How are franchisees coping?

Last year, when Covid-19 first hit and New Zealand was plunged into its first Level 4 lockdown, there was a fair amount of fear and alarm among business owners around the country. Franchisees at least had their colleagues to turn to for support, and franchisors rapidly found that the need for support turned from operational and marketing information to how to apply for subsidies, how to negotiate with landlords, and how to enjoy suddenly-enforced family time. 

V.I.P. Home Services were one of the first companies to react, extending their support not just to franchisees but to their families as well with activity packs for kids, recipes and more (see Helping Franchisees #1). 

Well, the country got through that and most businesses recovered strongly. New Zealanders have since enjoyed a great deal of freedom compared to much of the rest of the world, so it came as a nasty shock when, in August, we went back into Level 4 again – this time, with only a few hours’ notice. So how did franchisees feel this time? Estelle Logan of V.I.P. decided the only way to find out in her business was to ask them.

Less anxious

‘The feeling we got from our franchisees was that they didn’t have the same level of anxiety as before,’ says Estelle. ‘Most of them have been through it before, know that business bounced back last time, and also know that there’s support and resources they can draw on if required. 

‘But at the same time, we recognised that people’s situations might have changed since last year. They might have bought a new home or started a family. They might just have bought the franchise, or still be in training, or working through their guarantee period. So we felt we needed to know how each franchisee was really feeling.’

Estelle’s solution was simple. During online meetings with their 120-plus franchisees in the first week of lockdown, V.I.P. conducted a survey asking franchisees to answer seven key questions. They had a 90 percent response rate, and the results make interesting reading.

1. Are you still working?

V.I.P. franchisees cover both the cleaning and lawnmowing sectors. Although domestic cleaning isn’t possible in both Levels 4 and 3, some 6 percent of cleaning franchisees were still able to work to some extent as they had clients providing essential services. Lawnmowing is not possible in Level 4 but is in Level 3.

2. How do you feel about this latest lockdown, on a scale from 1 (extremely anxious) to 10 (feeling great)?

The average was 7.2 – ‘Feeling good’. 84 percent of franchisees were very positive, rating themselves in the 8-10 range. 16 percent rated themselves as anxious. 

3. Do you watch the 1pm news?

In 2020, the 1pm press conferences were must-watch viewing. This time, 70 percent said yes, 30 percent said no. Franchisees are more relaxed.

4. Are you watching the news more frequently?

Only 10 percent of franchisees were making a point of watching news more than three times daily.

5. Do you feel in need of emotional support?

3 percent of franchisees said they did want support – something which V.I.P. offered last time through a variety of means, including an immediate access button on their phones. This has been made available again. 97 percent of franchisees felt they had "got this".

6. Do you feel in need of financial support?

The Government Wage Subsidy and Resurgence Support Payment are critical to small business, and apply to franchisees as well as employees. They reduce stress and create certainty. Again, accessing the financial support available from the Government is something we all got used to last time, when it turned out to be easier than expected. This time, 89 percent needed no support, but 11 percent wanted help.

Remember, though, that this survey took place in the first week of the national lockdown, and V.I.P. expects that response to change as the lockdown periods extend. Estelle says, 'Having applications for a second Wage Subsidy open on 3 September will help, but we expect that franchisees will look to us for fee relief, as we provided last year.'

7. Are you facing challenges at home due to Covid? 

While 89 percent were fine, 11 percent said there were additional challenges eg. childcare, supporting essential workers, etc. ‘Those are franchisees who may need more support and contact from us as franchisors,’ notes Estelle.

8. Do you feel you are at risk from Covid?

84 percent said no, 16 percent said yes. Additional support and advice may be required for the 16 percent (who might be working or living with essential workers), along with checking that they have adequate supplies of PPE.

9. Have you booked or had the vaccine?

65 percent said yes, 35 percent said no. At the time of the survey, bookings had not been opened up to all age groups.

Tailored response

Estelle sums up. ‘What our survey did was show us the people we needed to focus on first, to help them get through the uncertainties of the different level changes. We know from last time that the business is resilient but new franchisees, in particular, were understandably worried.

‘As franchisors, when Level 4 started we knew that a lot of the hard work had already been done; the processes we developed last time, and had developed during the various alert level changes since, were all ready to roll out again. That reduced anxiety all round.

‘Listening to other franchisors, I think many of them have had the same experience. We are looking at what we did last time and saying, is there anything we could do better? Communication, with both franchisees and customers, is vital to help keep everyone on the same page.

‘At the same time, as our survey showed, different people have different needs. It’s not the same shock for everybody, so we’re able to take a more targeted approach to help the people who really need support. But everybody learned a lot last year and most of our franchisees don’t need their hands holding – they are business owners, and we treat them as such. They know that their customers are waiting for them.’

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