In franchising, growth is often spoken about in sweeping, almost romantic terms. Coast to coast. Nationwide presence. Hundreds or thousands of locations dotting the map. Those aspirations sound impressive, and in some cases they are justified. But there is a quieter, more disciplined ambition that rarely gets talked about publicly, even though many of the strongest franchise systems ultimately follow it. That ambition is not to be everywhere, but to be unmistakably dominant somewhere.
You rarely hear franchisors say their goal is to become the largest franchise brand in a city, a state, or a region. Yet when you look closely at brands that are truly healthy, profitable, and operationally sound, many of them first focused on saturating a defined market until the brand became a household name. This is not accidental. It is deliberate franchising.
Deliberate franchising starts with the recognition that scale is not just about distance, it is about density. A brand with ten locations spread across five or six states may technically be “multi-state,” but it is not truly scaled. It is scattered. Each unit operates in isolation, franchisees are often far removed from one another, and the franchisor’s support team is stretched thin trying to serve operators who may be hundreds or even thousands of miles apart. The optics of expansion exist, but the infrastructure rarely keeps pace.
Contrast that with a brand that chooses to dominate a city or a state. Multiple locations within a tight geographic footprint create operational leverage almost immediately. Field support becomes more effective because visits are efficient and frequent. Training improves because new franchisees can learn from nearby peers, not just manuals and webinars. Best practices spread faster when operators see them working down the street rather than hearing about them on a monthly call.
Marketing is where localization truly shines. A concentrated market allows a franchisor to build real brand awareness instead of fragmented impressions. Advertising dollars work harder when multiple locations benefit from the same message in the same media market. Local PR becomes meaningful because the brand shows up repeatedly, consistently, and visibly. Over time, the brand stops being “a franchise in town” and starts becoming “the brand” in that category. That kind of recognition is almost impossible to achieve when locations are scattered across distant markets with small, disconnected budgets.
There is also a franchisee confidence factor that often goes overlooked. Prospective franchisees are far more comfortable investing in a brand they see everywhere locally than one they have to imagine succeeding from afar. Existing franchisees feel supported when they know the franchisor’s attention is not diluted by distant outposts. Performance benchmarks become more accurate when units operate under similar market conditions, rather than trying to compare results from vastly different regions.
Deliberate franchising does not reject growth. It simply reframes it. The goal is not to rush toward a national footprint but to build a repeatable model of market dominance. If a brand can successfully saturate a city or a state, refine its systems, prove its unit economics, and establish itself as a local authority, that success can be replicated. One state becomes two. Two become four. Each expansion is intentional, supported, and informed by real experience rather than ambition alone.
This approach also forces franchisors to mature faster. Weak operations are exposed quickly when locations are clustered. Ineffective marketing cannot hide behind geography. Support gaps become obvious when franchisees are close enough to compare notes. While this can feel uncomfortable early on, it ultimately strengthens the system and prepares it for broader expansion when the time is right.
Scaling locally before scaling nationally is not a lack of vision. It is a different kind of vision, one grounded in sustainability, brand strength, and long-term franchisee success. Becoming coast to coast is not a strategy. It is a result. And more often than not, the brands that get there are the ones that first chose to win at home.
About the Author
Paul Segreto brings over forty years of real-world experience in franchising, restaurants, and small business growth. Recognized as one of the Top 100 Global Franchise and Small Business Influencers, Paul is the driving voice behind Acceler8Success Café, a daily content platform that inspires and informs thousands of entrepreneurs nationwide. A passionate advocate for ethical leadership and sustainable growth, Paul has dedicated his career to helping founders, franchise executives, and entrepreneurial families achieve clarity, balance, and lasting success through purpose-driven action.
About Acceler8Success America
Acceler8Success America is a comprehensive business advisory and coaching platform dedicated to helping entrepreneurs, small business owners, and franchise professionals achieve The American Dream Accelerated.
Through a combination of strategic consulting, results-focused coaching, and empowering content, Acceler8Success America provides the tools, insights, and guidance needed to start, grow, and scale successfully in today’s fast-paced world.
With deep expertise in entrepreneurship, franchising, restaurants, and small business development, Acceler8Success America bridges experience and innovation, supporting current and aspiring entrepreneurs as they build sustainable businesses and lasting legacies across America.
I recently heard a C-level franchise executive say, without hesitation, that he hated franchisees. The comment lingered with me far longer than it should have, not because it was shocking for shock’s sake, but because of what it quietly revealed. People do not arrive at hatred casually. Hatred is not a momentary reaction or a throwaway frustration. It is the final stage of a mindset that has been forming for a long time. What disturbed me most was not the statement itself, but the culture that must exist for that statement to feel acceptable, even logical, in the speaker’s mind.
Franchising does not function without franchisees. They are not adjacent to the model. They are not downstream participants. They are the model. Every location opened, every customer served, every employee hired, every dollar earned in the field is the direct result of a franchisee’s daily decisions and personal risk. When a franchisor reaches a point where resentment replaces respect, the system has already drifted far from its original intent. That drift rarely announces itself. It happens quietly, through small decisions, unchallenged assumptions, and leadership habits that go unchecked.
At the heart of the issue is a fundamental misunderstanding of what franchising actually is. Franchising is not a control mechanism disguised as growth. It is not a way to scale without responsibility. It is not a license to dictate without listening. It is a partnership model built on shared risk, shared reward, and shared accountability. When that truth is ignored, franchisees stop being seen as entrepreneurs and start being viewed as obstacles. Once that mental shift occurs, every disagreement feels like defiance, every question feels like resistance, and every challenge feels personal.
Culture always reveals itself through language. If an executive can say he hates franchisees, what language is being used internally when franchisees are not present? How are they described in meetings, emails, and private conversations? Are they talked about as partners trying to succeed, or as problems to be managed? Are struggles in the field treated as signals that support systems need improvement, or as proof that franchisees are incapable of execution? The answers to those questions define whether a system is built on leadership or control.
Many franchisors reach a stage where complexity increases and patience decreases. Growth brings pressure. Pressure exposes insecurity. Insecure leadership often responds by tightening its grip. That grip shows up as heavier compliance, stricter enforcement, and less tolerance for feedback. Over time, franchisees learn that speaking up carries consequences. They learn that silence is safer than honesty. When that happens, leadership stops hearing the truth and starts hearing only what reinforces its own beliefs. Eventually, frustration grows on both sides, but only one side holds the power to label the other as the problem.
What is often framed as “franchisee issues” is frequently a reflection of broken trust. Franchisees push back when they feel unheard. They resist when they feel disrespected. They disengage when they believe decisions are made for corporate benefit at the expense of unit-level viability. Compliance problems are rarely about rules. They are about belief. Franchisees comply more willingly when they trust that leadership understands their reality and acts in the best interest of the system as a whole.
There is also an uncomfortable truth that rarely gets acknowledged. Franchisees represent accountability. They live with the consequences of corporate decisions in real time, in real markets, with real financial exposure. They are the first to feel when a new initiative increases labor strain, compresses margins, confuses customers, or complicates operations. For leaders who equate authority with infallibility, that feedback feels threatening. Instead of being seen as insight, it is experienced as opposition. Over time, frustration with feedback turns into resentment toward the people delivering it.
When resentment sets in, leadership often seeks refuge in metrics and mandates. Numbers replace nuance. Policies replace conversation. Legal language replaces leadership presence. The system becomes more rigid at the very moment it needs flexibility. Franchisees feel the shift immediately. Calls take longer to return. Support becomes transactional. Communication becomes defensive. Trust erodes quietly until it becomes visible through conflict, attrition, or stagnation.
The most dangerous franchise culture is not one filled with loud critics. It is one filled with quiet survivors. Franchisees who stop offering ideas. Franchisees who no longer attend meetings with optimism. Franchisees who comply outwardly while disengaging inwardly. That culture does not produce excellence. It produces mediocrity protected by contracts. By the time leadership openly expresses contempt, the damage is already well underway.
It is worth asking why anyone would choose to franchise a brand if they fundamentally resent franchisees. Franchising demands humility. It requires the ability to lead people you do not employ, influence outcomes you do not directly control, and accept that your success is inseparable from someone else’s execution. Leaders who crave absolute control will always struggle in this model. Their frustration is not with franchisees. It is with the nature of shared power.
Healthy franchise systems are built on respect without illusion. Respect does not mean appeasement. It does not eliminate standards or accountability. It means recognizing franchisees as capable business owners whose perspectives matter, even when they are inconvenient. It means understanding that disagreement is not disloyalty and that questions are often a sign of engagement, not resistance.
Every franchisor should periodically confront a simple but revealing question. If you were not bound by contracts, if renewal were optional tomorrow, would your franchisees choose to stay? Not because of sunk costs, but because of trust, belief, and alignment. Culture is what holds a system together when legal structures are no longer the primary glue.
A franchise executive who says he hates franchisees is not simply expressing frustration. He is revealing a worldview. That worldview will shape decisions, communication, and priorities, whether acknowledged or not. It will influence how support is delivered, how conflicts are handled, and how success is defined. Over time, that worldview becomes culture, and culture becomes destiny.
The real work for franchisors is not fixing franchisees. It is fixing the environment in which franchisees operate. It is examining whether leadership behaviors invite partnership or enforce obedience. It is deciding whether the system values truth or comfort, collaboration or control. Franchising does not fail because franchisees are difficult. It fails when leadership forgets why franchisees exist in the first place.
Franchisees are not the enemy. They are the evidence. They are the living proof of whether a brand’s promises, systems, and leadership philosophies actually work. If contempt has replaced curiosity, the solution is not more enforcement. It is deeper reflection. Because the moment a franchisor begins to hate franchisees is the moment the franchise model itself is being quietly dismantled from within.
About the Author
Paul Segreto brings over forty years of real-world experience in franchising, restaurants, and small business growth. Recognized as one of the Top 100 Global Franchise and Small Business Influencers, Paul is the driving voice behind Acceler8Success Café, a daily content platform that inspires and informs thousands of entrepreneurs nationwide. A passionate advocate for ethical leadership and sustainable growth, Paul has dedicated his career to helping founders, franchise executives, and entrepreneurial families achieve clarity, balance, and lasting success through purpose-driven action.
About Acceler8Success America
Acceler8Success America is a comprehensive business advisory and coaching platform dedicated to helping entrepreneurs, small business owners, and franchise professionals achieve The American Dream Accelerated.
Through a combination of strategic consulting, results-focused coaching, and empowering content, Acceler8Success America provides the tools, insights, and guidance needed to start, grow, and scale successfully in today’s fast-paced world.
With deep expertise in entrepreneurship, franchising, restaurants, and small business development, Acceler8Success America bridges experience and innovation, supporting current and aspiring entrepreneurs as they build sustainable businesses and lasting legacies across America.
In my more than forty years in franchising, I have had the opportunity to serve in a wide range of leadership roles, including CEO, COO, and President, across organizations that experienced mergers and acquisitions, turnarounds, aggressive growth phases, and periods of steady, disciplined expansion. While those roles placed me squarely in the middle of strategic decision-making, I was always clear-eyed about where my greatest strengths lived and where they did not. My expertise was built through operations, franchise relations, marketing, and franchise development. When it came to complex financial engineering, capital structures, valuation models, and exit scenarios, I leaned heavily on what I often refer to as the smartest people in the room: seasoned Chief Financial Officers and highly capable financial consulting firms. That balance between operational leadership and financial rigor shaped many of the outcomes I was part of.
Over the years, I have also consulted with and advised a broad spectrum of franchise organizations, which has given me a better-than-average understanding of private equity’s expanding role in franchising. I have seen it from multiple vantage points: inside the boardroom, across leadership teams, through the eyes of franchisees, and from the perspective of founders who suddenly found themselves accountable to investors rather than to the systems they spent years building. What follows is written through that lens. It is not meant to be definitive, nor is it intended to indict or defend private equity as a category. There is certainly more to add and gaps to fill. But it is a conversation worth having, especially as private equity continues to shape the future of franchising in ways that are both powerful and deeply consequential.
Private equity’s growing presence in franchising is one of those topics that resists a simple yes-or-no conclusion. Like most things in business, it carries clear advantages alongside equally clear risks. Setting aside debates around deal structures, leverage ratios, and valuation multiples, the more important question is whether private equity ownership is truly compatible with franchising as a long-term system built on relationships, shared risk, and mutual success. That distinction matters because franchising, at its core, is not simply a growth strategy. It is a partnership model that depends on trust, alignment, consistency, and patience over long periods of time.
There is no denying the upside. Private equity has elevated franchising’s profile and reinforced what many operators and founders have long understood: franchising, when executed well, is a powerful and scalable business model. Institutional capital brings visibility, credibility, and access to resources that many brands could not achieve on their own. In numerous cases, private equity ownership has helped modernize legacy systems, professionalize leadership teams, improve financial reporting, introduce data-driven decision-making, and accelerate growth. From an enterprise perspective, franchising has benefited from being taken seriously as an asset class rather than being viewed as a fragmented collection of small, independently owned businesses.
But the same spotlight that brings credibility also exposes fault lines that have always existed beneath the surface of the franchise model.
Private equity firms are driven by return on investment. That is not a criticism; it is their mandate. Most funds operate on a three- to five-year investment horizon with a disciplined focus on increasing EBITDA, improving margins, tightening unit economics, and positioning the brand for a successful exit. Franchise agreements, by contrast, typically span ten years, often with renewal options that extend the relationship even further. Franchisees commit capital, sign personal guarantees, take on long-term leases, and structure their lives around businesses they expect to operate for decades. These timelines do not naturally align, and the consequences of that misalignment are very real.
Once a private equity firm acquires a franchise brand, the clock begins ticking almost immediately. Strategic decisions are filtered through the lens of exit readiness. Growth targets, cost controls, staffing models, technology investments, fee structures, and system-wide initiatives are evaluated based on how they enhance valuation within a relatively short window. Financial discipline and accountability matter, but problems arise when near-term financial optimization begins to outweigh the long-term health of the franchise system and the people who operate it every day.
Franchisees are not short-term investors. They are operators, employers, and community members. They have invested their savings, taken on debt, and tied their livelihoods to a brand they expect to grow with over time. When decisions are driven primarily by what a future buyer wants to see rather than by what franchisees need to succeed over the next decade, strain shows up quickly. Support resources may be reduced. Growth may outpace training and operational infrastructure, and other core areas can be impacted as well. Individually, these changes may appear manageable. Collectively, they can quietly erode trust.
This dynamic plays out very differently depending on whether the brand is a mature, legacy franchise system or an emerging franchise concept, and the chasm between those two realities is significant.
Legacy brands often have decades of operating history, substantial unit counts, established training platforms, experienced field teams, and strong consumer awareness. While franchisees in these systems are not immune to the pressures created by private equity ownership, the brand’s scale and maturity can provide a buffer. There is institutional knowledge, proven economics, and operational depth that can absorb disruption and ownership transitions with less volatility.
Emerging franchise brands operate without those safety nets. These systems are still being built. Unit economics are evolving. Processes are being refined in real time. Early franchisees are often taking on disproportionate risk in exchange for belief in the concept and the leadership team. When private equity enters at this stage, the margin for error narrows dramatically. Aggressive growth mandates can push systems to scale before the foundation is solid. Cost controls can strip away critical support functions at precisely the moment franchisees need them most. Strategic decisions may prioritize optics over durability. For emerging brands, private equity ownership can either accelerate maturation responsibly or magnify weaknesses that ultimately destabilize the system.
This reality leads to a difficult but necessary question: who is the true steward of the brand under private equity ownership?
Is stewardship held by individuals who have built businesses, understand the realities of operating a location, and feel personal accountability for franchisee outcomes? Or does it rest with boards and investment committees whose expertise is rooted primarily in financial modeling and portfolio performance? Many of the latter have never met payroll, negotiated a lease, or managed frontline employees. When stewardship shifts from builders and operators to financial overseers, culture often becomes abstract, decision-making more distant, and franchisees begin to feel like data points rather than partners.
The issue becomes even more pronounced at exit. If a franchisee has several years remaining on their agreement when a private equity firm sells the brand, they are suddenly partnered with someone new and often without a voice in that transition. The strategy they originally bought into may change overnight. The new owner may have entirely different priorities, growth expectations, or operational philosophies. Yet the franchisee remains bound by the same agreement, often living with decisions made years earlier by owners who have long since moved on.
This is where long-term risk quietly accumulates. Cost-cutting that weakens franchise support, aggressive development that overwhelms training and operations, fee increases without value creation, or a shift from partnership to extraction can damage trust in ways that are difficult to reverse. Franchising only works when trust exists. Once that trust erodes, even strong financial performance cannot fully compensate for the loss.
There is also a human and historical dimension that deserves acknowledgment. Many industry veterans remember a time when founders and franchisees built brands together in a more direct and personal way. Leaders such as Bud Hadfield, Fred DeLuca, and Anthony Martino were not distant figures hidden behind layers of management and investor relations teams. They were builders and stewards who thought in decades, not exit multiples. Franchisees felt seen, heard, and supported, and the success of the brand and the success of the franchisee were inseparable.
That era was not perfect, and mistakes were certainly made. But alignment was clearer. Long-term health mattered. Today, with some franchise brands changing ownership multiple times within a single franchise term, that sense of shared destiny can feel diluted, particularly for emerging systems still searching for their identity.
This is not an argument against private equity. It is a call for balance, responsibility, and awareness. Private equity can be a positive force in franchising when it respects the long-term nature of franchise relationships, honors the commitments embedded in franchise agreements, and treats franchisees as true partners rather than line items on a spreadsheet. When capital and stewardship work together, franchising can thrive.
But when short-term exit strategies collide with long-term franchise agreements, both the math and the trust begin to unravel. Franchising was never meant to be a flip. It was meant to be a relationship. And the further the industry moves away from that principle, especially across the wide gap between emerging and legacy brands, the more fragile the model becomes, regardless of how strong the numbers may look on paper.
If you are a franchisor, franchisee, investor, advisor, or industry professional who has lived through private equity ownership, explored possibilities, or deliberately chosen to avoid it, I invite you to share your perspective. What have you seen work well? Where have you seen tension or breakdowns occur? How do you believe private equity can better align with the long-term nature of franchising? This conversation matters, and the future of the franchise model will be shaped not just by capital, but by the collective insight and experience of those who are part of it every day.
About the Author
Paul Segreto brings over forty years of real-world experience in franchising, restaurants, and small business growth. Recognized as one of the Top 100 Global Franchise and Small Business Influencers, Paul is the driving voice behind Acceler8Success Café, a daily content platform that inspires and informs thousands of entrepreneurs nationwide. A passionate advocate for ethical leadership and sustainable growth, Paul has dedicated his career to helping founders, franchise executives, and entrepreneurial families achieve clarity, balance, and lasting success through purpose-driven action.
About Acceler8Success America
Acceler8Success America is a comprehensive business advisory and coaching platform dedicated to helping entrepreneurs, small business owners, and franchise professionals achieve The American Dream Accelerated.
Through a combination of strategic consulting, results-focused coaching, and empowering content, Acceler8Success America provides the tools, insights, and guidance needed to start, grow, and scale successfully in today’s fast-paced world.
With deep expertise in entrepreneurship, franchising, restaurants, and small business development, Acceler8Success America bridges experience and innovation, supporting current and aspiring entrepreneurs as they build sustainable businesses and lasting legacies across America.
Franchising, at its core, is a shared economic relationship. Yet far too often, franchisors approach business planning as if the franchisor and franchisee exist in separate financial universes. The franchisor prepares a corporate business plan focused on growth, infrastructure, and enterprise value, while franchisee economics are relegated to disclosure documents, spreadsheets, or conversations that occur later in the development process. This fragmented approach creates blind spots that can undermine even the strongest brands. A truly comprehensive franchise business plan must integrate both the franchisor’s business model and the franchisee’s operating reality into a single, cohesive framework.
The most effective way to understand this integration is to recognize that the franchisor’s financial performance and the franchisee’s financial performance are not parallel stories. They are chapters in the same book. The franchisor’s audited financial statements demonstrate fiscal responsibility, operational discipline, and sustainability at the corporate level. The Item 19 Financial Performance Representation, when properly constructed, reflects the real-world economics of the franchisee experience. When these two are developed independently, inconsistencies emerge. When they are developed together, they reinforce one another and tell a unified story about how the brand actually works.
An integrated business plan forces franchisors to confront the fundamental question at the heart of franchising: how does every participant in the system win over time. It requires modeling not just how the franchisor generates revenue, but how franchisees generate sufficient profitability to justify their investment, reinvest in their businesses, and remain committed brand ambassadors. It requires understanding how royalties, marketing fund contributions, supply chain requirements, technology fees, and other system costs affect unit-level performance, especially during the critical early years of operation when cash flow is most fragile.
Too many franchise systems are built on optimistic assumptions that hold up on paper but fail under operational pressure. A comprehensive plan replaces assumptions with discipline. It evaluates startup costs realistically, not aspirationally. It accounts for working capital needs, labor volatility, seasonality, local marketing effectiveness, and the time it takes for a unit to reach operational maturity. At the same time, it examines whether the franchisor’s revenue model can truly support the level of training, field support, marketing leadership, compliance oversight, and innovation the brand promises. When these elements are modeled together, weaknesses surface early, when they can still be corrected.
This level of integration has a direct impact on strategic decision-making. Growth initiatives are no longer driven solely by top-line franchisor revenue or unit count milestones. They are tested against their impact on franchisee unit economics and system-wide sustainability. Decisions about new technology platforms, menu expansions, required vendors, or marketing programs are evaluated through a broader lens that considers both cost and value creation across the system. This discipline protects franchisee profitability while strengthening the franchisor’s long-term credibility.
An integrated business plan also changes the dynamic of franchise development. Sophisticated franchise candidates increasingly expect transparency and alignment. They want to understand how the franchisor makes money, how franchisees make money, and whether those incentives are aligned or in conflict. When a franchisor can demonstrate that its corporate financial success is directly tied to franchisee performance, it elevates the conversation from sales to partnership. This attracts stronger operators, reduces churn, and leads to healthier multi-unit growth driven by existing franchisees rather than constant replacement of underperforming locations.
From a leadership perspective, this approach creates internal clarity. Management teams gain a more accurate understanding of how fast the system can grow without compromising support quality. They can better anticipate staffing needs, capital requirements, and operational bottlenecks. The business plan becomes a living tool rather than a static document, guiding decisions across development, operations, marketing, and finance. This is especially critical as brands evolve from founder-led organizations into more complex enterprises with multiple layers of leadership and external stakeholders.
Equally important is the cultural impact of integrated planning. When franchisors demonstrate that franchisee economics are not an afterthought but a core pillar of the brand’s strategy, it sets expectations throughout the organization. Field teams, support staff, and executives operate with a shared understanding that franchisee success is not just desirable but essential. This mindset influences everything from how policies are written to how conflicts are resolved and how innovation is introduced. It fosters trust, and trust is one of the most powerful accelerators of system-wide performance.
A comprehensive business plan that integrates franchisor and franchisee realities also strengthens the brand’s position with lenders, investors, and professional advisors. It signals maturity and reduces perceived risk. It shows that leadership understands the full economic ecosystem of the brand and is actively managing it. For emerging franchisors, this can be the difference between controlled, sustainable growth and expansion that outpaces the system’s ability to support itself.
Ultimately, franchising is not about selling the right to use a name or system. It is about building a repeatable, scalable model that works in the real world, across diverse markets, and over long periods of time. A franchisor who invests in a fully integrated business plan is not simply preparing for growth. They are designing a brand that respects the capital, effort, and trust franchisees bring to the table. They are aligning incentives, reducing friction, and creating a foundation for shared success.
In a marketplace where franchise candidates are more informed and competition for quality operators is intense, this level of planning is no longer optional. It is a defining characteristic of serious franchise brands. A franchisor’s business plan should not just explain how the company grows. It should demonstrate how the entire system thrives. When the franchisor’s audited financial strength and the franchisee’s operating performance are viewed as parts of a single strategy, the result is not just better planning. It is a stronger, more resilient franchise brand built to last.
About the Author
Paul Segreto brings over forty years of real-world experience in franchising, restaurants, and small business growth. Recognized as one of the Top 100 Global Franchise and Small Business Influencers, Paul is the driving voice behind Acceler8Success Café, a daily content platform that inspires and informs thousands of entrepreneurs nationwide. A passionate advocate for ethical leadership and sustainable growth, Paul has dedicated his career to helping founders, franchise executives, and entrepreneurial families achieve clarity, balance, and lasting success through purpose-driven action.
About Acceler8Success America
Acceler8Success America is a comprehensive business advisory and coaching platform dedicated to helping entrepreneurs, small business owners, and franchise professionals achieve The American Dream Accelerated.
Through a combination of strategic consulting, results-focused coaching, and empowering content, Acceler8Success America provides the tools, insights, and guidance needed to start, grow, and scale successfully in today’s fast-paced world.
With deep expertise in entrepreneurship, franchising, restaurants, and small business development, Acceler8Success America bridges experience and innovation, supporting current and aspiring entrepreneurs as they build sustainable businesses and lasting legacies across America.
The arrival of a new year has a way of demanding attention. Calendars reset. Forecasts are refreshed. Decks are rebuilt. Yet for franchisors, the turning of the year should be less about routine planning and more about an awakening. A moment of deliberate pause. A recognition that planning is not an administrative exercise, but a responsibility that shapes livelihoods, investments, and trust across an entire system.
Too often, planning begins with ambition before it begins with truth. Growth targets are set before lessons are absorbed. Initiatives are launched before friction is understood. A more grounded approach starts by asking harder questions. What did we believe a year ago that turned out not to be true? Where did we underestimate the strain on franchisees? Where did we mistake activity for progress? This kind of reflection can feel uncomfortable, but without it, planning becomes performance rather than preparation.
An awakened planning process forces leadership to slow down long enough to listen. Not just to reports and dashboards, but to the lived experience of those inside the system. Operations teams feel the pressure points first. Support teams hear the frustration before it shows up in metrics. Development sees the hesitations of prospects long before deals stall. Finance understands the limits of what can be sustained. When these voices are invited into the planning room, the plan gains depth, not complexity.
Franchisees must be more than an audience for the plan; they must be part of its formation. They are not theoretical operators. They are the ones hiring in tight labor markets, managing rising costs, responding to customer expectations that shift faster than brand standards can be rewritten. Their perspective grounds planning in reality. Inclusion here is not symbolic. It is strategic. A plan shaped with franchisee input is more likely to be executed with discipline, because it reflects conditions as they truly exist, not as leadership wishes them to be.
Awakened planning also expands the definition of stakeholder. Suppliers are not line items. Vendors are not interchangeable. Professional service providers are not merely outsourced functions. These partners operate at the edges of the system, often seeing disruption before it reaches the core. Ignoring their insights narrows vision. Inviting them into the conversation strengthens resilience. When partners understand where the brand is headed, they are better positioned to support, innovate, and adapt alongside it.
Then there is the customer, the most powerful stakeholder and the one most often spoken for rather than listened to. Customers rarely articulate strategy, but their behavior speaks volumes. What they buy, what they ignore, what they complain about, and what they praise all reveal the truth of the brand promise. Planning that fails to confront this reality risks internal alignment while drifting further from the market. An awakened franchisor treats customer insight not as a marketing input, but as a strategic compass.
Benchmarks, when viewed through this lens, become more than numbers. They become signals. Same-store sales, profitability, retention, operational consistency, and brand engagement all tell a story about the health of the system. Setting these benchmarks requires restraint and courage. Inflated targets may inspire briefly, but they corrode credibility over time. Realistic benchmarks, transparently chosen, create momentum because they are believed.
It is also worth acknowledging a quiet truth many leaders carry into the new year. Planning does not always happen on schedule. January arrives, the pace accelerates, and suddenly it feels as though the moment has passed. It has not. It is never too late to plan. In fact, planning in January, even when you feel behind, is often more honest than planning months earlier. Real conditions are visible. Early data is already emerging. The urgency sharpens focus. A delayed plan is far more powerful than no plan at all, and a reset done with clarity can still shape the remaining eleven months in meaningful ways.
Yet even the most thoughtful plan is only a starting point. The year ahead will not unfold as predicted. It never does. Monitoring the plan requires humility and discipline. Regular, structured reviews force leadership to confront what is working and what is not. Quarterly conversations are not about defending decisions made months earlier; they are about recalibrating with clarity. The strongest organizations do not cling to tactics out of pride. They adjust early, decisively, and with intention.
Change, however, must be anchored. Goals represent commitment. Tactics represent movement. When conditions shift, movement may change, but commitment should not. This distinction matters. Franchisees lose confidence when goals feel disposable. They gain confidence when leadership explains how and why the path is evolving while the destination remains steady.
Communication becomes the connective tissue of the entire process. Silence breeds speculation. Overly polished updates breed skepticism. What builds trust is consistent, honest communication about progress, setbacks, and decisions. When franchisors communicate openly, they invite the system into shared accountability. The plan stops belonging to corporate and starts belonging to the brand.
Planning for a new year, at its highest level, is an act of stewardship. It acknowledges that franchising is not just a growth model, but a relationship model. Every decision echoes across operators, partners, employees, and customers. An awakened approach to planning respects that weight. It resists shortcuts. It values inclusion over illusion. It recognizes that certainty is rare, but clarity is attainable.
The challenge now is not to admire the idea of planning, but to confront it. Not to ask whether a plan exists, but whether it is alive. Is your plan grounded in truth or propped up by optimism? Have you invited the voices that will be most affected by it, or only those who will approve it? Do your franchisees understand the plan well enough to defend it, execute it, and believe in it? Are you reviewing it with discipline, or only revisiting it when results disappoint?
If you find yourself already in January and behind, the challenge is sharper still. Pause anyway. Gather the right people. Ask the uncomfortable questions. Build the plan you wish you had started earlier. Then commit to managing it relentlessly for the rest of the year. The cost of delayed planning is real, but the cost of avoiding it is far greater.
The call to action is simple, but not easy. Treat planning as leadership, not logistics. Make it inclusive, measurable, and visible. Revisit it often. Communicate it clearly. Adjust without abandoning it. Because in franchising, the future is rarely decided by the strength of the idea, but by the discipline of the plan and the courage to lead it forward, together.
About the Author
Paul Segreto brings over forty years of real-world experience in franchising, restaurants, and small business growth. Recognized as one of the Top 100 Global Franchise and Small Business Influencers, Paul is the driving voice behind Acceler8Success Café, a daily content platform that inspires and informs thousands of entrepreneurs nationwide. A passionate advocate for ethical leadership and sustainable growth, Paul has dedicated his career to helping founders, franchise executives, and entrepreneurial families achieve clarity, balance, and lasting success through purpose-driven action.
About Acceler8Success America
Acceler8Success America is a comprehensive business advisory and coaching platform dedicated to helping entrepreneurs, small business owners, and franchise professionals achieve The American Dream Accelerated.
Through a combination of strategic consulting, results-focused coaching, and empowering content, Acceler8Success America provides the tools, insights, and guidance needed to start, grow, and scale successfully in today’s fast-paced world.
With deep expertise in entrepreneurship, franchising, restaurants, and small business development, Acceler8Success America bridges experience and innovation, supporting current and aspiring entrepreneurs as they build sustainable businesses and lasting legacies across America.
Franchising has long been celebrated as one of the most proven pathways to entrepreneurship. For decades, the franchise model balanced opportunity, scalability, and shared success. But today, a growing number of franchisees, franchisors, suppliers, lenders, and industry observers are asking a difficult question: Does modern franchising still work the way it was intended to work? Or has the financial and operational reality of the franchise relationship shifted so dramatically that the model itself needs updating, transforming, or even rethinking entirely?
Margins in many segments are tighter than ever. Buildout costs have climbed from the $250,000–$350,000 range of a decade ago to $500,000–$750,000 or more. Labor costs have risen significantly. Commodities fluctuate at levels that were once considered outliers but now feel permanent. Royalties and required spend commitments often remain fixed regardless of market pressures. And the time to reach ROI, once measured in two to four years for many concepts, now too often stretches into five, six, or even eight years, if it arrives at all. When an owner invests half a million dollars only to generate income that resembles job-level wages, many cannot help but ask whether they purchased a business or simply bought themselves a job. And when the day comes to exit and the resale value barely exceeds depreciated assets plus $25,000 to $30,000, the question becomes even more uncomfortable.
This is not an indictment of franchising. It is a call to confront reality. The franchise model remains powerful when the unit economics support real wealth creation. But when they do not, the system becomes strained. Trust erodes. Misalignment grows. And the relationship that should be mutually beneficial becomes adversarial, defensive, and transactional. The franchise community, franchisors, franchisees, advisors, and suppliers, must decide whether to accept the status quo or rethink the structure in ways that create healthier, more resilient outcomes for everyone involved.
What should be considered? Perhaps the future of franchising requires more than incremental adjustments. Perhaps it requires a reimagining of how risk and reward are shared. Maybe royalties evolve from fixed percentages to performance-based, margin-aware models. Maybe franchisors participate more meaningfully in local profitability rather than simply top-line revenue. Maybe franchisees are offered hybrid structures that lower upfront capital burdens in exchange for shared equity, giving both sides deeper alignment and a shared stake in long-term brand value. Maybe multi-unit pathways become more accessible not through aggressive financing, but through structured internal growth programs that reward operators who consistently perform. Maybe supplier and franchisor rebates, often a sore point for franchisees, are restructured so value flows more transparently and equitably throughout the system. And maybe franchise development itself becomes less about awarding units and more about cultivating entrepreneurs who are prepared for the realities of running high-cost, thin-margin businesses in a competitive and unforgiving market.
There is also space for entirely non-traditional concepts that blend franchising, licensing, partnership, and revenue-sharing arrangements. Models that reduce upfront capital requirements through modular builds, micro-footprints, shared kitchens, or neighborhood partnerships. Models that use technology to reduce labor dependency. Models that allow experienced operators to earn their way into ownership rather than buy their way into it. Models that align franchisor success not simply with brand expansion but with the financial stability of its franchisees.
These ideas are not meant as prescriptive answers. They are starting points. And perhaps the most important question the franchise community must ask is not “What needs to be fixed?” but “What are we willing to change?” Because the market is already changing, consumer behavior is already changing, and the economics of operating a small business—franchised or otherwise—are already changing. The question is whether franchising will evolve proactively or react when forced.
Franchising remains one of the most powerful economic engines in America and around the world. But engines require maintenance. Systems require updates. Relationships require honesty. And business models, even successful ones, eventually require reinvention. The future of franchising will belong to the brands, advisors, franchisees, and leaders who are willing to rethink not just the operational pieces, but the philosophical ones: fairness, alignment, opportunity, accessibility, sustainability, and shared success.
If the franchise community wants a stronger tomorrow, now is the moment for candid conversation. What do you believe needs to change? How do you see the future of franchise relationships? What innovations, structures, or bold ideas would you like to see tested? Whether you are a franchisor, franchisee, supplier, lender, consultant, or industry observer, your perspective matters. Add your voice, your experience, and your vision. This is a dialogue the industry needs—and one only the community itself can lead.
About the Author
Paul Segreto brings over forty years of real-world experience in franchising, restaurants, and small business growth. Recognized as one of the Top 100 Global Franchise and Small Business Influencers, Paul is the driving voice behind Acceler8Success Café, a daily content platform that inspires and informs thousands of entrepreneurs nationwide. A passionate advocate for ethical leadership and sustainable growth, Paul has dedicated his career to helping founders, franchise executives, and entrepreneurial families achieve clarity, balance, and lasting success through purpose-driven action.
About Acceler8Success America
Acceler8Success America is a comprehensive business advisory and coaching platform dedicated to helping entrepreneurs, small business owners, and franchise professionals achieve The American Dream Accelerated.
Through a combination of strategic consulting, results-focused coaching, and empowering content, Acceler8Success America provides the tools, insights, and guidance needed to start, grow, and scale successfully in today’s fast-paced world.
With deep expertise in entrepreneurship, franchising, restaurants, and small business development, Acceler8Success America bridges experience and innovation, supporting current and aspiring entrepreneurs as they build sustainable businesses and lasting legacies across America.
From professional athletes to high-tech programmers, every career requires different talents. However, what makes a career as a leader of a franchise system different are skills that do not have to be acquired through rigorous training or years of schooling.
Instead, success in franchise leadership can come to anyone who is determined, dedicated and willing to invest in their personal development—and will pay off tremendously by developing a network of franchisees who respect your leadership traits. Below are key focus areas for individuals to become successful brand executives and great well-respected leaders:
Consistency: As the franchisor, your franchisees will be looking up to you. Being consistent and following through on your word will let them know that they have a leader they can count on.
Planning: Your franchisees are invested in the business, so it’s natural that they will want to know where it is headed and the steps necessary to get there.
Communications: Make certain to share your vision with franchisees as well as with your team in an open, transparent manner to ensure confidence at all levels.
Support: As a franchisor, everyone in the organization is your team member—meaning you have a vital role as a pillar of support and encouragement.
Positivity: Focus on creating a positive space for your franchisees. This will help strengthen your bond and let them know you have their back.
Respect: Every franchisee makes mistakes—it’s just a part of the business. Making sure your franchisees know you still respect them even when they slip up will go a long way. The same will be true for franchisor mistakes, but only if earned through mutual respect.
Face Time: You can’t be expected to visit every franchise location every day. However, the occasional impromptu visit will help you learn more about the day-to-day operations and struggles of each individual location—and let them know you’re invested in solving their problems.
Passion: Franchising means getting to work with talented, passionate colleagues who love what they do. Believe in the brand and believe in your franchisees—your passion will shine through and inspire them, as well.
To celebrate Franchisees, I cite the lyrics to the Alabama hit song, “Forty Hour Week”. It’s my way of expressing gratitude for the many, many franchisees and their employees that do their parts every day to make, not only their franchise brands run each and every day, but also our great country. We often take so much for granted when things run smoothly, almost seamlessly. Of course, during COVID there were challenges, but many franchisees did what they had to do, and persevered.
And then, it hit me as I reread the last verse of the song…
There are people in this country who work hard every day. Not for fame or fortune do they strive. But the fruits of their labor are worth more than their pay. And it’s time a few of them were recognized.
Wow, how could I miss something that should be standing out front and center? Is it obvious? Do you see it yet?
Okay, let me make it easier to spot. In the verse above, change “people” to “franchisees” – Ah, there it is! There are franchisees in this country…
At times, there is some discourse (maybe more than we’ll admit) today around the franchise relationship and it really doesn’t need to be the case if the focus is clearly on relationship basics, and that starts with appreciation. Remember, many franchise organizations refer to their system as a family. Isn’t being family enough to expect appreciation?
Think about when a franchisee signs their franchise agreement and remits the franchise fee – they’re quickly told, “thank you” and they’re even recognized in the brand’s newsletter and also in press releases announcing them as a new franchisee. Yes, that’s awesome.
Now, ask yourself, is that the last time franchisees are actually thanked or recognized? Most likely that is often the case. But I’m not just referring to systemwide accolades. I’m talking about someone from the brand’s leadership team picking up the phone for a quick call or planning to visit when in the franchisee’s area. Or at the very least sending a hand-written note just to say, “thank you” and that they’re appreciated for their investment in the brand, for how they represent the brand, and for how they’re committed to protecting the brand.
So, why not jumpstart an improvement in your franchise brand’s culture by starting with “thank you” as the norm, rather than as the exception?
There are franchisees in this country who work hard every day. Not for fame or fortune do they strive. But the fruits of their labor are worth more than their pay. And it’s time a few of them were recognized.
Recently, in a discussion about organizational culture, the exchange was quite robust and included the following statement from a CEO participant who stated, “The challenge becomes determining where and when things might be out of alignment. So, developing the methodology about how to realign must be developed and committed to early on.”
To the CEO’s point, the development and management of organizational culture is much like that of developing and cultivating a brand…
It must be planned.
It must be nurtured.
It must be allowed to grow.
It must be invested in.
It must be protected.
It must be promoted.
It must be cherished.
It must be the center of the universe.
I believe it’s relatively easy to determine when and where things are out of alignment in a franchise organization – disgruntled franchisees, refusal of franchisees to develop additional locations and instead are investing in other brands, frequent franchisor employee turnover… just to name a few that would be very apparent. Obviously, these are the results of, but not the root of the problem that may have caused things to move out of alignment. Mostly the problems occur (and fester) due to poor communications and lack of transparency between franchisor and franchisees. Inconsistent messaging adds fuel to the fire. Basically, similar problems to a marriage or other types of relationships that fail.
As for methodology to realign, that takes full commitment and focus from all parties to the relationship. However, in a franchise relationship it takes the franchisor to take the bull by the horns and lead the charge. The franchisor must spearhead the initiative to create open, honest, transparent communications, and especially through difficult scenarios. Franchisees have made a significant investment in the brand, and they must be kept aware of the good, bad AND ugly. Two precarious points include: How much is too much? Do franchisees need to know everything? Getting back to square one, a benchmark of sorts is critical as emotions running high will dictate more rather than less. Actions must speak louder than words!
At workshops and seminars, as well as within coaching and consulting projects, I talk a great deal about creating and delivering positively memorable experiences at all times. I believe it applies to the franchise relationship as much as it applies to customers & clients. I won’t get too deep here as this past week I shared my thoughts on the topic in this newsletter and in the past in the IFA’s Franchising World magazine. Instead, I will share my thoughts on a guideline that will help monitor the experience factor in any transaction or relationship. This guideline is what I refer to as, “The Emotion Circle”.
There are seven key steps within the circle. Think in terms of a clock with the top being the starting point. This is where the relationship begins. Once something occurs that doesn’t meet expectations the first reaction is surprise. From there, emotions may escalate to the next steps of disappointment and doubt. Or it may not escalate but another “incident” will definitely move the needle along. Sometimes, even an unaddressed issue will move it.
Of course, it is inevitable things happen, and expectations aren’t met or even understood. This is why proactive, open, transparent communications are paramount. If the issues are discussed openly and frankly in a respectful way, the needle can be moved back to the 12 o’clock position with minimal or no chance of fueling a fire. We must keep the emotions within the blue section of the circle. This is key!
However, if issues are not addressed in a timely and respectful manner the fire burns rapidly and on occasion to the point where it flares up and / or quickly burns out of control. And, just like wildfires in the forest, these fires can and will jump across roads from house to house and community to community with devastating results.
If not brought under control in a swift manner, the next emotions are often expressed in rapid order through the pink sections and into the red circle. These include frustration, anger, hostility and yes, remorse (think “buyer’s remorse). Ultimately, the end result is broken trust and as we know, trust is the backbone of ANY relationship. Moving back from the pink section is extremely difficult, but not impossible. However, once emotions escalate into the red section, the possibility of salvaging the relationship is almost impossible. Trust will need to be earned back without any assumption on the part of the offending party that it will.
In order for realignment to occur throughout the emotion circle, issues must be addressed expeditiously. It’s paramount that trust be rebuilt before further escalation of emotions. It’s certainly not easy – but it can and must be done. However, it does take huge, ongoing commitment to be established, to remain in place, and to be built upon.
An important question to ask yourself or of an organization’s leadership – Are we truly committed to our relationships? If the answer is not a resounding yes, rest assured trouble is on the horizon. As such, it’s essential to find out the reason(s) and immediately take action to correct. The foundation of developing and curating the right culture depends on it.
The dream of owning your own business is alive and well for most Americans. The only problem is that many people don’t know where to start on the journey to becoming self-sufficient. There are a million different options, but first and foremost each potential entrepreneur must decide if he or she wants to become a franchisee or start a business independently.
Each route has its benefits; therefore, it’s critical to take the time to consider both options before making a decision. What it initially comes down to is asking yourself the following questions:
1. Do you understand every aspect of the business or do you thrive in one area?
When starting a business from scratch, entrepreneurs should be well versed in every single element of the enterprise. They need to create systems and procedures and test whether these work for that particular business. This process of ironing out the details deters some from choosing to own an independent business but excites and challenges others.
Conversely someone who buys a franchise knows that someone else has already done the “dirty work” and found the most effective systems for that particular business. A franchisee must simply thrive at correctly running the system while adding their own personal management touch.
2. Are you an expert at making a name for yourself or would you like to be associated with an already strong brand?
When purchasing a franchise, you are also inheriting the reputation of that brand. For example, if you open your own Dunkin’ Donuts shop, you will encounter customers who already recognize the pink and orange logo. Many people will know whether they like the brand and will expect speedy service providing them doughnuts and steaming hot coffee.
On the other hand, those starting a business from scratch have a chance to create a unique brand identity. But consumer trust and awareness don’t come easily; they need to be earned through time, consistency and excellence.
3. Are you the kind of person who likes to go it alone or do you appreciate a sense of community?
Owning a business — whether it’s a franchise or not — can be risky. Some people prefer to be self-reliant and want to manage potential problems using past experiences and premonitions as guides. An entrepreneur must solve the issues that arise.
Others prefer enlisting the support and help of others to ensure that their business runs smoothly. A franchisee has many built-in allies, including the franchisor and other franchisees within the system.
The most important factor for success is making sure that problems are identified, and steps are taken in the right direction.
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