Necessity is the mother of invention– when a business faces a crisis, it can easily discover new solutions. Challenges help us explore opportunities that eventually catalyze growth. But what happens when growth is no longer there and surviving becomes the primary focus?
Businesses typically go through crises in absence of growth. A crisis can come as a cybersecurity breach, conflicting interests, losing a client, bad debt, and more. The way you respond to a crisis within a franchise determines whether your business will survive the storms or close down. It’s important to contact a franchise lawyer for legal counsel when experiencing franchising challenges.
5 Ways to Prepare for a Crisis in Franchising
The coronavirus pandemic presented challenges for many organizations—particularly the technologically challenged businesses. However, a study conducted by McKinsey & Co. research showed that many businesses turned their challenges into stepping stones and experienced significant growth even with the global economic crisis. Franchised businesses can integrate the following measures to handle any crisis successfully.
- Consulting and Networking
Human capital is the best resource any company can get and integrate them in the process would be invaluable to a franchise. Consulting peers, other CEOs, business mentors, industry shapers, and subordinates can provide ingenious ideas that can help a company in times of a crisis. Creative solutions and ideas can come from anywhere.
Remember to withhold sensitive insider information although you’ll need to divulge certain facts to get help. Besides, consulting workers or integrating them into the crisis management process and important business issues empowers them, reduces employee turnover, increases longevity at the workplace, and promotes employee satisfaction.
- Managing Customer Relationship
It’s common knowledge that the survival of a business depends on its clients. Research shows that 80% of a company’s revenue comes from 20% of its customers. A thriving relationship between a client and the company makes the customer loyal and they’re bound to stick with you at all times, even when facing a crisis. Customers can be retained through the following ways:
- Protecting the interests of clients;
- Addressing clients’ complaints promptly to increase their faith in the organization;
- Reaching out to customers and enquiring about the areas you need to improve;
- Assuring clients that you’ll overcome difficult times during a crisis;
- Ensuring customer privacy and trust are upheld;
- Providing regulatory compliance disclosure;
- Apologizing when wrong.
- Choose Qualified Personnel to Handle a Crisis
Choose qualified personnel who can handle the crisis. The selection criteria should focus on technological qualifications and field experience to come up with a dynamic and creative team to handle the problem and find a lasting and appropriate solution.
- Prioritize the Long-Term Goals
Bad times and crises do not last forever–they somehow come to an end–meaning the remedies should offer long-term solutions to promote the trust of employees, clients, and other stakeholders. Maintaining operating cash balances is a crucial part of prioritizing long-term goals because third-party financial resources, such as bank loans and investment income can falter in times of a crisis. In other words, your financial security should be guaranteed by evaluating the likely worst-case scenarios and formulating a survival strategy for such scenarios (crises).
- Seeking more Opportunities (Innovation)
Most franchised businesses closed operations during the recent COVID-19 pandemic while others continued thriving thanks to being innovative. For instance, Apple developed a watch that could detect early signs of Corona infection and made a fortune.
Having a competent Research and Development team can be invaluable in times of a crisis. Another good example is where most bars, breweries, and local pubs started selling sanitizers following the COVID-19 restriction guidelines that forced most alcohol-focused businesses to operate below capacity.
Benefits of Hiring an Attorney
The benefits of hiring an attorney when handling an internal crisis, such as a dispute can include:
- Experience
Lawyers encounter similar legal situations every day, and they might have encountered a case similar to yours. They’re also familiar with what works and the measures to take for your case. Did you know that most lawyers can foretell whether you’ll win or lose a case?
- Legal Advice
A lawyer can help interpret the law and help you understand its impact on your legal situation. Your lawyer will evaluate your case and recommend the best legal option to resolve the internal crisis or dispute that you might be experiencing.
- Having an Attorney Eliminates Costly Litigations
Involving a franchise attorney from the onset helps a franchise avoid costly litigations because the in-house attorney will be available to provide workable solutions even when the main parties to a franchise–franchisor and franchisee, are not in talking terms.
- Legal Connections
Lawyers have networks of professionals whom they consult on various issues, such as investigators, doctors, accountants, and much more–meaning situations that require the expertise of such professionals can be resolved easily.
Encountering a crisis in the course of business is normal and it doesn’t mean that you’re a failure because of a challenge. How you handle business challenges is what matters.
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