Coronavirus and Franchising Webinar: Jason Mazzarone and Scott Thompson

Businesses of all sizes are continuing to come to terms with the disastrous effects of the Coronavirus outbreak this week, and franchise brands both big and small are scrambling to strategize ways to stay ahead. 

To that end, 1851 Franchise publisher Nick Powills and Charles Internicola, founder and partner of the Internicola Law* Firm, are covering the Coronavirus and its impact on the franchising industry through a webinar series titled “Coronavirus and Franchising: Mindset + Strategy to Recover and Grow.”

In today’s second webinar, Powills and Internicola spoke with Jason Mazzarone, founder and CEO of Sobol, and Scott Thompson, Chief Development Officer of Big Blue Swim School*, both of whom offered insights for emerging brands trying to survive in the franchising industry.

Here are the key insights from their discussion.

How Emerging Brands are Dealing with the Crisis

For emerging brands, surviving a crisis of this magnitude in their earliest days can create a strong mindset and robust infrastructure for the future. It is important to lean on the expertise of mentors and those who have weathered storms before.

With limited resources, it is important to be smart with marketing dollars and to prioritize strategies that will bring business to franchisees. For example, when social-distancing measures are relaxed, Big Blue Swim School plans to implement an aggressive marketing campaign to appeal to consumers looking to get their kids back into swim lessons right away.

The first question most franchisees ask franchisors in a crisis like this is about royalty deferment. It is important to educate franchisees on how royalty funds are helping support the business and keep staff employed. There is a responsibility that comes with staying open.

While sales may be down significantly, staying open helps emerging brands maintain momentum. Plus, this is a good time to work on internal and consumer-facing procedures in order to support existing franchisees and return stronger than ever after the crisis. For example, SoBol has been implementing new off-premises strategies, such as curbside pick-up, to keep revenue coming in for franchisees and to keep stay top-of-mind for customers even while dining rooms are closed..

How to Support Franchisees

Right now, quality franchisee-support is all about providing resources, educating franchisees about SBA loans, developing programs and letting franchisees handle things locally when appropriate.

Leaders have an obligation to focus on building a strong runway so that franchisees can land safely once this is all over. 

Bringing energy and optimism to motivate the team is a serious job, now more than ever. 

Prioritizing Franchise Development

Many franchisors may be pumping the brakes on franchise development, but those franchisors will need to play catch-up later. Now may be a time to slow franchise development, but it isn’t a time to stop completely. There will always be buyers. 

If you do slow your development efforts, use the down time to flesh out internal processes and implement better development practices so your team can come back smarter than ever. 

Instead of focusing primarily on leads, it is more important now to ensure that franchisees currently in the development pipeline are able to cross the finish line.

Some good news: real estate prices could become more affordable. For example, Big Blue anticipates an increase in available big-box retail locations as well as a decrease in interest rates, which could be a positive factor for incoming franchisees. 

How to Create a Strategy for the Future

Every brand will be remembered for what they do during this crisis. Brands that support owners and create positive storytelling during events like this will do the best in the long-term. Remember, franchisees sell franchises. Support them today, and they’ll be your best sales tool tomorrow.

When reacting to a crisis, you have an opportunity to improve your systems. Franchisors are now forced to adapt. Use this opportunity to create new avenues of growth and stabilization. Franchisor conversations are already turning toward the future, but they should not be focusing entirely on development for at least the next couple of weeks. Now is the time to sure up systems so when franchisors do begin ramping up development, they have the most lucrative proposition for prospective franchisees.

Franchisors may defer franchise fees to get more people into the pipeline and engage with dead leads. There may also be an uptick in resales with savvy franchisees trying to recoup their investment at a discounted price.

Stay positive, be there for the people you work with. A lot of us will be better for this. There is a light at the end of the tunnel for franchising. The question now is: how do we get there? 

To register for all of this week's Coronavirus and Franchising webinars, click here.