Benchmarking your franchise business
To run a business successfully, you should measure its performance and compare against the industry averages. In order to achieve this, more and more businesses are turning to benchmarking as it can beat the competitors at their own game. Using key performance indicators the franchisees will be able to compare the performance of their business with their competitors.
To compare the performance or results of competitors, financial figures are converted into ratios through benchmarking. Benchmarking allows discovering areas of development.
How do you benefit
Benchmarking can provide a detailed analysis to any business whether a supermarket, printing franchise or a coffee franchise. No business is too small or too big for benchmarking analysis. Benchmarking is used as a measuring stick for improvement by business owners. To improve the performance of their franchise, franchisees can use or compare information from other franchisees through benchmarking.
Buying a franchise
While buying a franchise, you should examine and compare the other franchises in the same industry. To find out fundamental problems, look at indicators like rent as a percentage of turnover and wages for profitability measures and return on investment.
It is always better to benchmark yourself against the best in the industry so that you that you can reach them and do even better.