You did all the research into your franchise opportunity and followed the plan with painstaking detail. You are putting in tons of hours and your social media presence is lively.
But are you successful? Identifying the key performance indicators of success can tell you whether your strategy is working (and where it needs improvement). Here are the basics you should measure.
Revenue, profit and year-over-year sales
Sales and profits are not the same, so these are performance indicators you need to evaluate separately. Your gross sales are a critical metric since they represent how much revenue you are generating – while your profits take your revenue and costs into account.
You should also examine year-over-year sales. This means comparing the revenue and costs to the same period last year. For example, did the store do as well from April through June of this year as it did from April through June of last year?
Conversion rate and return on investment
Your conversion rate indicates how well your marketing efforts are paying off in terms of moving prospective customers down the pipeline into actual customers.
The marketing return on your investment (ROI), by comparison, lets you determine if you are spending more on your marketing than you are making from your customers. If it costs more to get a prospect to convert than the customer is worth, then you need to rethink your strategy.
Do you have questions?
Franchisees have many issues to evaluate and consider, and they often need support when they encounter a legal problem. If your franchise is facing a legal issue and the franchisor is not being supportive, it may be time to reach out for help.
NOTICE: This blog is intended solely for informational purposes and should not be construed as providing legal advice. Please feel free to contact us with any questions you may have regarding this blog post.