Franchisee profitability is
undoubtedly one of the
hottest topics in franchising
today.
In an environment of ever increasing
competition across all markets in which
franchise businesses operate, there is great
value in recognising the many small things
that franchisees can do that can add up to a
big difference in their financial performance.
David Campbell of Avatar Consulting is
a renowned franchise profitability expert
who hosts regular financial workshops at
Griffith University’s Asia Pacific Centre for
Franchising Excellence.
Known as ‘the metrics master’ for his more
than 30 years of hands-on experience in
working with franchisees to boost their
bottom-line performance, David uses many
practical tools to demonstrate the little actions
that can deliver big gains in profitability.
At his regular Franchisee Financial Essentials
Workshops, this includes highlighting the
‘power of ones’ via the following three
questions:- Could you increase sales by one per cent?
- Could you improve your margin by one per
cent? - Could you reduce operating expenses or
increase efficiency by one per cent?
David says he has never had a franchisee
say no to any of these questions, but they
are shocked when he explains that these
three little ‘ones’ combined can increase a
franchisee’s profitability by an impressive 26
per cent.
This is just one highly-effective example of
the way that David engages with franchisees
to improve their understanding of the key
financial figures underpinning their business.
With this invaluable knowledge on board,
franchisees are empowered to move forward
on a successful path of ongoing profitability
and growth.
According to David, boosting franchisee
profitability can also be as simple as improving
their understanding of the key profit
indicators of their franchise business using the
four forces method, comprising of: Thrust
(Sales); lift (Cost of Goods Sold + Margin);hAve Your sAY
the ‘poWer oF ones’
Can make the diFFerenCe