Our fickle economy is causing many multi-unit franchisees to wonder what is the best strategy to achieve their business and personal goals. The pandemic impacted us all, causing some to reap the benefits and others to be shut down. Thanks to strong employment gains, the waning effects of the pandemic, and household spending savings, consumer spending has so far remained healthy despite high price pressures. As the world evolves and changes, basic principles stay the same, such as processes, procedures, marketing, talent, attractive culture, capital, etc.
In an interview with Jeff Bannon, a succession planner with The Rawls Group and Michael Einbinder an attorney with Einbinder & Dunn LLP, the topic of protecting and growing a franchise or company was discussed. The two provided insights based on past and current experiences working with multi-unit franchisees.
Michael Einbinder was asked, “What are things I can do today as a business owner to consider the possible, probable, and potential issues impacting my business as the economy potentially changes or does not?”
His reply, “Everyone takes this time a bit differently, there is a short term and a long-term view. There are risk averse people who want to hold their cards for now, and there are people who want to be more aggressive and have a long-term view of things and they may make different decisions.”
Einbinder then elaborated on the two viewpoints:
- “For some people who are worried about getting money and acquiring capital the best thing to do is maybe hold your cards.”
- “For people who want to be a bit more aggressive and take some more risks, the thing would be to maybe buy things or look for things you can buy at a price that is a little better than it would have been in the past.”
When asked for some insight on how a multi-unit franchisee can protect their investment and possibly grow during this business environment, Jeff Bannon took the time to break this question down into two separate ideas: protection and growth.
- “From a protection standpoint, protecting the business means you have processes in place, people in place, and financial capital to make sure the business can sustain in your absence. “
- If someone inherits the company with no operational experience, and the company decides to sell to the market and the predictability of cash flow has gone down, owners will have to sell at a lower value price. That said, getting your personal affairs in order is fundamentally the best way to protect the value.
- “There are really three components to growth: people, processes, and financial capital.” Bannon talked about why the people aspect of growing your business is so important, elaborating on this thought through this quote, “If an opportunity falls in your lap that is too good to be true, do you have the manpower to do this?”
Regardless of the state of your business, while facing the current economic situation in the U.S. and globally, multi-unit franchisees often must consider the direction and goal of their business. In today’s world, not having a structured plan in place can be the difference between a successful and unsuccessful business.
Kendall Rawls knows and understands the challenges that impact the success of an entrepreneurial-owned business. Her unique perspective comes from her educational background and, more importantly, from firsthand experience as a second-generation family member of The Rawls Group – Business Succession Planners. For more information, visit www.rawlsgroup.com or email email@example.com.