansion, or entry into the platform.” Recently, Unleashed launched a retooled resale program that supports franchisees in all of its seven brands. Franchise operators are made aware when existing units in the portfolio are about to go on the market. “Having clear visibility into actionable opportunities already within the system has been a significant advantage,” Dosch says. “I’m frequently asked by an existing owner what else may be available for acquisition, whether within their brand or across another concept. That transparency creates a pathway for multiunit, multi-brand growth, in our case, all within the same ecosystem, shared infrastructure, and trusted platform.”

Paige Robinson Dosch VP of Franchise Sales Unleashed Brands

NEW FRANCHISEES

Unleashed Brands is a youth enrichment franchise platform with a portfolio made up of Urban Air Adventure Park, The Little Gym, Sylvan Learning, Snapology, Class 101, Premier Martial Arts, and Water Wings Swim School. With 1,400 locations and seven brands, turnover is inevitable as it is in all franchise systems.

While franchise resale programs aren’t new, they are becoming more of a focus for franchisors in this economic climate. “We’re in a unique timeline where understanding exactly how a business performs becomes very important to the investor, to the lender, and to the franchisor,” Dosch says. “Everyone wants to focus on how many units you awarded and how many units you’re opening, but let’s not forget that the existing unit health is paramount to the health of the organization.”

CONNECTIVE TISSUE

Firehouse Subs was founded by a pair of brothers, Chris and Robin Sorensen, in 1994. A year later, it became a franchise and now has nearly 1,500 locations across the U.S. and Canada. The brand has a

“The difference is whether that turnover is handled strategically or left to chance,” says Paige Robinson Dosch, vice president of franchise resales.

18 | Franchise Update | Issue 2, 2026

robust resale system in place to help franchisees who are looking to exit the system. “There are different reasons franchisees would decide to sell or transition out. We’re happy to help the existing franchisees transition out and also welcome the new franchisees and help them to be successful,” says Theo Camurca, vice president of operations. When it comes to resale programs, there are good ones, and there are great ones, says Abhi Patro, director of franchising. What sets Firehouse Subs’ program apart, he adds, is its transparent process, strong cross-functional collaboration, diligence, and dedicated onboarding team for new buyers. “Typically, in resale transactions, several different internal and external parties are involved,” Patro says. “It’s not just the buyer and the seller. You’ve got lenders, vendors, attorneys, landlords, operations, finance, real estate, training, onboarding. The existence of a function that acts as a focal point and the connective tissue across all of these different entities and closely collaborates with field operations is what makes a seamless ownership change.” Firehouse Subs’ business development team is always on the lookout for new buyers, using brokers, referrals, and conferences to fish for leads. Both of Firehouse Subs’ founders were firefighters. The franchise offers financial incentives to attract first responders and military veterans, Camurca says. “They’re normally very disciplined, very methodical, and normally turn into great operators. So, this is definitely a natural fit for us,” he says.

A formal resale program “protects the enterprise value of the franchisor while simultaneously building and preserving value for franchisees,” she says. “It creates structure, continuity, and transparency as assets change hands.” That structure can smooth the path for new franchisees. Resales offer financial visibility. That can make buying established units, especially those with track records that can be pored over, an attractive option for investors. It’s often a differentiator, Dosch says.

Abhi Patro Director of Franchising Firehouse Subs

Theo Camurca VP of Operations Firehouse Subs

For current franchisees interested in expanding, the brand conducts rigorous analyses of their existing businesses to make sure they aren’t biting off more than they can chew, operationally and financially, Patro says. If the buyer needs an SBA loan, the franchisor is there to assist in the process. Training on franchise operations is provided for new buyers.

The Exit Plan “Any successful franchise resale program will have a roster of partnerships at your disposal and resources,” Patro says, “whether it’s a list of financial lenders with preferred terms to fund your purchase, brokers if you want to sell your business, thirdparty vendors offering valuation support to help you come up with a target sale price, a training and onboarding team, or a real estate team. We have a dedicated real estate team that is really involved with reviewing lease assignments and helping buyers with conversations with landlords.”

It’s not just about the financials, Lassen says. “A lot of the sellers want to make sure that the buyers who come in represent what they’ve established in the community and don’t take it for granted,” he says. “Once they find a good candidate, we evaluate them just as we would any new prospect. We take them through our discovery process to ensure they align with our values and our mission, that they’re a good fit, and that they have a strong understanding of the community they’re looking to purchase in.”

Once the deal is buttoned up, a representative from Firehouse’s field operations team will be on hand to oversee the handover of the keys and communicate with employees, Patro says. Firehouse’s process is meant to ensure that the transaction is the right move for the franchise, the seller, and the buyer, he says.

Preventing a restaurant closure doesn’t just protect the brand’s bottom line. It protects Steak ’n Shake’s image as well. “For the franchisor, a lot of this comes down to perception on the sales side. We don’t want our franchisees to just simply close their stores. Customers may not realize the owner has been there for 40 years and is looking to retire. If they see a closed door, the perception becomes, ‘Maybe the business isn’t doing well’ or ‘Maybe the brand isn’t doing well.’” Steak ’n Shake has a long history with its franchisees, but Lassen says resale programs aren’t just important for mature brands. “As a newer brand, franchisors need to look at this a little bit differently. What they’re selling isn’t just what they currently do,” he says. “They’re also selling a prospective franchisee, coming on board, a way to retire.” That forethought is something that is helping to attract a new generation of Steak ’n Shake franchisees.

Michael Lassen VP of Franchise Sales Steak ’n Shake “We’re working very diligently to make sure that the process moves through not just smoothly, but also in a fast and high-quality way,” Patro says.

BRAND IMAGE

Steak ’n Shake has been in existence for almost a century. As a brand, it has changed with the times and continues to modernize. The same can be said of its franchise resale program. Michael Lassen, vice president of franchise sales, grew up with Steak ’n Shake always in the background in Springfield, Missouri. It’s a legacy brand, so some franchisees have been in the system for up to 40 years. Some have handed off their businesses to their children, who are now nearing retirement themselves. “We want to make sure that they have a good exit strategy,” Lassen says. Franchisees want to feel like their franchisors have their backs, he says. “They want to know that we’re here not just at the beginning, but also when they’re looking to exit,” he says. “We can assist them by creating different avenues and marketing strategies to help them find a buyer for their store.” 20 | Franchise Update | Issue 2, 2026

“A lot of the sellers want to make sure that the buyers who come in represent what they’ve established in the community and don’t take it for granted.” —Michael Lassen “We’re a legacy brand, but we’re repositioning it as a legacy brand that’s coming back,” Lassen says. “That’s very exciting for younger clientele and younger portfolio buyers. When we look at resales, we speak with individuals who grew up in the brand, but we also talk to people who aren’t as familiar with Steak ’n Shake and say, ‘We love what you’re doing. We love the product. We want to be part of it.’ It’s exciting to see.”

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KEY TAKEAWAYS • Franchise resales are becoming a strategic priority. About 60% of franchise systems now have formal resale programs, reflecting growing recognition of their role in system stability. • Active franchisor involvement prevents store closures. When franchisors guide ownership transitions, they help keep locations open and protect system revenue. • Resale programs protect franchisee equity. Structured support helps franchisees unlock the value they’ve built in their businesses when they’re ready to exit. • Aging franchise networks make resales inevitable. Mature systems with long-tenured operators must plan for ownership transitions as franchisees retire or move on. • Existing units can attract new franchise investors. Cash-flowing locations with operating histories provide financial transparency and reduce risk for buyers.

• Resales can fuel multi-unit expansion. Visibility into available units allows existing operators to grow within the system or across multiple brands. • Cross-functional coordination is critical. Successful programs align lenders, brokers, legal teams, landlords, training, and operations to ensure smooth transitions. • Strong resale systems strengthen franchise development. Prospective franchisees want to understand the full life cycle, including how they can exit the business later. • Ownership transitions protect brand reputation. Preventing store closures avoids negative signals to customers, investors, and future franchise candidates. • Resale planning supports long-term enterprise value. Franchisors that manage ownership changes strategically can maintain system growth while safeguarding brand equity.

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IFA Report

Resilient by Design

Franchising is poised for growth amid uncertainty Written by MATT HALLER

ven in an era marked by challenging headwinds—lingering inflation, high borrowing rates, and an unpredictable regulatory climate—the franchise community has not only survived, but thrived. As we gathered in Las Vegas at the 2026 IFA Annual Convention under the theme of Evolve, IFA members representing all aspects of the franchise model shared this sentiment of enthusiasm for what’s ahead following a year of adjustment and recalibration. As we look ahead, it’s clear that franchising is better positioned to navigate an improving economic environment than independent businesses, and that’s no accident. It’s a testament to our model and the people and policies that power it. According to IFA’s “2026 Franchising Economic Outlook,” franchising’s economic output is projected to rise by 1.6% this year. Our forecast predicts an increase of franchise units from 832,521 to 845,000 units, an uptick of 1.5%. Franchise employment is anticipated to grow by more than 150,000 jobs (1.8%) to nearly 8.9 million jobs. These are more than just numbers or statistics; they are proof points of the inherent strength of franchising. Our model empowers individuals to become small business owners with the backing of proven systems. Franchisees benefit from established brands with trusted playbooks and peer networks that mitigate risks and increase opportunities. While franchising is often associated with fast food, child services and commercial and residential services are expected to be the fastest growing industries in 2026, both expanding at respective rates of 3.2%. The increase in child services has been fueled by the rise of dual-income households and more awareness of the importance of early childhood education. Growth in residential services is attributed to an uptick in repairs and maintenance, lawn care, and pest control. Those trends are expected to continue upward as homeownership increases amid further expected interest rate cuts from the Federal Reserve. This year, the health and wellness industry’s upward trajectory is expected to continue at an above-average growth rate of 2.1%. Since the Covid-19 pandemic, consumer focus on preventive 22 | Franchise Update | Issue 2, 2026

healthcare and overall wellness has propelled the sector to become the third-largest franchise industry, a trend poised to accelerate with the interest in healthier living. For the first time since the pandemic, full-service restaurants are expected to outpace quick-service restaurants (QSR) in growth. Among QSR, consumer preferences are shifting toward “experiential dining” rather than purely value-driven offerings. Similarly, in the lodging industry, high-income consumers are expected to continue spending on personalized and experiential luxury travel. IFA’s forecast also illustrates how franchise establishments play an increasingly important role in creating labor demand for young people entering the workforce. With youth unemployment at 10.4% in 2025, which is more than double the national average, franchise establishments offer opportunities and open doors to those beginning their professional journeys. IFA’s economic outlook illustrates the importance of sound policies that support our model. Business-friendly policies and lower costs of living have fueled population growth in the Southeast and Southwest, which are expected to maintain their positions as the top regions for franchise expansion at 1.7% and 2.5%, respectively. Nationwide, the top

10 fastest-growing states for franchising in 2026 are Texas, Florida, Georgia, Arizona, North Carolina, Colorado, Michigan, Utah, Ohio, and Maryland. With relative affordability and potential for expansion, Michigan, Ohio, and Utah have emerged as newcomers on the top 10 list, and we look forward to their continued growth. Other green shoots in the franchise economy include key provisions in last year’s budget reconciliation bill, especially the permanence of the Section 199A qualified business income deduction and 100% bonus depreciation, taking hold. The long-term certainty on these and other tax issues was a result of many months of IFA advocacy and support from the franchise community. IFA continues its laser-like focus on the bipartisan American Franchise Act, which will codify a clear federal joint-employer definition and end the decade-long regulatory whiplash, bringing even greater growth and certainty to the business model. Since the bill’s introduction last fall, IFA has led this charge on Capitol Hill, engaging lawmakers and highlighting franchising’s role in job creation and economic mobility. In 2026, the measure gained the endorsement of the bipartisan Problem Solvers Caucus and now has more than 80 cosponsors in the U.S. House. Looking ahead, franchising’s future remains bright. As economic uncertainties evolve, our model’s blend of independence and support will keep us ahead. If 2025 was a year of recalibration for franchises, 2026 should be marked by steady and consistent brand growth, franchisee unit-level economics, and wage growth. We’re excited for what the future holds.

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Matt Haller is president and CEO of the International Franchise Association.

UPCOMING IFA EVENTS 2026

INTERNATIONAL FRANCHISE SHOW - LONDON April 17-18, 2026 | London, England Partnership event with Business Show Media

IFA LEGAL SYMPOSIUM

May 17-19, 2026 | Washington, DC

IBA/IFA JOINT CONFERENCE May 19-20, 2026 | Washington, DC

FRANCHISE CUSTOMER EXPERIENCE CONFERENCE June 2-4, 2026 | Atlanta, GA

IFA ADVOCACY SUMMIT

Sept. 14-16, 2026 | Washington, DC

THE IFA WORLD FRANCHISE SHOW

Sept. 25-26, 2026 | Ft. Lauderdale, FL Partnership event with Business Show Media

FRANCHISE LEADERSHIP AND DEVELOPMENT CONFERENCE October 6-8, 2026 | Atlanta, GA

EMERGING FRANCHISOR CONFERENCE November 16-18, 2026 | Nashville, TN

Scan here to learn more about these events and plan your year with IFA!

franchise.org/events

HOLDING

Line

the

Brands keep customer experience consistent as they grow Written by M. SCOTT MORRIS

24 | Franchise Update | Issue 2, 2026

Customer Experience

n Handyman Connection offices across North America, a poster hanging on the wall outlines the brand’s purpose, vision, strategy, and core values. It reminds franchisees, craftsmen, and customer service representatives that their overarching goal is to serve customers in ways that build long-term relationships. Angelique McMillan, the brand’s vice president of marketing, says that the document was crafted word by word by a group of franchise owners known as brand champions, operators who gathered to define what the Handyman Connection experience should look like in the field. “We felt like we would get more buy-in if it came not only from the home office, but really from our franchisees as well,” says McMillan, who has a copy of the poster hanging in her office. That buy-in is critical. In franchising, customer experience standards may originate at headquarters, but they’re delivered locally by franchise owners and their team members who interact with customers every day. “Brand for us really is brand experience,” McMillan says.

As franchise systems grow, maintaining that consistency becomes increasingly difficult. New operators enter the system, locations scale, and teams expand, creating more opportunities for service standards to drift. Franchisors are responding by tightening training, tapping into performance data, and reinforcing the cultural expectations that define the brand experience.

CHALLENGES AT SCALE

What starts as a positive surge in demand can quickly expose weak spots in staffing, scheduling, and operational processes if the infrastructure supporting that growth hasn’t kept pace. “There’s some pain in that growth,” McMillan says. “You’re right at the cusp of maybe hiring a second CSR or needing an office manager, and you don’t have that yet.” During those transitional periods, even small breakdowns in communication or follow-through can affect how customers perceive the brand. A delayed response to an inquiry or a missed detail at the end of a job may seem minor on its own, but those moments can alter the overall experience customers take away from the interaction.

Angelique McMillan VP of Marketing Handyman Connection

Issue 2, 2026 | Franchise Update | 25

Customer Experience Brandy Ward, franchise advisor and sales and design director for Kitchen Tune-Up and Bath Tune-Up under Home Franchise Concepts, says growth can create pressure points throughout the customer journey when owners are stretched across too many responsibilities at once. “They might rush through a sales appointment, or they may not get back to a lead as quickly as they normally would,” Ward says. “It’s usually not intentional. It’s just that they’re wearing too many hats.” In home service businesses, those subtle changes can reshape key moments in the customer experience. “In our business, presenting the proposal in the home is a big part of the experience,” Ward says. “If someone feels too busy and sends it later instead, they’ve shortchanged that moment.” Roxanne Conrad, chief operating officer at Premium Service Brands, agreed that challenges appear across franchise systems when expansion begins to move faster than the systems designed to support it. “The biggest time things go off the rails is when growth outpaces infrastructure,” Conrad says. When that imbalance occurs, she says, the pressure to keep up with demand can lead owners to hire quickly without the usual vetting, pay higher vendor costs, or bypass established processes to keep jobs moving. “That’s when businesses can no longer deliver a consistent consumer experience,” Conrad says.

WATCHING THE SIGNALS

A single bad review or customer complaint may not signal much on its own. But when franchisors begin to see repeated signals across feedback channels or operational metrics, those patterns can reveal early signs that a location may be struggling. Handyman Connection relies on Net Promoter Score (NPS) surveys to track customer sentiment after each job, asking customers how likely they are to recommend the business to friends or family. The responses provide a consistent stream of information about how well the experience is landing at the local level and where it may be falling short. “We ask that ultimate question: How likely are they to refer us?” McMillan says. “And then we get the feedback behind it.” Sometimes customers mention pricing concerns or scheduling frustrations. Other times, the comments highlight breakdowns in basic service expectations. “We’ll see things like a craftsman didn’t clean up after the job,” McMillan says. “Those are indicators that we need to have a conversation and remind the team about what’s important in the experience.” At Premium Service Brands, Conrad says the earliest signals of trouble frequently appear in operational data before they show up in customer feedback. By aggregating information from CRM

Brandy Ward Franchise Advisor/Sales and Design Director Kitchen Tune-Up and Bath Tune-Up Home Franchise Concepts

systems, marketing vendors, and operational tools into centralized dashboards, the company monitors how individual locations perform across a wide range of metrics. “We see it in the data before we see it in anything else,” Conrad says. Those dashboards track lead volume, close rates, sales cycle length, marketing efficiency, and average job size. The data points can reveal when a location may be struggling to follow established processes or keep up with demand. When a franchisee’s numbers begin to drift from system-wide benchmarks, the data provides an opportunity to step in early and identify what may be causing the change. “Why is one owner’s close rate lower than another owner’s close rate?” Conrad says. “Why is it taking longer for them to complete a sale? Usually, something in the process isn’t being followed.” For franchisors, the goal is to use those signals as a coaching tool. The same dashboards that highlight potential weaknesses also help operators understand how their businesses compare to others in the system and where improvements can be made. “If everything is on track, we’re asking how we can accelerate growth,” Conrad says. “If something starts slipping, the data helps us identify where the breakdown is happening.” Another way franchisors monitor consistency is through structured compliance systems that track whether stores are following brand standards in their daily operations. Jennifer Dodd, CEO of Main Squeeze Juice Co., says she first saw the power of that approach as a teenager working at Wendy’s, where strict inspections reinforced the brand’s focus on quality, service, and cleanliness. Dodd spent part of that job standing outside the restaurant in a blue-and-white Wendy costume, complete with red wig and freckles, waving passing drivers into the store. The experience left a lasting impression. While Main Squeeze uses modern tools such as customer data analytics and AI-driven recruiting platforms, Dodd says the brand still relies on an old-fashioned, layered audit process to maintain consistency across locations. “If we don’t have that scoreboard, the players can’t check themselves, the leader, which is the franchisee, can’t check themselves, and the league, which is the franchisor, can’t see where people are on the field,” Dodd says. Main Squeeze’s scoreboard includes daily operational checklists, monthly self-audits, and additional reviews from the brand’s operations team. The company also uses video-based mystery shop visits to evaluate how the experience unfolds from the customer’s perspective, helping operators identify gaps and reinforce the brand standards that shape each guest interaction.

26 | Franchise Update | Issue 2, 2026

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BRANDS WE WORK WITH

Customer Experience COACHING THE FRONT LINES

According to Ward with Home Franchise Concepts, franchise systems often deliver the brand message across multiple channels to ensure owners and their teams remain aligned with home-office expectations. “We try to communicate as much as we possibly can,” Ward says. “We do podcasts, webinars, emails, and we have our Facebook group. We’re constantly trying to reinforce the message.”

Jennifer Dodd CEO Main Squeeze Juice Co.

Those efforts are designed to reach franchisees wherever they are most likely to engage, recognizing that operators are often juggling multiple responsibilities while running their businesses. Conventions, training events, and ongoing digital communication all serve as opportunities to reinforce the same principles in different ways. “I think we really try to lead from positive reinforcement,” she says. “We’re communicating what we praise, lifting up the people who are delivering on that brand promise, and making that visible to the rest of the system.” Data often demonstrates how strong customer experiences translate into measurable results. When franchisees follow established processes for lead response, sales consultations, and installation, those behaviors tend to correlate with higher close rates, stronger customer satisfaction, and more repeat business. “Look at what happens when these standards are followed,” Ward says. “They’re tied to your conversion, your revenue, your sales, your customer satisfaction.” The emphasis on coaching rather than punishment helps maintain the collaborative relationship that franchising depends on. When it comes to coaching franchisees, Ward says problems should be approached with empathy and curiosity, which often produce better outcomes than focusing on enforcement. “Usually, it’s not intentional,” she says. “Everyone wants to do well. We approach it with curiosity: Let’s understand what happened and how we can help avoid it in the future.”

TECHNOLOGY STEPS IN

While the fundamentals of good service still rely on people, franchisors are increasingly turning to AI and advanced analytics to support the systems that guide frontline interactions. Ward says that Home Franchise Concepts has introduced an AI tool that records sales conversations and analyzes them immediately after an appointment, giving franchisees detailed feedback about how the interaction unfolded. “When they leave that sales appointment, the recording goes through an AI sales coach,” Ward says. “It will immediately lay out the things that went really well and some of the things they should work on.” 28 | Franchise Update | Issue 2, 2026

The technology evaluates talk ratio, speaking pace, and how closely the conversation follows the brand’s established sales process. For franchisees, the tool provides a level of self-awareness that can be difficult to achieve during a live conversation with a customer. “When you’re in a sales call, there’s a lot going on,” Ward says. “You’re thinking about the customer, you’re thinking about the questions you need to ask, and you believe you did certain things. But when you listen back to the recording, sometimes those things didn’t actually happen.” The AI analysis becomes the starting point for a coaching conversation with a human sales coach, who reviews the call and works with the franchisee to refine the approach. “The biggest impact happens when the AI and the human coach work together,” she says. Premium Service Brands is exploring how AI can support operations across its platform. Conrad says the company created an internal AI task force in 2025 to identify opportunities where the technology could improve efficiency or strengthen the customer experience. “We built a list of the things every team would love AI to help with,” Conrad says. The group includes representatives from marketing, technology, finance, data analytics, and project

management, allowing the company to evaluate potential uses from multiple perspectives. Some of the first applications are designed to improve responsiveness when customers reach out for help. “We’ll have an AI agent that can handle calls after the call center closes or on holidays,” Conrad says. The company has also implemented AI-driven chat tools on its websites, allowing homeowners to ask questions about services and schedule appointments online without waiting to speak with a representative. “Millennials like to do things online,” Conrad says. “They don’t necessarily want to call and talk to someone. Being able to answer questions and get them booked right away has really improved our conversion.” At Main Squeeze Juice Co., Dodd says the company recently implemented a training and communications platform called Know that allows the brand to distribute learning modules and cultural messaging directly to employees across its locations. The system gives both the franchisor and franchisees the ability to push short training videos, brand updates, and hospitality-focused content to frontline staff while tracking who completes the material.

Customer Experience

Roxanne Conrad Chief Operating Officer Premium Service Brands

Key Takeaways • Customer experience begins with culture. Brands reinforce CX expectations through shared values and franchisee involvement in defining the brand experience. • Growth can expose operational weak spots. As franchise systems scale, staffing gaps, scheduling pressures, and overloaded operators can cause service consistency to drift.

“We wanted something that made it easy to update training and keep our teams aligned,” Dodd says. “But it also lets us share content that reinforces the culture we want in the stores.” The platform functions almost like an internal social channel, allowing leadership and franchise owners to distribute content that highlights service expectations and customer engagement. For Dodd, that combination of technology and messaging helps ensure that brand values remain visible to employees who ultimately deliver the customer experience. “You move toward what you expect and what you forecast,” she says. “It’s important that those expectations are always in front of the team.”

CHOOSING PARTNERS

For many franchisors, delivering a consistent customer experience also depends on helping franchisees attract and hire the right frontline employees. Dodd says her brand has introduced franchisees to a recruiting platform called Landed that guides applicants through an initial screening process that evaluates personality, work preferences, and alignment with the brand’s hospitality culture. The system isn’t mandatory, but Dodd says many operators have adopted it because it helps narrow the candidate pool before interviews begin. “We brought it to the table for our franchisees

as a recommendation,” Dodd says. “The stores that have used it have loved it.” The impact can show up quickly on the floor. Dodd recalled visiting a newly opened Main Squeeze Juice Co. location in Midland, Texas. “They were just outstanding team members, and they were not afraid to jump out from behind the counter and go to the juice cooler and talk to customers,” she says. Of course, a franchisor’s ultimate partners are franchisees. Even with strong systems, constant communication, and new technolog y, the foundation of customer experience begins with choosing the right prospects to join the brand. Candidates often move through multiple stages of conversations with leadership, operations teams, and existing franchisees before reaching a final decision. “We call it the dating cycle,” Conrad says. The goal is to make sure both sides understand what the partnership requires. Alignment matters because the franchisor can define the brand and build the systems that support it, but the experience customers ultimately remember is delivered one interaction at a time.

• Early warning signs appear in customer feedback and operational data. Metrics such as NPS scores, close rates, and sales cycle times can reveal breakdowns in process before problems become visible to customers. • Compliance systems reinforce brand standards. Regular checklists, audits, and mystery shops create accountability. They help franchisors monitor whether locations are delivering the intended experience. • Coaching works better than enforcement. Franchisors often rely on training, communication, and peer recognition to reinforce expectations rather than punishing operators when issues arise. • Technology is expanding how brands monitor and support CX. AI tools can analyze sales conversations, manage customer interactions, and deliver training content to frontline teams. • Working with the right people protects the brand experience. From screening store-level employees to selecting franchise partners, strong customer experiences depend on people who understand and embrace the system’s values.

“If someone is buying a franchise, they’re buying the system,” Ward says. “They have to want to follow that system.”

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Issue 2, 2026 | Franchise Update | 29

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Winning

at the “Can” Level Decades of restaurant experience shape CMO’s approach at Smalls Sliders Written By KERRY PIPES

arlier this year, Smalls Sliders elevated Michael Alberici to chief marketing officer, tapping a seasoned brand leader. Alberici had been senior vice president of marketing for the Atlanta-based burger franchise. His promotion has expanded his influence as the concept continues its national expansion. He leads with a simple but rigorous mandate. “My role is to turn clear positioning into disciplined execution that drives unit-level economics and long-term brand equity,” he says. Every strategy begins with the economics of the “Can” (restaurant location) and then reverse engineers the demand needed to fuel profitable growth across the franchise system. He says success isn’t measured by impressions alone, but by what matters most to operators: traffic, frequency, mix, and profitability. “Consistency across every Can is nonnegotiable,” he says. Alberici has held marketing leadership roles with brands like Cinnabon and Olive Garden, building a résumé that spans franchised restaurants and global consumer brands. That experience informs his disciplined but distinctive approach to brand building. “We don’t try to be everything to everyone,” Alberici says of Smalls Sliders. “We keep the focus tight: craveable sliders, a great guest-first experience, and a brand personality with some swagger.” Alberici believes in keeping marketing grounded in what really matters, which is getting results for franchisees. He’s big on tying brand strategy directly to unit performance, like traffic and profitability, instead of chasing trends. He uses data to guide decisions and focuses on building real demand, not just buzz. At the same time, he understands that brands need personality and energy to connect with guests. Marketing doesn’t take place in a vacuum at Smalls Sliders, he says. Instead, his department stays closely aligned with operations, finance, and tech to ensure campaigns actually work inside each location. That kind of discipline builds trust across the system. Factor in Alberici’s clear communication style and willingness to empower his team, and you get a leader who knows how to grow a brand without losing focus on the fundamentals. Issue 2, 2026 | Franchise Update | 31

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CMO Q&A—Michael Alberici Describe your role as CMO: As CMO, I lead a team focused on brand strategy, culinary innovation, integrated and digital marketing, guest data and insights, and field marketing with a franchise-first mindset. What’s the most challenging part of being a CMO today? The hardest part is separating signal from noise in an environment obsessed with trends. Feelings aren’t facts, and it’s easy to chase momentum instead of building durable demand. The discipline to stay focused while still innovating is what defines great marketing leadership. How has Covid impacted the way you have led your brand’s marketing efforts? Covid accelerated digital adoption and forced brands to earn loyalty differently. It reinforced the importance of owned data, operational flexibility, and local relevance. We now build campaigns assuming agility is not optional. What are the three most important keys to being an effective CMO leader today? First, lead with data but communicate with humanity. Second, protect the brand promise through operational discipline. Third, build teams that reflect the diverse guests you serve and empower them to execute with clarity. How do you prepare a marketing plan and execute the strategies? We start with the economics of the Can and reverse engineer the demand required to hit our goals. Then we align brand storytelling, menu innovation, digital, and local marketing around a single focused plan. Execution is phased, measurable, and built to scale across franchise markets. How do you measure marketing results and effectiveness? We measure what matters to franchisees: traffic, frequency, mix, and profitability. Beyond awareness, we track digital acquisition, retention, incremental lift, and return on spend. Data informs decisions, but disciplined testing drives progress. Discuss your core consumer marketing strategies and objectives: We build demand through cultural energy, the kind of “if you know, you know” momentum that creates anticipation and drives trial. But hype only works if the experience delivers, so we back it with disciplined operations, high-energy hospitality, and craveable food that exceeds expectations. When guests feel that the brand promise matches the moment, perceived value rises, turning first visits into loyalty. How do you go about creating a customercentric marketing and brand philosophy? We listen obsessively to guest data, not just social commentary. We test, measure, and refine based on behavior, not assumptions. Customer-centric marketing means aligning what we promise with what we can consistently deliver inside every Can. Describe your marketing team and the role each of them plays: I’m incredibly proud of our team. They don’t just execute campaigns; they

deeply understand our guests and lead with a franchise-first mindset in every decision. Each team member owns their lane across brand, digital, technology, marketing, insights, and innovation while working cross-functionally with operations, finance, and supply chain to build both the brand and the business. There are no silos at Smalls, just shared accountability to drive demand, protect the promise, and win at the Can level. Why is it so important for the marketing department to have a personal touch when it comes to helping the brand connect with franchise prospects? Franchise prospects aren’t just buying a concept; they’re buying a system and a partnership. Marketing must articulate both the brand story and the economic engine behind it. Authenticity and clarity build trust before a deal is ever signed. How does this help your franchise sales and development effort? Strong marketing de-risks the decision for prospects. When they see disciplined growth, data-driven campaigns, and brand consistency, confidence increases. It accelerates development by proving the model works. What ways/tools do you rely on to do this? We rely on performance dashboards, market-level case studies, digital analytics, and consumer research. We also use immersive brand storytelling across social, PR, and field activations. Transparency backed by data is our most powerful tool. Do today’s prospects expect more from the franchise marketing department? What, and how do you provide it? Absolutely. Prospects expect proof of scalability, digital sophistication, and disciplined spend. We provide clear metrics, defined playbooks, and transparent performance reporting. Monthly system-wide brand meetings, FAC marketing subcommittees, and direct access to any marketing squad member ensure we are not just supporting our franchisees, but building a long-term partnership of support. How is today’s consumer and marketing data helping you fine-tune your marketing initiatives? Consumer data allows us to personalize offers, optimize media, and test value perceptions. It informs menu innovation and helps us understand daypart behavior and attachment rates. Data keeps us grounded in reality, not opinion. Describe the evolving role of social media in your brand’s marketing efforts: Social is both a storytelling channel and a real-time focus group. It drives awareness, builds cultural relevance, and fuels digital ordering. But it only works if the in-Can experience matches the energy online. How do you work with other internal departments, and does technology help? Marketing, technology, and operations are inseparable at Smalls. Every campaign is vetted through operational readiness and financial impact. Technology enables real-time collaboration and shared visibility across teams.

Which technology tools are most valuable to you and why? Our POS and digital ordering platforms are critical because they generate the data that guides our decisions. CRM and loyalty tools help us build long-term relationships. Analytics platforms ensure accountability and smarter media investment. How do you stay on top of changing technology? I stay close to partners, emerging brands, and cross-industry leaders. I also prioritize curiosity within my team and encourage experimentation. Staying informed is important, but staying disciplined is essential. How do you manage costs and budgets for the marketing department? We budget with unitlevel profitability in mind. Every dollar must have a purpose, whether it’s building brand equity or driving traffic. Discipline in spend is how you earn franchise trust. Do you see vendors as business partners? Why/ why not? We don’t use the word “vendor” at Smalls. They are absolutely our partners. The right vendors are strategic partners, not transactional suppliers. We expect transparency, accountability, and shared ownership of results. When aligned properly, they extend our team’s capability. How have marketing strategies/tools changed over the past decade? How have you adapted? Marketing has always been responsible for driving demand, but over the past decade, the role has become far more integrated with financial analytics and capital discipline. Real-time performance data, digital ordering, and attribution tools now allow marketing and finance to operate as partners by aligning spend to unit economics, cash flow, and long-term valuation. I’ve adapted by leading marketing as both a brand builder and a steward of capital, ensuring our investments are measurable, repeatable, and scalable across the franchise system. How is your marketing/branding strategy developed, and how does it flow through the system? It begins with a clear brand promise and disciplined operational model. From there, strategy translates into national campaigns, local activation, digital engagement, and field support. What advice would you offer to aspiring CMO executives? Lead with humility and clarity. Trust your instincts, but always back them up with facts. Know your numbers, from PMIX and sales trends to industry benchmarks, because vision without financial fluency is just noise. Be bold enough to paint the future but disciplined enough to execute it. Build a trusted peer network. Empower your team to take risks. Marketing sits at the intersection of performance and perception, so it carries high visibility in both up cycles and down cycles. Embrace that responsibility, stay anchored in the data, and make sure your team feels the credit when results follow. No one builds a brand alone.

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Issue 2, 2026 | Franchise Update | 33

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CMO Roundtable

How do you ensure the brand promise communicated in marketing matches the in-store experience across all locations?

t Kilwins, ensuring our brand promise aligns with the in-store experience starts with a clear sense of purpose. Our mission is to “make more happy” in the communities we serve, and that mission is woven into how we operate, communicate, and show up every day. The good news is that we start from a place of happiness: Most guests walk through our doors excited to get a treat, and that happiness grows once they see, smell, and taste our products! Because happiness is both emotional and experiential, what we promote in marketing reflects what guests experience in our stores. Two of our foundational brand pillars are premium-quality products and in-store “theater.” We don’t just sell ice cream, fudge, chocolates, and other confections; we create memorable moments that naturally deliver on our mission to make people happy. The sight of caramel being poured, the aroma of waffle cones baking, and the experience of watching Mackinac Island fudge being hand-paddled on our marble tables are central

to the Kilwins experience. Because many of our products, like these, are made in-store, this is all a part of our daily operations. The craftsmanship and quality we showcase in marketing through behind-the-scenes and “how it’s made” content naturally come to life when a guest walks through the door; this content serves as proof points for our premium positioning. The in-store theater combined with the taste and quality of our products and delightful service leaves our guests with smiles (happiness!), and they often return with friends and family to share the experience. We have received numerous letters and comments from guests who have told us how Kilwins is a part of their traditions, special moments, and celebrations. Our marketing and operations are built from the same foundation: quality, craftsmanship, and delightful service. Our brand promise and the in-store experience reinforce one another, allowing us to consistently “make more happy” wherever Kilwins operates.

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ANGIE ECKELKAMP

Chief Marketing Officer Kilwins

Issue 2, 2026 | Franchise Update | 35

CMO Roundtable

Clear expectations and standardized tools reduce variability across markets. That consistency safeguards the brand far more effectively than additional oversight.

n a global franchise system, complexity is the enemy of consistency. At BNI, our brand promise is rooted in one philosophy: givers gain. When members help others grow, they grow in return. That idea isn’t just a marketing message; it’s the operating principle behind almost 12,000 chapters worldwide. Simplicity is what makes alignment possible at scale. Every BNI chapter follows a structured, one-page meeting agenda. It’s disciplined and repeatable. Whether you visit a chapter in Texas, Austria, or the U.K., the core experience is recognizable. Members introduce themselves in a consistent format. Referrals are tracked the same way. Accountability is built into the meeting structure. The system protects the promise. As CMO, my role is not to create a promise that operations must chase. It is to amplify what the system already delivers. Marketing works closely with training, technology, and field leadership to ensure our external messaging mirrors the lived member experience. If we promote measurable growth, our reporting tools must demonstrate it.

HEATHER MCLEOD

Chief Marketing Officer BNI

36 | Franchise Update | Issue 2, 2026

If we highlight community, the meeting format must foster it. Simplicity also creates clarity for franchise owners. They are not asked to reinterpret the brand; they execute a proven framework. Clear expectations and standardized tools reduce variability across markets. That consistency safeguards the brand far more effectively than additional oversight. Finally, we measure rigorously. Member satisfaction, referral revenue, and retention metrics give us real-time feedback. When we see drift between promise and delivery, we adjust the system, not just the story. As franchise brands expand globally, the temptation is to add layers. Our experience has been the opposite. The clearer the philosophy and the simpler the structure, the more scalable and consistent the brand becomes. When the promise is simple and the system reinforces it, marketing doesn’t manufacture alignment. It reflects reality.

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CMO Roundtable

As we’ve grown from our roots in Belmar, New Jersey, into a national franchise, one of my biggest priorities has been making sure the feeling people get in our marketing is the same feeling they experience in the store.

hen you build a brand from the ground up, the promise you make to guests has to be something you can deliver every single day. At Playa Bowls, our marketing isn’t about creating an image that only exists online. It’s about reflecting what people will actually experience when they walk into one of our shops. From the beginning, Playa Bowls has been about more than just the product. It’s about energy, community, creativity, and making healthier choices feel fun and accessible. We often talk about our brand as “Pineappleland,” which represents the positive, welcoming lifestyle people associate with Playa Bowls. As we’ve grown from our roots in Belmar, New Jersey, into a national franchise, one of my biggest priorities has been making sure the feeling people get in our marketing is the same feeling they experience in the store.

ABBY TAYLOR

For me, that starts with brand clarity. If you don’t have a clearly defined identity, values, and standards, it becomes difficult to maintain consistency as you scale. Our marketing reflects who we are, but it also sets expectations. That means every shop needs to deliver on the quality, atmosphere, and hospitality guests associate with the brand from fresh ingredients and vibrant bowls to the

welcoming environment people expect when they walk through our doors. A big part of that comes down to alignment across the system. We invest heavily in clear brand standards, thoughtful shop design, product quality, and strong communication with our franchise owners. Our marketing team works closely with operations to ensure that what we promote nationally can be executed consistently at the shop level. If a guest sees something in our marketing, they should be able to walk into a Playa Bowls and have that experience meet or exceed what they expected. Our franchise owners and their teams play a huge role in bringing that promise to life. Playa Bowls has always been community driven, and our shop owners help create the energy and hospitality that define the brand in their local markets. While our corporate team helps shape the brand vision and marketing strategy, our owners and their teams deliver the experience guests remember. At the end of the day, brand trust is built through consistency. Marketing may introduce someone to Playa Bowls, but the in-shop experience is what turns a first visit into a loyal guest.

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Co-Founder and Chief Marketing Officer Playa Bowls

Issue 2, 2026 | Franchise Update | 37

CMO Roundtable

The experience a customer receives should always match the story our marketing tells. When those two are aligned, the brand grows stronger with every job completed.

t Handyman Connection, we focus on aligning three key areas: brand standards, franchisee training, and customer feedback loops through Net Promoter Score (NPS) measurement.

project follow-through. When owners understand that brand consistency drives long-term customer loyalty, they become strong stewards of the brand. This is done through a working document we have called “Operationalizing Our Brand Experience.”

First, we have established clear brand standards that define what the customer experience should look like at every touchpoint. The list is known as “The Six Critical Connections” connections at Handyman Connection. Our marketing communicates core brand promises such as trusted craftsmen, background-checked professionals, warranty-backed work, and locally owned service. These promises are not just messaging; they are operational requirements built into how franchise owners run their businesses. Proper execution and implementation are key to our success at the brand and local levels.

Third, we rely on customer feedback and performance data to close the loop. Tools such as NPS, customer reviews, and operational metrics allow us to monitor whether the experience being delivered matches what customers expect. If gaps arise, we work directly with the franchisee to address them through coaching, operational adjustments, or marketing alignment.

Second, we invest heavily in onboarding and ongoing coaching for franchise owners and their office teams. Marketing success is not just about generating leads; it’s about ensuring the team knows how to deliver the experience customers were promised. That includes best practices for communication, estimating, scheduling, and

ANGELIQUE MCMILLAN

Vice President, Marketing Handyman Connection

38 | Franchise Update | Issue 2, 2026

Finally, we emphasize that while Handyman Connection locations are locally owned and operated, they operate under one unified brand promise. That balance of local ownership with strong brand accountability is what allows us to scale while maintaining trust with customers. At the end of the day, the goal is simple: The experience a customer receives should always match the story our marketing tells. When those two are aligned, the brand grows stronger with every job completed.

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Social Media

Unit-Level Signals Local reviews, validation, and AI are reshaping franchise development

• “Is brand Z a good franchise investment?”

Written by JACK MONSON

our franchise development might be underperforming, and it might not have anything to do with weak lead flow or insufficient ad spend. The real problem could be customer experience at the unit level. In 2026, the fastest way to improve your closing rate may not be increasing your marketing budget. It may be improving what your franchisees are delivering locally. More than ever, franchise deals are being derailed during validation. And now, with AI embedded into the franchise buying journey, those local issues are amplified at scale. What used to be a handful of isolated customer complaints can now ripple through your brand reputation in ways that directly affect franchise sales. There’s significant untapped ROI in improving customer experience not just for same-store sales, but for franchise development.

This is where a real partnership between franchise development and operations becomes critical. When development and operations teams work closely together—and when they are supported by real-time performance data, review monitoring tools, and customer experience platforms—they can dramatically change outcomes. Improving performance for even a small number of struggling franchisees can strengthen validation and improve closing rates across dozens of future deals.

A NEW WAY TO SEARCH

But the bigger shift happening right now is technological. The way candidates research franchise brands has changed dramatically in the past few years. Not long ago, when we talked about candidates researching franchise brands, we meant spending hours on Google searches, reading articles, watching interviews, comparing websites, and talking to brokers. Candidates pieced together information from dozens of sources and slowly formed their impressions of a brand. Today, research often looks very different. It might mean spending a few minutes with ChatGPT or another large language model (LLM). In the time it takes a candidate to finish a cup of coffee, AI can gather and synthesize information from across the internet. That includes: • Online reviews • News coverage

UNIT EFFECT

Trying to grow a franchise system that validates poorly is like bailing water out of a sinking rowboat without fixing the hole in the bottom. You can fill the pipeline with qualified candidates. You can nurture them through discovery days and broker introductions. But once those candidates start talking to franchisees who are frustrated, underperforming, or struggling with local execution, the entire process slows down. Many franchise sales professionals know this frustration all too well. They work hard to generate interest and move candidates through the process only to lose momentum because they have limited influence over what’s happening inside the units.

Consider a very realistic sequence of events: A customer visits one of your franchise locations and has a poor experience. They leave a negative review on Google or another review platform. That review becomes part of the public data environment. LLMs ingest that information as they are trained and updated. Later, a franchise candidate asks some questions:

• Social media commentary • Franchisee feedback • Reddit discussions • Brand reputation signals All of that information can be summarized instantly into a few paragraphs that shape a candidate’s perception of your brand. That changes everything. One of the strongest signals influencing how brands appear in AI-generated responses is aggregated customer sentiment across locations. Every review, every complaint, and every positive experience contributes to the digital picture of your brand.

• “What are the best franchise brands in this category?” The AI response incorporates the sentiment signals it has gathered from across the web, including those customer reviews. The answer might determine whether the candidate schedules a call or moves on to another brand entirely.

ONGOING PROBLEMS

This isn’t a one-time occurrence. This process happens every day at scale across thousands of AI prompts in every franchise category. What once looked like isolated feedback from a single location is now part of your brand’s system-wide reputation. Reddit plays an especially interesting role in this new ecosystem. Most major LLMs rely heavily on Reddit as a data source because it is perceived as authentic, user generated, and relatively free from brand marketing influence. Discussions there often carry a lot of weight: • A handful of unhappy customers • A few frustrated franchisees posting publicly • A cluster of unresolved service complaints In the AI era, those signals don’t stay buried in a comment thread. They become part of your brand’s digital fingerprint, which directly influences franchise development outcomes. You can’t outspend a weak customer experience. If local issues persist, they will eventually surface in validation calls, online reviews, Reddit discussions, lender research, and AI-generated brand summaries. Customer experience is no longer just an operations issue. It’s a franchise development strategy. In the years ahead, the brands that close the most deals won’t be the ones generating the most leads. They will be the ones shaping the data that AI sees by improving the real-world experiences happening inside their locations every day. When candidates start asking machines about your brand, the machines will be listening to your customers.

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Jack Monson is the chief growth officer of franchise marketing agency Thunderly and has been working with franchise brands in marketing for more than 15 years. He is also the chair of the IFA’s Marketing & Innovation Committee and the host of Social Geek, the most popular franchise podcast. Issue 2, 2026 | Franchise Update | 39

Customers Count

Make Price Irrelevant Customer journey mapping creates brand-defining experiences Written by JOHN DIJULIUS

hy are there a few brands with a high percentage of customers who cannot live without them while the competition struggles? Customer-centric brands have made price irrelevant. The key to building long-term customer loyalty is building a positive experience so engaging and memorable that your existing clients can’t stop talking about it, resulting in repeat business and customer referrals. It is about creating your brand’s signature experience. Companies spend millions creating and advertising their brands, yet the customer’s experience drives customer perception, retention, and referrals. If you take care of your existing clients, they will generate more new customers than any advertising campaign ever could. Think about what

might happen if you reversed your advertising and customer service budget. Are your customers’ experiences dependent on which employee they encounter? Are there employees on your team you hope your best clients don’t interact with? If so, you have what is known as “employee roulette,” a problem most organizations have. The customer shouldn’t suffer just because you have a new employee in a customer-facing role in their first 90 days. Remember: The enemy of a great customer experience is inconsistency.

VARIETIES OF ROULETTE

In addition to employee roulette, there can be department roulette, location roulette, or franchisee roulette. You need to remove employee roulette.

There is good news: You can significantly improve your customer experience with your existing group of employees.

PERSONAL INTERPRETATION

What do the following phrases have in common? • “We are a customer-first organization.” • “Treat customers the way you want to be treated.” • “Exceed customer’s expectations.” • “Going above and beyond is our standard.” • “We deliver genuine hospitality.” These are great mantras, but they don’t provide concrete direction for their team members. You will get 100 personal interpretations if you tell 100 employees to exceed customer expectations or go above and beyond for your client. Truly world-class customer experience organizations remove personal interpretations when training team members to deliver exceptional service at each customer journey touchpoint. How do you reduce employee roulette and eliminate employees’ personal interpretations? You create your brand’s signature experience.

VISUALIZE THE PATH

Your business must have a unique signature experience to stand out from your competition. A signature experience is your organization’s distinct experience that your customers can only get consistently from you. Creating a signature experience has nothing to do with the type of industry you are in, B2B or B2C. World-class brands build signature experiences through customer journey mapping. Businesses visualize the path their customers take from initial contact to the final sale and beyond. This process helps organizations understand customer experiences at touchpoints across channels, allowing them to identify areas to improve and enhance overall customer experience. Customer journey mapping is an ongoing process that can significantly impact your strategic decisions and help deliver a better customer experience. Your customer journey mapping will result in a training tool that The DiJulius Group calls a 40 | Franchise Update | Issue 2, 2026

LT.agency

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Customers Count

Customer Experience Cycle (CEC). Replace the word “Customer” with whatever you call the person buying from you, i.e., client, patient, or guest. The CEC dramatically increases the likelihood that your customers receive a consistent, high-level customer experience, regardless of whom they encounter.

BREAK IT DOWN

Every stage of the CEC needs to be looked at from the customer’s perspective. For a restaurant, the stages might be reservations, initial greeting, table

seating, server greeting, meal presentation, table visit, and check delivery. Once you know your stages, break down each into four components: • Service defects. What can go wrong at this touchpoint that can negatively impact experience? • Operational standards. What must employees do to get the job done quickly and efficiently and reduce service defects from happening?

• Experiential standards. What can your employees consistently do to build rapport, make emotional connections, and develop relationships? • Above and beyond opportunities. How can you train and empower your employees to seize opportunities to surprise and delight a customer? The CEC is all about giving your teams—across shifts, departments, and locations—a tool so that they can deliver a consistently great experience. When done right, the CEC exercise: • Maps out each of your organization’s touchpoints where a customer typically interacts with you • Examines how similar or different your organization’s customer experience is from that of most of your competitors • Examines the most common service defects that can negatively impact the experience at each touchpoint • Creates processes to reduce or eliminate those service defects • Standardizes and documents your brand’s signature experience processes at each touchpoint, which need to be delivered consistently to separate from your competition. The end result is training materials (manuals, videos, etc.) that every existing and new employee is trained on, tested, certified, and held accountable for executing. In today’s world, to stand out and make your customer experience your single biggest competitive advantage, you must create your signature experience. A signature experience is your organization’s distinct customer experience that your customers can only get consistently from you. Once you do, you are making price irrelevant and becoming the brand your customers cannot live without.

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John DiJulius III, author of The Customer Service Revolution, is president of The DiJulius Group, a customer service consulting firm that works with companies such as Starbucks, Chick-fil-A, RitzCarlton, Nestle, PwC, Lexus, and many more. Contact him at info@thedijuliusgroup.com or 216-839-1430. 42 | Franchise Update | Issue 2, 2026

FIND TRUTH. BUILD TRUST. POWER GROWTH. In our fragmented digital world, it’s difficult to build brand loyalty. To grow, brands need to follow data-driven insights and build trust. That’s what we do at REGROUP. We use data to build trust through storytelling and drive growth with strategic, diversified media campaigns. REGROUP is a full-service marketing agency. We have been helping franchise brands drive growth through brand + performance solutions for over 40 years. ARE YOU READY TO REGROUP?

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CLIENTS PAST & PRESENT: Detroit Wing Company, Beyond Juice, Molly Maid, FCI, A&W, Right at Home, Ziebart, Children’s Orchard

From Metrics to Meaning Franchisors help franchisees turn data into better decisions

Written by HELEN BOND

44 | Franchise Update | Issue 2, 2026

Unit Level

ranchise veteran Sam Ballas is obsessed with franchisee profitability. The founder and CEO of East Coast Wings + Grill even has “EBITDA” stamped on his license plate. It might earn a laugh at a stoplight, but for Ballas, it’s not a punchline. It’s a reminder of what he sees as the franchisor’s core responsibility. In an industry increasingly driven by data, Ballas believes the numbers should always point to the same outcome. “The two most important things in franchising are your franchise owners and franchise owner profitability,” Ballas says. Operators today are surrounded by information. POS systems capture every transaction, loyalty platforms track customer behavior, digital dashboards measure marketing engagement, and labor systems forecast staffing needs down to the hour.

“If I’ve got a store doing $120,000 in revenue and another doing $121,000 but one shows a $6,000 profit and the other $17,000, we’ve got a problem in Denmark.”

The problem is no longer a lack of data; it’s turning it into something franchisees can actually use. “I think franchisors own the responsibility of being obsessed with unit-level economics and what the stores do,” Ballas says. Across the industry, successful brands are learning that analytics deliver the most value when raw numbers are translated into clear operational guidance. The bigger question many franchisors now face is whether they are giving franchisees the clarity and tools they need to compete in their local markets.

Sam Ballas Founder and CEO East Coast Wings + Grill

INFRASTRUCTURE

Long before data analytics became a boardroom buzzword, Ballas was building internal infrastructure around it. Drawing on his finance background, Ballas established a dedicated unit-level economics department at East Coast Wings + Grill focused entirely on individual-store performance. The department monitors the financial and operational health of every restaurant in the full-service, fast casual franchise, tracking key performance indicators (KPIs), comparing locations against internal benchmarks, and flagging potential issues early. Step inside the office of Tori Hoots, the brand’s senior data analyst, and the scene looks less like restaurant operations and more like a trading floor. Dual monitors display metrics across the chain’s 50-plus locations. “You’d think she was trading bonds on Wall Street,” Ballas says. Instead, Hoots spends her days digging through restaurant data, reviewing KPIs across different locations and time periods, and continuously updating the data. “You can ask her anything,” Ballas says, “and in about 20 minutes, she’ll punch it back out to you.”

Each restaurant gets a color: green, yellow, or red. But those signals are only the starting point. The analytics team watches for trends. If a store remains yellow or slips into red, the numbers are compared against similar units elsewhere in the system. That’s when discrepancies emerge.

“This has to be a consistent policy for trust to develop,” Ballas says.

“If I’ve got a store doing $120,000 in revenue and another doing $121,000 but one shows a $6,000 profit and the other $17,000, we’ve got a problem in Denmark,” Ballas says.

“There’s a lot of data out there,” says Bobby Banzhof, director of franchise operations at Chicken Salad Chick. “How do you use it to make smart decisions for your business?”

When something’s off, whether labor, purchasing, waste, or execution, the data helps pinpoint where to look first. From there, field leaders decide whether the issue warrants a call, a supply chain check, or a visit to work alongside the franchise owner. “They are on the front line, shooting all the time,” Ballas says. “Sometimes, they need a lens on something they may not be thinking about.” The key to getting franchisees on board, Ballas adds, is presenting compelling data in a way that feels reliable and actionable so “franchise owners and their management team will trust; thus embrace.”

As labor pressures, rising costs, and shifting consumer habits continue to challenge operators, the ability to interpret store-level performance data is becoming increasingly important.

That tension between the growing volume of data and the ability to transform it into clear decisions is shaping how franchise systems approach unit analytics.

BEYOND THE P&L

As franchise networks grow, the challenge evolves. It’s no longer simply about how a single location performs; it’s about understanding how each store compares across the network. With more than 330 locations across 30 states, Christian Brothers Automotive evaluates unit-level economics through a combination of system-wide benchmarks and store-level diagnostics. Issue 2, 2026 | Franchise Update | 45

Unit Level information from multiple systems and generate more detailed reports. The system tracks a wide range of operational indicators, including third-party delivery activity, catering traffic, guest counts, and average check, to help make educated decisions.

“We saw the speed of getting those first 100 guests through the line increase.”

A recent example involved the guest ordering experience. Leadership discovered that the existing menu layout was creating friction at the counter. “We realized that the old menu was not performing at the level we wanted when it came to the guest ordering experience and the complexity of ordering,” explains Banzhof. Backed by guest focus groups and multiple design iterations, Chicken Salad Chick rebuilt its menu to clarify ordering and speed up service. Franchisees also played an active role in testing the new layouts, wording, and ease of ordering before a system-wide rollout. In one test, the company tracked how quickly the first 100 guests moved through the line during its signature “Free Chicken Salad for a Year” grand opening promotion. In a new market location, where long waits can shape early impressions, speed matters.

Bobby Banzhof Director of Franchise Operations Chicken Salad Chick

“We look at system-wide averages to understand overall brand health, and we look at performance to identify specific strengths and opportunities,” says Michael Allnutt, chief operating officer of the auto services and repair brand. The company tracks core metrics, including revenue, expenses, gross profit, net operating income (NOI), car count, average repair order, labor rate, and technician hours sold. “These metrics are all interconnected and ultimately drive NOI,” Allnutt says. “While they are high-level indicators, they also allow us to drill down into more detailed data to uncover root causes and areas for refinement.” Some of the most valuable takeaways come from areas that traditional financial snapshots rarely capture. “One of the most common data gaps we see relates to customer relationships,” Allnutt says. “Guest interactions are complex, and key drivers like retention, days until serviced, and communication transparency are not always visible in standard reporting.” To address that blind spot, CBA has strengthened reporting around its digital vehicle inspection (DVI) process, which allows technicians to document vehicle conditions and communicate repair recommendations directly to customers. 46 | Franchise Update | Issue 2, 2026

“We saw the speed of getting those first 100 guests through the line increase,” Banzhof says.

That same commitment to transparency extends to franchisees. The company has invested heavily in making financial information visible across the network, sharing metrics like revenue, cost of goods sold, labor efficiency, marketing spend, and operating expenses. “As we made labor rate management and parts margin performance more transparent, we saw measurable improvements in both top-line revenue and bottom-line profitability,” Allnut explains. Internal reports shared on a consistent cadence give operators a clear view of where their stores rank within the system. Peer groups, internal scoreboards, and system-wide benchmarks provide context not as “shame and blame,” but as a framework for improvement and opportunity. “The focus is not just collecting data, but making it actionable,” Allnut says. Transparency drives accountability, accountability drives improvement, and consistent improvement at the unit level strengthens the entire brand.

The data also revealed a shift in purchasing behavior. The share of guests adding a second side or upgrading meals increased from roughly 20% of orders to about 33%, a more than 50% lift that boosted check averages while making ordering easier for guests and team members.

REAL-TIME VISIBILITY

While restaurant brands often use analytics to refine menu strategy and guest flow, service franchises are applying the same discipline to manage capacity, staffing, and demand. At Hand & Stone Massage and Facial Spa, a centralized data warehouse and real-time reporting platform have evolved into a powerful growth engine for the network of more than 650 locations. The initiative originally began as an effort to solve common challenges in franchising. Franchisees had limited visibility into KPIs, making it difficult to benchmark, manage staffing efficiently, or understand how marketing and service demand were translating into booked appointments.

DATA DRIVING

“Today, spa owners and managers are actively using Power BI dashboards to monitor therapist utilization, appointment-hour pacing, lead conversion, retail attachment rates, and membership trends in near real time,” says Siddharth Desai, Hand & Stone’s chief digital and technology officer.

Chicken Salad Chick has steadily expanded its unit-level monitoring in recent years. The fast casual brand now uses Tableau, a data visualization and business intelligence platform, to consolidate

For service businesses like Hand & Stone, managing capacity is a fine balance between staffing and demand. With visibility into both, franchisees of the wellness chain can now make operational tweaks during the week rather than wait for monthly financial reports.

In practice, the real value of data often appears in day-to-day operations.

Unit Level Since the initial launch, the system has expanded its capabilities to include real-time irregular transaction monitoring to spot potential fraud as well as on-demand liability reporting tied to prepaid services, gift cards, and memberships.

One of the platform’s most distinctive features is the brand’s service provider utilization tool, helping franchisees align staffing decisions with actual demand patterns. “To our knowledge, it’s the only tool of its kind in the industry that allows owners to drill down to a specific service provider and the exact hour he or she worked and understand whether that time was booked, idle, or misaligned to guest demand,” Desai says.

ANALYSIS TO ACTION

Even with sophisticated dashboards in place, the harder task is making sure franchisees apply information to their businesses. “We’ve learned that simply giving franchisees access to dashboards doesn’t drive adoption,” Desai says. “Embedding data into the day-to-day operating rhythm of the spa does.”

Siddharth Desai Chief Digital and Technology Officer Hand & Stone Massage and Facial Spa

Training now focuses less on pulling reports and more on what the numbers mean for business. Coaching conversations, peer-group discussions, and field visits are now anchored in spa-specific metrics. “The biggest behavioral shift came when franchisees stopped looking at analytics as a reporting exercise and started using it as a decision-making tool to proactively manage staffing, scheduling, and demand generation within their four walls,” Desai says. For Hand & Stone, that shift has also changed the conversations between franchisor and franchisee. “We’re using unit-level performance data to fundamentally shift the franchisor–franchisee relationship from one based on anecdote to one grounded in shared facts,” Desai says. Chicken Salad Chick takes a hands-on approach. Franchise business consultants support approximately 30 restaurants each. “That way they can be with them more frequently,” Banzhof says. “We want to be there to partner with them, to help them make an impact in their restaurants.” Data becomes a coaching strategy rather than a compliance tool. “Having all this data at their hands does help them make great business decisions,” Banzhof says. “And teaching them what the data means and how to use it to impact their business is extremely important. And it’s not a one-size-fitsall. Each restaurant in each group is different, so really, it’s knowing your owners and having that relationship with them to understand what they need and what’s going to make the biggest impact in the restaurant.”

Those findings are also guiding how brands support franchisee expansion. Chicken Salad Chick uses Buxton location intelligence to evaluate trade areas and guide site selection. With more than 327 restaurants generating reliable comparables, the brand can benchmark potential locations against real operating patterns to scale smartly. Hand & Stone applies similar analytics to development, using historical demand patterns and appointment pacing data to help new spas open with optimized staffing models and targeted marketing strategies. For franchisors working with lenders and multiunit investors, strong unit-level economics can be a powerful credibility signal. “Leveraging unit-level economics through tools like ProfitKeeper allows us to tie operational drivers directly to spa-level EBITDA,” Desai says. Chicken Salad Chick similarly leans on unit economics to share its brand story, highlighting average unit volume growth alongside favorable build-out costs and efficient footprints. Christian Brothers Automotive also provides annual performance packets to lending partners, emphasizing long-term stability and consistent unit results.

THE RIGHT METRICS

The number of measurable signals inside a franchise business has expanded dramatically over the past decade. “Back in the day, it used to be you would measure check averages, seat count, and sales per seat count per square footage, basic unit-level type of data that would give you some kind of idea of how the consumer was embracing the brand,” Ballas says. “And that all has gotten a lot more KPI technical.” Today, Ballas’ team goes far beyond basic reporting, applying deeper analysis to better understand how each restaurant is performing. The brand tracks traffic patterns through geofencing, differentiates between new and existing guests, integrates loyalty data with guest surveys, and compares case counts with purchased inventory in specific family groups: burgers, wings, and fries. “Most of the data processing that we have focused on has not just been the traditional capturing of economic movement,” Ballas says, “but capturing data that tells us what the guest feels and thinks about a location.” The goal, he says, isn’t to measure everything. “You want the right 10 or 12, 15 or 16 KPIs that will move the needle,” Ballas says. Issue 2, 2026 | Franchise Update | 47

Unit Level

“We look at system-wide averages to understand overall brand health, and we look at performance to identify specific strengths and opportunities.”

KEY TAKEAWAYS

• Franchisors own unit-level economics. Leaders argue that the franchisor’s primary responsibi l it y is helping fra nchisees improve profitability.

• The challenge today isn’t data collection; it’s

interpretation. Operators are flooded with information from POS systems, loyalty platforms, marketing dashboards, and labor tools.

• Analytics only matter when they lead to

action. The most successful brands translate raw metrics into clear operational guidance franchisees can use.

• Dedicated analytics infrastructure can drive

performance. Some brands now maintain internal teams focused entirely on unit-level economics and system-wide benchmarking.

• Benchmarking across the network reveals Michael Allnutt Chief Operating Officer Christian Brothers Automotive

hidden performance gaps. Comparing similar units can expose issues in labor, purchasing, execution, or operational discipline.

• The most valuable insights often extend

beyond the P&L. Metrics tied to customer relationships, such as retention, communication, and service patterns, can uncover opportunities financial reports miss.

As reporting tools become more sophisticated, franchisors are also recalibrating expectations around technology. Artificial intelligence, automation, and centralized data warehouses are expanding the capabilities of what brands can measure. But franchise leaders caution that technology alone won’t drive growth.

Chicken Salad Chick is currently rolling out ProfitKeeper to provide franchisees with an enhanced window into their financial and operational health.

• Operational data can unlock measurable • Real-time reporting allows franchisees to

AI “will not assist any brand as a magic wand,” Ballas says. Technology has to fit within the brand’s ecosystem, and someone has to own it, he says. “Does this platform make the system better, more efficient, more profitable?” Ballas says.

Ballas acknowledges that even with strong analytics, brands won’t catch everything. But the practice itself is the advantage. “If you navigate it hard, laser-like focus that way, and you miss a couple of things, the ones you do land on and win usually make a difference,” adds Ballas.

At East Coast Wings + Grill, every piece of the technology stack must justify itself. “We are very selfish to use platforms or integrations when we can measure a rate of return on investment,” Ballas says. “If we can’t measure it, we don’t do it.” CBA’s Allnutt says AI can assist with data cleansing, integration, and forecasting, but “complex KPI interpretation still requires significant training and human oversight.” The Houston-based brand’s priority over the next five years is to standardize, automate, and enable real-time reporting, reducing manual spreadsheets and increasing operator access. Hand & Stone plans to leverage additional data sources, including waitlist data and recruiting metrics, and apply AI to deliver real-time spa-level recommendations. 48 | Franchise Update | Issue 2, 2026

COMPETITIVE ADVANTAGE

Franchise leaders say the future of performance analysis is shifting away from chasing new technology and toward delivering clear insights that help operators run stronger businesses while strengthening the entire system. For Ballas, that rigor comes back to that same principle that has guided his approach from the beginning. “It’s all about EBITDA and NOI,” Ballas says. “The franchise model is a financial model designed for delivering services to the public. Yes, there are many nonfinancial elements, but at the end of the day, it’s financials. Without strong data or—better yet—a culture for driving data, you can’t develop a consistent financial model.”

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improvements. Brands have used analytics to refine menu design, improve service speed, and increase average check size. make faster decisions. Platforms that track staffing, utilization, and demand patterns help operators adjust during the week instead of waiting for monthly reports.

• Technology alone isn’t the solution. AI and

advanced analytics can support forecasting and integration, but interpreting KPIs still requires training, leadership, and human judgment.

• A culture of data-driven decision-making creates a competitive advantage. When analytics become part of everyday operations and franchisor-franchisee conversations, they strengthen both individual unit performance and system-wide growth.

Challenge the Pros

How do you ensure continuity of brand standards and unit performance during ownership transitions and/or resales?

nsuring continuity between franchise prospects begins well before the business ownership transition takes place. We conduct comprehensive operational and financial reviews to ensure the business is positioned for a smooth transfer. We then provide the incoming franchise owner with a structured onboarding process that includes extensive training, access to historical performance data, and clear guidance on brand standards and operational expectations. It’s important to support the people and client relationships that sustain the office we’re

DAN BRUNELL

Senior Vice President of Franchise Development Spherion Staffing and Recruiting

50 | Franchise Update | Issue 2, 2026

transitioning. Our team works closely with new franchisees to implement communication plans for existing team members and clients and provide change-management coaching. We pair franchisees with experienced, senior portfolio leaders and peer mentors. This approach preserves the strengths of the existing business while giving the new franchise owner the tools, insights, and support needed to drive the next phase of local growth.

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Challenge the Pros

We don’t treat resales as ‘any buyer will do’ but instead hold prospective buyers to the same qualification standards as new-unit franchisees.

t WellBiz Brands, ensuring continuity of brand standards and unit performance during ownership transitions and resales starts long before a transaction ever takes place. The up-front conversations we have with our franchise partners encourage them to operate with the end in mind and to think about not just running their businesses for today, but what their life would look like if they needed to exit tomorrow. This mindset shift drives our franchisees to be better operators and leaders for their teams. We also take a disciplined approach to buyer qualification. We don’t treat resales as “any buyer will do” but instead hold prospective buyers to the same qualification standards as new-unit franchisees. We evaluate financial capacity, operational experience, leadership capability, and alignment with our brand’s mission and values. By setting these standards, we ensure that incoming owners are positioned to operate at or above current performance levels rather than allowing quality to falter during a transition.

JAMES FRANKS

Every ownership transfer is supported by a transition plan designed to eliminate variance and create consistency across markets. This plan includes a comprehensive location assessment, a brand standards audit, systems and technology

access, required training, a marketing reset where needed, and structured onboarding for both ownership and in-store team members. This ensures that regardless of the unit location or the incoming owner, the transition process reinforces our brand expectations and aligns with our operational standards. The first 90 to 180 days post-transfer are especially critical. During this time, we closely monitor the location’s revenue trends, labor efficiency, guest satisfaction, and brand compliance. These key performance indicators help us identify early warning signs and intervene quickly to ensure performance remains high. We are proactive in our support of our franchise partners, so they understand they aren’t alone in the process. We’re always available to help and implement corrective actions when needed. Ultimately, our goal is to treat resales with the same rigor and discipline as new unit growth. By combining strong up-front qualification, structured transition planning, and proactive performance management, we protect both brand integrity and unit-level economics. This approach ensures ownership transitions become an opportunity to reinforce standards and drive performance without becoming a risk to the system.

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Senior Vice President of Franchise Growth WellBiz Brands

Issue 2, 2026 | Franchise Update | 51

Challenge the Pros

A change in ownership can create uncertainty at the unit level, so the goal is always to bring clarity, consistency, and support early in the process.

aintaining brand standards and unit performance during ownership transitions starts with recognizing that these moments are as much about people and process as they are about the transaction itself. A change in ownership can create uncertainty at the unit level, so the goal is always to bring clarity, consistency, and support early in the process.

teams clearly understand what “good” looks like, where there is flexibility, and where standards are nonnegotiable. Setting those expectations upfront helps avoid confusion and builds trust on both sides. I’ve learned that most problems during transitions don’t come from bad intent; they come from assumptions. Clear communication early prevents a lot of avoidable issues later.

Before a transition is complete, I like to get a clear, honest picture of how the business is actually operating. That means looking beyond headline financials and spending time on unit-level performance, compliance with brand standards, staffing stability, and any operational issues that may have been deferred. Understanding where the real pressure points are allows us to prioritize what needs attention immediately and what can be addressed over time.

For a period after the transition, we tend to stay more closely engaged. That often means more frequent check-ins, additional field support, and closer review of key performance indicators. The intent isn’t to micromanage but to ensure issues are identified quickly and our operators know they are not on their own. Equally important is maintaining stability within the stores.

After the change in ownership occurs, alignment becomes the focus. Even experienced franchisees benefit from reconnecting with the brand’s origins, so onboarding and communication are critical. We make sure incoming owners and their leadership

SEAN RENTCHLER

Vice President of Growth & Development MassageLuXe

52 | Franchise Update | Issue 2, 2026

Ultimately, continuity comes from treating ownership changes as a shared responsibility rather than a handoff. By staying engaged, communicating clearly, and focusing on people as much as performance, transitions can be handled in a way that protects the brand while setting the new owner up for long-term success.

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Challenge the Pros

Whenever possible, we prioritize retaining existing managers and team members to preserve institutional knowledge and maintain operational stability.

nsuring continuity of brand standards and unit performance during ownership transitions requires a disciplined, structured approach that addresses training, people, and marketing in a coordinated manner. The objective is to protect the guest experience, sustain operational consistency, and position the restaurant for continued success from day one. We begin by assessing whether the acquiring owner is an existing franchise partner or new to the brand, tailoring the transition plan accordingly. If an experienced franchise partner is purchasing an additional location, we evaluate their operational track record and overall portfolio depth. A partner who successfully operates multiple restaurants may require less foundational instruction. However, we still provide targeted onboarding to address unit-specific nuances such as historical performance trends, staffing structure, local market dynamics, and any operational opportunities. We also assess whether the restaurant has new equipment, updated technology platforms, or recently implemented processes that require focused training to ensure full alignment with brand standards.

JENNIFER FOLGER

Vice President of Franchise Growth Eggs Up Grill

If the buyer is new to the system, the process is more comprehensive. They must complete the full approval process and participate in our standard training program, identical to what is required for a first-time franchise partner developing their initial location. This ensures alignment with operational

procedures, brand expectations, and cultural standards before assuming control of the business. The people component is equally important. Whenever possible, we prioritize retaining existing managers and team members to preserve institutional knowledge and maintain operational stability. Continuity among staff minimizes disruption, supports morale, and reinforces consistency in service and product quality. Early and transparent communication with the team helps build confidence in the new ownership and reduces uncertainty during the transition. From a marketing perspective, rather than positioning the change as a “Grand Reopening” or “Under New Management” event, we intentionally avoid messaging that could suggest disruption. Instead, we host a celebratory, communityfocused event designed to drive traffic and showcase the strong guest experience the brand consistently delivers. Typically structured as a week-long activation, the event features daily offers, promotions, or contests to create sustained engagement. Many franchise partners incorporate a charitable element by donating a percentage of sales to a local organization, strengthening community ties and generating positive awareness. Supported by local store marketing, social media outreach, and in-store promotion, this approach reinforces continuity while creating renewed energy around the restaurant.

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Issue 2, 2026 | Franchise Update | 53

Sales Smarts

The Flywheel Effect Cross-department collaboration drives franchisee success Written by CHRISTINA CHAMBERS

t the 2025 Franchise Leadership & Development Conference, I had the opportunity to help present a workshop on “Mapping the Franchisee Success Journey.” We covered awarding new franchisees, opening locations, growing the business, and eventually exiting the franchise. One theme rang loud and clear: Collaboration across all departments is essential to franchisee and brand success at every stage. Franchise recruiters are classic generalists. They must understand a little about everything to educate and qualify candidates. Other departments are made up of specialists who bring deep expertise in their specific areas. When franchise recruiting happens in a vacuum, without meaningful collaboration and learning across teams, expectations can be misaligned from the beginning. That misalignment often creates a domino effect and rarely a good one. What does strong cross-department collaboration look like in practice? How does it show up throughout the franchise life cycle? Let’s walk through each stage.

RECRUITING

Before lead generation begins, the strongest franchisors clearly define their ideal franchisee profile. That work should never be done by development alone. Operations teams provide insight into what successful franchisees look like in the real world across revenue, engagement, and growth metrics. For emerging brands, this may start with the founder’s story and an honest assessment of the experience, strengths, and traits required to succeed. When development, operations, and leadership align early, recruiting becomes more intentional and more effective.

AWARDING

A thoughtful discovery process requires input from across the organization. Candidates should hear directly from the teams that will support them long after the agreement is signed. Presentations, videos, or interviews with training, operations, marketing, and other support teams help candidates make fully informed decisions. Development teams often say they date candidates while the operations teams marry them. This is the start of a relationship that may last decades, and alignment matters.

OPENING

In many cases, the development team maintains process oversight during the real estate and construction phases for building brick-and-mortar franchises. For home-based or mobile franchises, there may be a separate team supporting the onboarding and launch phases. If all teams were introduced and involved in the awarding process and franchisees are already familiar with the teams supporting them, onboarding feels seamless. Trust is established early, and the business launches on a strong footing.

GROWING

Once the franchisee is open for business, the coaching and operations teams support and guide franchisee growth. The best franchisors are proactive, offering strategic planning, goal setting, and continuous training to improve results. Key performance metrics are tracked by the operations team, and dedicated franchise coaches provide accountability support so that franchisees have a true partner in their business growth.

An often-overlooked need during this growth phase is the ongoing collaboration with the development team. Maintaining regular communication with operations, coaching, and training teams, along with periodic check-ins with franchisees, creates a valuable feedback loop. Franchisee validation with new candidates remains strong, confirming that expectations set during recruitment match the real ownership experience. Insights help to continuously refine the ideal franchisee profile. When development stays connected beyond the sale, recruiting and award decisions improve over time, creating a stronger and more resilient franchise system.

EXITING

Development teams that start with the end in mind are better positioned to support franchisees from day one. Discussing exit goals during the preaward discovery process creates early clarity and sets a strategic foundation for long-term planning. This focus can help operations teams provide the type of operational support that will be needed over time based on the end goal. A franchisee focused on building and selling their business in five years will follow a very different path than one planning for long-term ownership or succession to the next generation. When development and operations stay aligned around these goals, franchisees benefit from more intentional guidance on items like reinvestment decisions and performance milestones throughout their life cycle. Exit planning becomes an integrated part of growth support. Ensuring successful franchise exits supports the continued growth and stability of the franchise brand as a whole.

SUMMARY

Sustainable franchise growth is powered by intentional collaboration across the entire organization from the first discovery call to long after a franchisee has opened, achieved growth, and exited the system. When teams work in silos, gaps form. Expectations are misaligned, trust can erode, and franchisees feel the friction. Validation drops and brand growth stalls. When teams work together, franchisees feel supported, prepared, and confident at every stage of their journey. Cross collaboration is not about more meetings. It is about the shared ownership of franchisee success. When collaboration becomes part of the culture, franchisees win, teams win, and the flywheel effect of sustainable growth follows.

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Christina Chambers is the chief franchise officer at DOXA Talent where she leads strategy and franchise growth for the purpose-driven brand known for its “conscious outsourcing” model that helps entrepreneurs build recurring revenue businesses with integrity. Learn more at doxafranchising.com. 54 | Franchise Update | Issue 2, 2026

Market Trends

Overcoming Info Overload

In the AI era, the advantage shifts from data to insight Written by PAUL WILBUR

It’s also important to recognize that not all franchise models fit neatly into the same analytical frame. Franchising spans more than 230 industries, each with its own economics, operating structures, and performance metrics. Attempting to force every system into an identical comparison framework often obscures more than it reveals. The hotel industry is a good example. Hotels rarely evaluate performance using AUVs in the way retail or restaurant franchises do. Instead, metrics like RevPAR (revenue per available room), occupancy, and average daily rate are central to understanding performance. Using a standard franchise AUV analysis on a hotel system would miss the factors that actually drive value.

or years, Franchise Disclosure Document (FDD) information has been a strategic differentiator. FDDs are dense, time-consuming to analyze, and difficult to compare across brands. Simply having access to that data and the resources to interpret it has long been an advantage for smart franchisors, lenders, and investors. Every year at FRANdata, industry leaders ask us to benchmark their performance, fees, and development terms against competitors using FDD data. The document has been, and remains, a foundational source of insight into how franchise systems are performing. What has changed is not the importance of the FDD, but the ease of access to the data. AI tools can now ingest FDDs in minutes, extracting fees, litigation histories, unit counts, and financial representations. What once took weeks of diligence can now be done almost instantly. This democratization of information is a meaningful shift for the industry. More data is available to more people faster than ever before. In many ways, that’s a good thing. But it also highlights a reality for the industry: Data alone does not equal understanding. Simply having access to more FDDs is not a silver bullet. For instance, transparency (or lack of it) inside the FDD plays a meaningful role in how franchise systems are evaluated. Prospects, lenders, and sophisticated buyers have long drawn conclusions from a franchisor’s

disclosure choices, particularly around Item 19. Systems that include detailed, representative performance data tend to inspire greater confidence than those that limit disclosure to high-level or partial metrics.

DIFFERENCES STAND OUT

Disclosure decisions carry signals. When performance data is limited, readers are left to fill in the gaps with assumptions. Franchisors need to know that AI makes this comparison more visible. When hundreds of FDDs can be reviewed side by side, differences in disclosure philosophy stand out more clearly. The FDD is a legal and compliance document. Outside of audited financial statements in Item 21, much of the operational and performance data is unaudited and presented within the constraints of regulatory requirements rather than analytical intent. Investment ranges may be technically accurate but still fail to reflect current market conditions. Unit counts may not fully convey ownership churn, transfers, or restructuring activity. Cost assumptions can lag changes in labor markets, insurance, or build-out economics. AI excels at extracting numbers. What it cannot do reliably is determine whether those numbers still reflect how a business actually operates today or how the data should be interpreted in context. Without experience, scale, and industry familiarity, precision can quickly become false confidence.

The same issue arises in territory-based systems, area development models, and concepts built around add-on programs or layered services. A “unit” may represent a location, a territory, or the right to develop future locations. When trying to estimate the size of the industry, those distinctions matter enormously.

NECESSARY BUT INSUFFICIENT

AI can summarize what the FDD says. It cannot reconcile how different business models translate their performance metrics into the standardized disclosure format. FDD data has always been necessary but insufficient. What AI reveals is not a flaw in disclosure, but the importance of expertise in interpretation. As access to data becomes universal, advantage shifts from who has the information to who understands what it means and what it doesn’t. Having access to more data is helpful. Making sense of it across industries, business models, and market conditions is what leads to better decisions. In a world awash in information, experience is still the differentiator.

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As COO, Paul Wilbur is instrumental in building the research and consulting framework at FRANdata. He plays an integral role in the strategic development of FRANdata’s suite of franchise solutions. Nearly a 20-year veteran at the company, he is the franchise business model expert and plays a key role in fostering strategic advisory relationships with some of FRANdata’s biggest clients. Issue 2, 2026 | Franchise Update | 55

International

Cultural

INTELLIGENCE

Respect local norms or pay the price Written by WILLIAM EDWARDS

n global business, culture isn’t a soft skill. It’s a strategy. After more than three decades of helping U.S. franchise brands expand internationally, I can say with certainty that global failures are not all financial failures, legal failures, or supply chain failures. Sometimes, they are cultural failures. Executives entering new markets often focus first on market size, GDP per capita, regulatory frameworks, tax structures, capital availability, and competitive dynamics. Those are all important considerations. But deals can succeed or fail because of how well a franchisor understands how people build trust, negotiate agreements, make decisions, manage hierarchy, and perceive time. Misread culture, and you lose money. Respect it, and you will succeed in expanding your franchise into new countries.

LOST IN TRANSLATION

A U.S. quick-service restaurant brand invested approximately $50 million in entering China. The company imported its American operating model, placing heavy emphasis on delivery and takeout, optimized for speed and efficiency. Six months later, sales were flat. The problem was not the food, the pricing, or the real estate. Dining in China is social. It is family oriented. It is shared. It is community driven. The American model prioritized efficiency; the Chinese consumer prioritized connection and collective experience. The company redesigned its stores to encourage shared dishes and group dining. Seating configurations were changed. Menu presentation changed. The in-store experience changed. Today, that same brand operates more than 1,000 restaurants in mainland China. The lesson was simple: The market wasn’t wrong. The model was culturally misaligned.

A BILLION-DOLLAR REMINDER

Walmart entered Germany in the late 1990s with billions of dollars and enormous confidence. It brought American-style greeters to store entrances, introduced employee cheer routines, and emphasized its “Everyday Low Prices” positioning. German consumers, however, value privacy and reserve. The greeters felt intrusive. The cheer routines felt awkward and even humiliating to staff. Meanwhile, discounters Aldi and Lidl already dominated the low-price segment with deep cultural alignment. After nearly a decade of losses and roughly $1 billion in write-downs, Walmart exited Germany in 2006. The issue was not capital. It was cultural calibration.

NOT ONE-SIZE-FITS-ALL

Culture is a system of socially acquired values, beliefs, and rules of conduct that define accepted behavior in a society. It influences how people communicate, negotiate, prioritize time, and 56 | Franchise Update | Issue 2, 2026

International structure hierarchy. Even within countries, demographic groups and industries differ, but at the national level, patterns matter. Business cultures generally fall into three broad orientations: • Linear cultures, common in North America, Northern Europe, and Australia, tend to be task focused, time sensitive, individualistic, and transactional. • Multi-active cultures, common in Latin America, the Middle East, India, and Mediterranean countries, are relationship first, hierarchical, and often emotionally expressive. • Reactive cultures, prevalent across much of Asia, are listening oriented, consensus driven, relationship centered, and less confrontational.

BRAZIL: RELATIONSHIPS FIRST

Lack of punctuality is a fact of life, so be flexible about your counterpart’s (lack of) punctuality when it comes to meetings. While punctuality may be flexible, relationships are not. Negotiations require patience and often multiple meetings. Direct, aggressive tactics can backfire. Franchisors who arrive with rigid timelines and transactional expectations often interpret Brazilian negotiation style as disorganization. In reality, it is how they do due diligence. Trust precedes contract.

CHINA: EVERYTHING IS NEGOTIABLE

In China, punctuality is respected, but Americans are often viewed as impatient. Negotiations can extend longer than expected, sometimes deliberately, as part of the leverage dynamic. Everything is negotiable even after signing. Franchisors who treat contract signature as the end of negotiation are culturally naive. In many cases, negotiation continues as the relationship evolves. Understanding this does not mean conceding control; it means anticipating process and building flexibility into the partnership. Realize that culturally, once your license agreement is signed, the Chinese side will start wanting to renegotiate the terms.

INDIA: PERSONAL AND HIERARCHICAL

Indians appreciate punctuality but do not always practice it themselves! In India, networking and personal relationships are central to doing business successfully. Decisions often come from the top. Negotiations are less hurried than in the U.S., and bargaining is culturally embedded in the commercial fabric. Reaching decision-makers directly, investing time in relationship building, and avoiding artificial urgency are essential. The fastest way to lose momentum in India is to assume American-style urgency translates. It doesn’t work and can kill a deal.

THE MIDDLE EAST: HOSPITALITY

Relationships must come first. Trust and personal connections matter more than contracts. In

much of the Middle East, business is relationship driven and hierarchical. First meetings may focus largely on getting to know one another. Family background, shared experiences, and mutual connections matter. Hospitality (accepting coffee or tea) is not optional etiquette. It is relationship building. Contracts matter, but personal trust matters more. And there are clear lines that should never be crossed; politics and religion should not enter business discussions. Cultural awareness here is not politeness. It is strategy.

CATERING TO TASTES

Food and beverage franchise brands that scale globally learn quickly that menus are cultural documents. India requires sensitivity to beef consumption. The Philippines often expects pasta offerings in quick-service formats. The Caribbean favors chicken. Japan trends lower in dairy and salt. Middle Eastern markets require halal compliance. Europe frequently has deeply rooted food traditions that resist overt standardization. Exporting an American menu without thoughtful adaptation is rarely sustainable. Global leaders do not simply export. They adapt while protecting their core brand identity.

NO-NO’S MATTER

Small gestures can signal respect or ignorance. Arriving late for meetings in Germany communicates disrespect. Giving a clock in China evokes funerals. Using the left hand improperly in parts of India and Indonesia can be offensive. Showing the soles of your shoes in the Middle East is deeply disrespectful. Refusing Turkish coffee in Istanbul signals relational indifference. Bringing white flowers to dinner in Japan is a no-no as they are a sign of death. These details may appear minor. They are not. They are cultural signals, and signals build, or erode, trust, which can make all the difference when you are trying to get a country license agreement signed.

WHAT IS NOT SAID

Culture influences not only what is said but what is left unsaid. In some cultures, direct disagreement is normal. Nodding yes often just means they understand what you are saying, not that they agree with you. In others, silence signals resistance. In high-context cultures, body language and tone may carry more meaning than words. Franchisors must continuously ask clarifying questions, confirm agreements in writing, read nonverbal signals carefully, and understand hierarchy before assuming consensus. Often, what is not said in a meeting is more important than what is.

BOTTOM LINE

Franchising, perhaps more than any other growth model, depends on local partnership and understanding. And partnership depends on cultural fluency. You can have the best brand, the strongest financial model, and the most compelling growth strategy. But if you ignore how people in a country build trust, make decisions, and define respect, you will eventually pay for that oversight. Culture is not a courtesy variable; it is a performance variable. If you ignore it, you will pay for it. If you respect it, you will succeed in expanding your franchise into new countries and cultures.

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William (Bill) Edwards, CFE AFS, is the CEO of Edwards Global Services (EGS) and a global advisor to international businesses on new country expansion and trade issues. He has helped more than 40 companies expand into new countries. Subscribe to Bill’s biweekly global business update newsletter at insider.edwardsglobal.com. Download Bill’s latest 40 country GlobalVue country ranking chart at edwardsglobal.com/ globalvue/. Contact Bill at +1 949 375 1896 or bedwards@edwardsglobal.com. Issue 2, 2026 | Franchise Update | 57

Tech Beat

DECISIONS, NOT DASHBOARDS Data is only powerful if it changes behavior Written by DENNIS LESKOWSKI

• Whom to call • Which lead is hottest • Where execution slipped • What action restores compliance

This is the quiet problem in franchising today: We are data rich and decision poor. Franchise systems have never had more access to analytics: CRM data, marketing attribution, review scores, response times, pipeline velocity, and call tracking. The dashboards are full. But franchisees aren’t lacking information. They’re lacking clarity on what to do next.

Instead of hoping operators read the franchise manual, the system reinforces it in real time. Tight margins demand consistency. Consistency demands intervention before drift becomes decline.

EXCEPTION REPORTING

Data is only powerful if it changes behavior. If your analytics don’t alter what a franchisee does before 10 a.m., they aren’t driving performance. They’re decoration.

THE VISIBILITY ILLUSION

When I was CTO for a franchise brand, we asked franchisees and business coaches what determined success. Then we ran a correlation study comparing the top 10% and bottom 10% of locations. Comparing the “gut metrics” to the correlated data, some KPIs held up. Most others didn’t. The real differentiators weren’t always the ones people assumed. The lesson was simple: More data isn’t the answer. The right leading indicators are. The opportunity isn’t better reporting. It’s building decision systems.

THE FIVE METRICS

High-performing systems narrow focus to a handful of leading indicators that inf luence revenue directly: • Speed to first response. Response time is a competitive advantage. When a prospect reaches out, the clock starts immediately. Consistent speed increases appointments and closings. • Appointment-to-close ratio. If appointments are high but closings are low, coaching is needed. If both are low, marketing is likely 58 | Franchise Update | Issue 2, 2026

ENCOURAGE CONSISTENCY

What’s your franchise business coach ratio? One coach for 20 locations? 100? Technology can now serve as a scalable, daily coach inside every unit = 1:1. A true decision engine doesn’t just show performance. It nudges behavior:

t’s Monday morning. A franchisee logs into the brand dashboard and sees 42 metrics, three graphs, and a 28-page performance PDF waiting in their inbox. They close it and answer the phone. No changes. No improvements.

Many brands believe visibility equals value. They build dashboards and send monthly KPI reports. Two problems: lagging data and wrong data. Revenue, close rate, and monthly trends are outcomes. They explain what happened. They don’t prevent what’s about to go wrong.

That’s not a report. That’s a decision list. Modern platforms are evolving from dashboards into decision engines.

the issue. This metric isolates execution gaps quickly. • Review response compliance. Customer experience is public. Failure to respond to reviews erodes brand trust. This is measurable and enforceable. • Follow-up adherence. Revenue often leaks in missed follow-up. Technology should track whether required touches actually happen and flag when they don’t. • Customer reactivation rate. The lowestcost revenue opportunity is often sitting in the existing database. Systems that trigger reactivation convert dormant contacts into recurring revenue. These are not just performance metrics. They are behavior metrics.

REAL TIME

The transformation happens when technology stops displaying metrics and starts triggering action. Imagine a franchisee opens their system and sees a prioritized action queue: • Three new leads have not been contacted within five minutes. • Two past customers are due for reactivation. • One negative review needs a response. • Follow-up compliance dropped below brand standard yesterday.

Franchisees don’t need to study green metrics. They need to know what’s off track. Exception reporting highlights deviations from standards instead of flooding operators with averages. Instead of saying, “Average response time: 18 minutes,” the system says, “You exceeded the five-minute standard nine times yesterday.” That moves the conversation from awareness to accountability.

AI AS COACH

AI adds a final layer. Not: “Conversion rate dropped 6%.” But: “Conversion has declined over the past 14 days. Missed second follow-ups are the likely cause. Recommend activating the prescribed three-touch reengagement sequence.” That’s not reporting. That’s scalable coaching.

THE BIGGER IMPACT

When franchisors shift from reports to decision architecture, results compound. Performance becomes more predictable, standards become enforceable, coaching becomes systematic, and underperformance is caught earlier. In an environment where buyers and private equity groups scrutinize operational maturity, predictability matters. The next era of franchising won’t belong to brands with the most data. It will belong to brands that turn data into daily decisions. Tomorrow’s winners won’t have the biggest reports. They’ll have technology that quietly tells every operator exactly how to win.

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Dennis Leskowski, CFE, is an author, speaker, and advocate for technology in franchising. A former brand CTO, he is currently the chief poduct officer for ClientTether, a franchisespecific CRM with automated sales channels and AI engagement.

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It’s Closing Time

Recruitment Rhythm

A systematic approach beats growth by guesswork Written by ART COLEY

ustainable growth is built on predictability. Yet for many brands, franchise development swings between momentum and slowdown. For one quarter, the pipeline feels full. In the next quarter, discovery days are canceled. Training classes fill and then sit empty. Forecasts rarely match reality. That is not a marketing problem. That is not a sales problem. It is a rhythm problem. Recruitment rhythm is the point when your entire franchise recruitment process runs smoothly and predictably from lead generation to signing the right franchise agreement with a candidate who meets your nonnegotiables. It happens without fire drills, without guessing, and without executive panic. When recruiting rhythm exists, it works like breathing. You do not think about it. It simply happens. Leads come in, appointments are set, sales conversations move forward, conversions occur at the expected rates, discovery days happen on schedule, franchise agreements get signed, and training classes fill predictably. I have addressed recruitment rhythm before, yet it continues to come up in conversations with franchise owners across the country, which tells me it remains widely misunderstood. Recruitment rhythm begins at the top of the funnel, where leads arrive consistently and appointment setting converts them at the right rates. Sales professionals then move qualified candidates through the discovery process with discipline. For organic web-generated digital marketing leads, brands should convert approximately 30% of top-offunnel leads into a kept Step 1 call, a meaningful 45 to 60-minute conversation that sets the tone for the relationship. Of 100 organic leads: • About 30 of them turn into a maintained Step 1. • Step 1 to application fulfills set goals. • Application to discovery day is still predictable. When recruitment rhythm is present, the time between discovery day and signing aligns with historical benchmarks. Each step advances at a predictable pace. If top-of-funnel conversion is weak, everything downstream becomes costly 60 | Franchise Update | Issue 2, 2026

PAYOFFS OF PREDICTABLE FRANCHISE DEVELOPMENT • Consistent quarterly franchise signings • Forecast accuracy within 5 to 10% • Higher return on marketing investment • Stronger franchisee quality and alignment • Sustainable enterprise value growth

and inefficient. Marketing dollars are wasted. Sales teams grow frustrated. Forecasts miss the mark. Predictability is what recruitment rhythm is all about.

WHERE TO START

Data is the starting point. You cannot fix what you cannot see. Many franchise companies attempt to solve problems without clarity around their numbers. They cannot clearly explain cost per lead, scheduling percentages, discovery day qualification rates, or signing percentages. They cannot forecast six to nine months out with confidence. If you cannot connect the dots from lead to signing by the math, recruitment rhythm will remain out of reach. Once you understand your historical performance and current state by the numbers, you can make faster and better decisions. You know where the gaps are, where to deploy resources, which behaviors require coaching, and which systems need refinement. Recruitment rhythm is not luck. It is math, discipline, and execution. Recruitment rhythm also requires the right training. Many franchise recruiters have never been properly trained on how to conduct a strong Step 1 conversation, guide a prospect through the FDD,

or design a discovery day that educates rather than pressures. If discovery day becomes a closing event instead of a clarity event, you may sign deals, but you will not create rhythm. True rhythm requires alignment across lead generation, appointment setting, sales execution, and coaching. Forecasting discipline is crucial. When your forecasts consistently land within 5 to 10% of actual performance, you are approaching the right cadence for franchise development. Recruitment rhythm maximizes your investment in franchise development and strengthens everyone connected to your brand. When rhythm exists, franchisees enter onboarding with clarity and confidence. Shareholders see a predictable return on investment. Vendor partners engage more deeply. Team members feel momentum and opportunity. Strong leaders are drawn to brands that demonstrate discipline and consistency. One strong month followed by three weak ones is not rhythm. A full training class followed by cancellations is not rhythm. A surge of leads followed by silence is not rhythm. Rhythm is consistency. It is quarter-after-quarter performance that aligns with your forecasts. It is knowing what is coming because the system is working. Ask yourself honestly, “Is recruitment rhythm happening in my brand today?” If results feel random, if you are constantly reacting instead of executing, or if your forecasts regularly miss the mark, then rhythm has not yet been achieved. The good news is that recruitment rhythm can be achieved. Recruitment rhythm is available to any franchise company willing to be disciplined with its data, honest about its gaps, and committed to execution. It requires clear goals, accountability, and strong leadership. At the end of the day, franchising is about helping people improve their lives through small business ownership. Recruitment rhythm ensures you are signing the right franchisees at the right pace with the right expectations. It creates stability. It builds confidence. It strengthens enterprise value. Let’s go to work!

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Art Coley is the CEO of CGI Franchise. Using the proven Recruitment Operating System (ROS), Art and the ROS team help franchise companies implement and execute a predictable, repeatable, and sustainable franchisee recruitment program. The company is based in Temple, Texas, and works with brands worldwide. Contact Art at 281-6589409 or acoley@cgifranchise.com.

JUNE 2- 4 2026 INTERCONTINENTAL BUCKHEAD

INTRODUCING THE NEW FRANCHISE GROWTH & MARKETING CONFERENCE

Formerly the Franchise Customer Experience Conference (FCXC), FGMC is the new event for marketing leaders with a clear focus on unit-level-economics, collaborative learning and leveraging technology to drive growth. Franchise marketers face a new reality. Customer acquisition costs are rising, AI is reshaping expectations, and marketing technology is becoming more expensive and complex. At the same time, franchisees are demanding clearer ROI from brand marketing – and corporate strategy doesn’t always translate into unit-level profit. To address these changes, we’ve created FGMC. FGMC brings together marketing leaders responsible for driving demand, growth and profitability across franchise systems, from the C-suite to the team supporting brand development, local execution and customer experience across locations.

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Franchise marketing isn’t about campaigns anymore—it’s about building systems that drive revenue, franchisee profitability, and sustainable growth across the network. Customer acquisition costs are rising. AI is reshaping how brands compete. And franchisees expect marketing to deliver real results – all the way to the unit level P&L. If you are responsible for delivering profitable franchise growth, the Franchise Growth & Marketing Conference will help you rethink your systems, strengthen your team, and return to your brand with ideas that move the numbers that matter.

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Customer acquisition costs are rising. AI is moving faster than teams can adapt. Martech is expensive and underutilized. Franchisees want proof of ROI. And too often, corporate marketing strategy doesn’t show up as unit-level profit. The Franchise Growth and Marketing Conference (FGMC) exists to close that gap. FGMC brings together franchisor CMOs, C-suite leaders, brand presidents, and marketing, field ops, CRM, loyalty, and martech teams to focus on one thing: profitable growth at

the unit level. Built from the unit P&L up, the conference connects marketing spend, technology, and execution directly to location-level performance. Through Growth Pathway workshops, learning labs, and real-world case studies with franchisors and supplier partners, attendees get practical, data-driven insight into what actually drives traffic, optimizes spend, and scales results. Team-friendly pricing allows leadership teams to align, learn, and attend the conference together.

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Providers. Our exhibit hall is the central meeting place for Multi-Unit Franchisees to explore new brands and supplier services. With worldclass speakers and timely learning sessions, this is the must-attend event every year for Multi-Unit Franchisees looking to grow their operations and expand their portfolios.

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