How Multi-Unit Franchisees Can Turn Around Underperforming Locations

Owning multiple franchise locations can be incredibly rewarding. However, even the strongest portfolios can include units that fall slightly short. Early recognition of the warning signs can help multi-unit franchise owners act decisively, increasing the chances of turning a struggling franchise location around.

At the end of the day, underperformance isn’t a reason to panic. It’s an opportunity to assess, correct, and strengthen the foundations that can help deliver long-term success in franchising.

Early warning signs that shouldn’t be ignored

The first step is paying close attention to key performance indicators. KPIs are there for a reason. They let franchise owners see, at a glance, how each location stacks up against system averages and top performers. That context matters. When the numbers start slipping, and you let it ride, small issues can quickly turn into bigger ones.

While it can be tempting to assume underperformance stems from external factors like market shifts, seasonal changes, or new competition, the reality is that the most common challenges tend to be found within the business itself. Pricing should reflect profitability, and staffing efforts should be properly aligned. Inconsistent delivery of services and scheduling inefficiencies are also red flags that require an honest, proactive evaluation. Avoiding tough decisions may feel like the simpler fix in the short term. But in the bigger picture, it tends to just make problems worse.

Digging deep: Finding the root cause

Proper analysis of KPIs is merely a starting point. Numbers can point multi-unit franchise owners in the right direction, but they only scratch the surface. They don’t necessarily reveal the full story. A unit may display strong cost-of-goods metrics but still experience declining customer retention. Underperformance is rarely caused by just one factor. Leadership, operations, staffing, and local market conditions are all interwoven. Effective turnarounds address the entire system as opposed to only isolated symptoms.

Stabilize before you optimize

Only when root causes are identified can stabilization be prioritized, making it important to address immediate concerns like pricing, labor alignment, and service execution (which can help stop the bleeding). Next, the standardization of general processes can help deliver results that are a bit more predictable in nature. This is when strong local leadership becomes critical.

Multi-unit franchise owners should be able to place their confidence in the manager leading the turnaround, one that is backed by clear short-term goals and measurable KPIs. From there, regular check-ins can help reinforce accountability while maintaining momentum.

Lead without undermining your team

Course correction is a nuanced process. Multi-unit franchisees should balance the idea of stepping in while still attempting to empower managers. It’s a delicate balance, but trust can be built by rolling up one’s sleeves, concentrating on collaboration (especially when it comes to goals), and maintaining honest, transparent communication.

Operational adjustments that often deliver quick results tend to focus on customer acquisition, retention, and profitability. While retraining existing workers takes time, it can also increase new customer engagement, which can deliver more immediate wins. Attention to culture and engagement is also essential. Burnout or low morale can slow progress. Leaders must be visible mentors and advocates, working alongside their teams to personally display and model commitment and drive.

Using technology to gain clarity

Technology can accelerate turnaround efforts, helping deliver workplace efficiency while providing the consistency that franchising has long been known for. CRM tools, analytics platforms, and AI-driven insights can help multi-unit franchise owners identify trends and reveal inefficiencies, guiding the decision-making process. It’s by no means a replacement for hands-on leadership. But when properly utilized, tech can provide clarity and help franchisees pointedly target preventive actions where they’ll actually have a measurable impact. For example, analyzing customer feedback can reveal service gaps, while drilling down on staffing data can showcase operational bottlenecks.

The long game: Patience, persistence, and progress

Turning around an underperforming unit takes time. It requires honest, proactive assessment, decisive action, strong leadership, and persistent follow-through. By focusing on what’s within their control, multi-unit franchise owners can stabilize struggling units, empower their teams, and place each location back on a path to sustainable success.

Ultimately, it is important to remember that a struggling unit isn’t necessarily a failure. It should be viewed as an opportunity to refine operations and reinforce culture to achieve stronger, more consistent results.

Leanne Stapf is an executive vice president at Authority Brands, leading three dynamic brands: The Cleaning Authority, The Junkluggers, and Homewatch CareGivers.