Franchising Failure: How to Prevent High Staff Turnover

Opening a new franchise location and getting through the grand opening and the first few months of operation is one thing. But staying in business, flourishing, and dominating your niche in the local market for years is another.

Failure among franchises is far less common than among start-ups, but it happens. When it does, one of the main reasons is a high staff turnover rate.

The Importance of Preventing Employee Turnover

Preventing employee turnover should rank among your highest priorities when becoming or continuing as a franchisee. Choosing a top-tier franchise brand to begin with, such as Great American Cookies, starting off with enough capital and financing, and forming a detailed, realistic business plan are all important, too. But without a reliable, competent, hard-working crew to staff your positions, your business will suffer.

How does low employee retention hurt your business? Here are a few ways:

  • It costs you about twice as much (or more) to find, hire, and train a new employee as paying the wages of one you already have.
  • High turnover lowers the morale of your remaining employees. This makes it more likely that they will leave soon after or that their performance will suffer.
  • Employee loss sometimes leads to customer loss. This is because many customers frequent an establishment as much for the employees as for the goods or services it offers.
  • You and your managers will have to spend valuable time keeping new employees coming in to replace those who just went out. However, that time could be devoted to managing the business, which ultimately helps things run more smoothly.

7 Strategies for Preventing Employee Turnover

Given the importance of preventing employee turnover, it makes sense to implement some key strategies to try to curtail it. Here are seven strategies:

  1. Hire smart to begin with. The number one way to prevent high staff loss is to carefully interview and vet potential employees. This ensures they have the right skills and are the right “fit” from the get-go.
  2. Offer competitive compensation. Only by offering mid- to high-end pay and benefits packages can you hope to draw in and retain the top talent. Dedicated employees want managers to recognize their efforts. They will eventually drift away if this does not happen.
  3. Prevent employee burnout. Giving employees extra hours can be an incentive for them to stay. But overloading them with unreasonable hours can lead to burnout and turnover.
  4. Be as flexible as possible. To keep good employees who have been with you for some time, it is helpful to allow them some flexibility in choosing their hours so they can maintain the rest of their lives along with their work lives.
  5. Recognize employees’ accomplishments. Some workers will work on diligently indefinitely without any praise, recognition, or encouragement. Most will not. Awards, bonuses, emails, and postings of which team or individual excelled that week/month are all ways to give recognition.
  6. Allow avenues for feedback. Feedback from employees can be positive or negative. Give staff a proper channel through which to voice their concerns. Learn from both the good and the bad feedback.
  7. Give hard workers hope. By providing clear paths forward for those interested in long-term careers in your company and clear milestones along the way, you give your employees hope of advancement and a reason to stay.

In sum, choose your employees carefully and then give them plenty of good reasons to stay. You’ll find that your franchise business will reap the benefits. To find out how you can open a franchise with Great American Cookies and for more tips on retaining employees, visit our website!

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Great American Cookies is a part of the FAT Brands Family, which also holds the following Quick Service Restaurant brands:

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This information is not intended as an offer to sell, or the solicitation of an offer to buy, a franchise. It is for information purposes only. Currently, the following states regulate the offer and sale of franchises: California, Hawaii, Illinois, Indiana, Maryland, Michigan, Minnesota, New York, North Dakota, Oregon, Rhode Island, South Dakota, Virginia, Washington, and Wisconsin. If you are a resident of or want to locate a franchise in one of these states, we will not offer you a franchise unless and until we have complied with applicable pre-sale registration and disclosure requirements in your state. Franchise offerings are made by Franchise Disclosure Document only..

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