Franchise Update Magazine Issue IV, 2015 | Page 42

Unwinding in the bar at
Maggiano’s before
the STAR Awards

She just won $500
in the Expo Hall!

Day Two
The second day of the conference kicked
off with breakfast and coffee outside the
meeting rooms before the first general
session began at 8:30. Therese Thilgen,
CEO of Franchise Update Media, welcomed everyone. She noted that this was
the largest Franchise Leadership & Development Conference ever, and highlighted its reputation for “transparency
and a place where professionals can share
with each other.”
Next up was Steve Dunn, senior vice
president of global development at Denny’s, who served as this year’s conference
chair. In his welcoming address, he recalled
attending the first Leadership & Development Conference 17 years ago, noting
how far it has come and how much it has
grown. He also praised the openness and
sharing aspect of franchising before introducing the day’s first speaker, FRANdata
CEO Darrell Johnson.
In his annual “State of Franchising”
economic address, Johnson delivered his
overview of the economy and its likely effects on franchising. He advised attendees
to view the coming years with
“cautious optimism,” and to
keep aware of risks and trends
that could affect their business.
Positive factors included rising consumer confidence, rising disposable income, credit
easing somewhat, and interest
rates at historic lows that are
unlikely to change appreciably
in the near future.
On the downside, he noted
that while the stock market has
had a positive run for the better part of seven years, part of
the reason is stock buybacks,
which lift share prices; busi-

40

ness confidence remains cautious; and that
while household debt is steady, there are
no significant reserves for increased consumer buying power in an economy where
consumer spending accounts for about
70 percent of activity. This works against
franchise brands raising their prices. Also,
he said, there’s a dichotomy between sales
and pressure for raising wages. “Sales are
down, wages are rising, which is usually
not a very stable situation.”
In a sluggish economy plagued by
Congressional gridlock, franchising will
likely remain a “battle for market share,”
he said. Noting historical GDP patterns
in presidential election cycles, he said
2017 should be a “pretty good year” with
2016 just “so-so.”
Although franchising is outperforming
the economy as a whole (in terms of GDP
and the stock market, for example), and
unit growth continues to be strong, he said
there are many potentially destabilizing
factors on the radar. These include regulatory changes driven by unions pushing
for higher wages, and governmental actions at the city, state, and federal levels.

Johnson cautioned franchisors to keep
an eye on a general societal perception
that franchisors have “gained too much
control” and warned that the government
could react with additional legislation and
regulations.
“The franchise business model has
been painted into a corner—wrongfully,”
he said, and franchisors and franchisees
alike need to become active to correct
misperceptions and change the narrative
about franchising, focusing on its role in
creating new businesses and jobs across
the country.
Keynote: Create distinction
Next up was keynote speaker Scott McKain,
author of three Amazon.com #1 business
best-sellers (ALL Business Is Show Business,
What Customers Really Want, and Collapse
of Distinctions) and founder and CEO
of the Distinction Institute. His newest book, 7 Tenets of Taxi Terry, is based
on a taxi driver McKain encountered in
his travels whose approach to customer
service impressed him so much that he
based a book on him.
McKain pushed attendees to examine their business practices and outlook
with provocative, practical
questions such as, “When you
sell a franchise, what are you
really selling?” He soon followed with another question:
“Are you selling what you say
you’re selling?”
Many of today’s selling
points have become commodities, he said, and to stand out
from the competition brands
must play up their unique and
distinctive attributes. “I’m
going to suggest to you that

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