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Counseling Franchises During the Recession

By Erik Wulff
March 26, 2009

This deep recession is hitting virtually every corner of the economy. Some companies are faring better than others (McDonald's and Wal-Mart, just to name a couple), but there are very few companies that are not adversely affected in a significant way, including franchising companies of every stripe and size. Depending on one's particular industry or segment of industry, the effect may vary considerably. However, every company has to take stock of its business model and decide how it can best weather adverse conditions.

It is axiomatic that franchisors and franchisees need to work together to overcome the impact of the declining economy. Their success is deeply intertwined, and they are mutually dependent. Now more than ever, franchisors need to demonstrate leadership by making every effort to assist their franchisees. This might include redoubling marketing efforts to increase (or at least to maintain) sales levels, finding every way to cut operating costs without compromising brand integrity, providing effective training, and so on.

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