Franchises are more successful if they can take advantage of scale, scope and location, among other factors. Consistency in operational effectiveness delivers higher value for the individual franchisee as well as the franchisor, and mostly for the franchise. AEG’s approach to diagnosing hidden value gaps and applying the proper suite of skills, tools and resources can deliver growth in enterprise value.
Is growth stalled at one or more locations, or is there a systemic problem across all franchisees? Is it an owner issue, or technology, or financial? Why are some locations doing better financially that others? Is financial performance correlated with operational effectiveness across the board or for just some functions? How would you know where the highest ROI improvement opportunities lie without a good diagnostic?
Consider the value drivers known to be the key to growth and increased business valuation. In a franchise, some drivers are the responsibility of the franchisor, others the responsibility of the franchise, and for others are a shared responsibility. A valid evaluation of performance across all 18 drivers provides a common understanding and shared language of how to improve performance, regardless of responsibility.
With this insight, a systematic value growth plan can be put in action and increased enterprise value tracked. Done well, efficient action leading to growth in response to this diagnostic can benefit the franchise, franchisors and franchisees.