General

A happy man on a computer and text reading "Post Jobs for Free on the Largest Marketplaces for Hourly Workers"

Post Jobs for Free on the Largest Marketplaces for Hourly Workers

Post Jobs for Free on the Largest Marketplaces for Hourly Workers 1016 528 Sprockets

Sprockets users can now enjoy free job posting on Snagajob, ZipRecruiter, Adzuna, Upward, and more! Avoid the fees that job sites typically charge while still attracting top talent for your team. You’ll spend less time and money on the hiring process, allowing you to focus more on the daily operations of your business.

Reach 6 Million Monthly Job Seekers

Simply create the job listings within your Sprockets dashboard and push it live to millions of job seekers on Snagajob, ZipRecruiter, Adzuna, Upward, and more with the click of a button. You don’t need to worry about creating separate accounts or paying any additional fees. It’s a quick, convenient way to advertise your employment opportunities to qualified applicants.

Improve Retention by 43%

The applicants will automatically appear in your Sprockets dashboard along with their respective fit scores, predicting who will perform like your best employees. You’ll instantly be able to identify who is worth interviewing and will contribute to the success of your business. Users report a 43% improvement in 90-day employee retention, on average!

Join the List of Satisfied Customers

We know Sprockets’ AI-powered software is the solution for your hiring needs, but you don’t need to take our word for it. There are numerous happy customers who love to share their thoughts on Sprockets. Here’s what one user had to say:

“Sprockets has allowed us to focus on the people who have the right characteristics, the right personality, [and] the right traits, and we don’t waste as much time on those that aren’t qualified anymore.”

– Ken Cope

Home Instead Franchise Owner

Start Posting Job for Free Through Sprockets

The Sprockets and Snagajob platformsDon’t wait any longer to improve your hiring process and reduce costly employee turnover. Our team is ready to set you up for success with the Sprockets platform, empowering you to reach millions of job seekers for free and build the best team for your business. Schedule a brief demo today to get started!

Someone packing up their desk with text reading "How to Identify the Warning Signs of Employee Turnover"

How to Identify the Warning Signs of Employee Turnover

How to Identify the Warning Signs of Employee Turnover 1016 528 Sprockets

Employee turnover remains one of the most significant issues that businesses experience, especially in the restaurant and home health care industries. Turnover drains a company’s budget and time and affects overall productivity, but it can be difficult to manage.

Although there might not be a perfect solution that completely eliminates turnover, you can begin to combat the issue by learning to recognize certain red flags. Identifying the warning signs of employee turnover is essential to avoid staffing issues and ensure your business runs smoothly. It can also help you notice problems in the workplace and fix them, ultimately improving overall retention.

4 Common Warning Signs of Employee Turnover

1. Changes in Work Routines

When employees begin to miss deadlines or submit sub-par work, it may be an indication that they have started to check out. Each of us has a bad day from time to time, so you should address this issue with sensitivity to gauge the cause effectively. However, you should note apathy about missed deadlines and errors.

2. Absenteeism and Tardiness

When employees who are always punctual and never miss work start reporting to work late, leaving early, or asking for several sick days unexpectedly, something might be wrong. They could be modifying their schedule to meet with prospective employers or undergoing significant personal issues that could affect their mood. Either way, you should talk to them to understand punctuality changes and try to work with them to improve their situation in the workplace.

3. Change in Attitude 

If a team member who rarely complains starts to say negative things about their work or seems disgruntled, it could be an early sign of turnover. Their poor attitude and comments could also begin to negatively impact the rest of the team, ultimately reducing productivity and company culture.

4. Low Engagement

When friendly and talkative employees suddenly stop engaging with other workers, it could be another red flag. Breaking routines and leaving acquaintances and friends is one of the hardest parts people experience when leaving a company. Therefore, when you notice that employees have begun to pull away and remain quiet, they might be preparing to leave.

Reduce Costly Employee Turnover With Sprockets

A woman showing a laptop screen of the Sprockets hiring platformAnother major step toward improving retention is to implement Sprockets’ AI-powered solution to your hiring process. Our sophisticated software creates a unique success profile based on the mental makeup analysis of your current top-performing employees and gives applicants a “fit score” based on this benchmark. You’ll instantly see which applicants are worth interviewing, will succeed, mesh well with the team, and contribute to your company’s success.

A tired woman and text reading "The Top Reasons Why Employees Leave a Company"

The Top Reasons Why Employees Leave a Company

The Top Reasons Why Employees Leave a Company 1016 528 Sprockets

One of the best steps toward reducing employee turnover is to understand precisely what causes it. Some businesses, especially franchises in the QSR and home health care industries, experience particularly high turnover rates. The factors can vary, but we created a quick list of common reasons why employees leave their companies to help you improve retention.

6 Reasons Why Employees Leave Companies

You might think that low income is one of the leading causes of employee turnover. However, research has revealed that only 12% of workers quit their jobs because of money. Here are some of the top reasons why employees leave their companies:

1. Lack of Flexible Work Arrangements

Today, most employees want more flexible schedules. They no longer search for a typical 9:00 to 5:00 job, which requires them to stay in the office daily. They often choose to work for an organization that allows them to work remotely at least once per week. Our increasingly digital work environment gives us many reasons why we should enable our employees to work remotely.

If a company starts to offer a more lenient schedule, applicants might choose it over competitors. About 37% of workers would leave their companies for another organization that allows them to work remotely. Correspondingly, 82% would become more loyal to their employers if given a more flexible work schedule.

2. Lack of Appreciation

An employer’s failure to appreciate their workers is one of the significant causes of employee turnover. Employees want their performance noticed, especially when they put in extra effort or work additional hours. However, many employees feel undervalued or underappreciated, and 66% say they would leave their job due to lack of appreciation.

This number is high in millennial workers, as eight out of ten say they would quit their jobs if their present organizations do not appreciate them. A simple “great job” or “thank you” can help employees understand that managers value their efforts and contribute to improved retention.

3. Lack of Progress

Employees understand progression in different ways. For example, some may feel that they want a promotion or salary increase to progress, while others may define progress as acquiring new skills. It does not matter what they would like to work on, who they work with, or how the organization compensates them. When managers fail to give employees room to grow, they get tempted to search for new opportunities and leave companies. Employers should create career and educational advancement opportunities for staff.

4. Poor Workplace Culture

Overall workplace culture also determines employees’ length of stay. Corporate culture begins at the top, and it is one of the essential elements that contribute to employee retention. Although companies have different cultures, always ensure it gives employees a sense of belonging.

Workers appreciate an environment with transparent communication, clear direction, and respectable and approachable managers. An unwelcoming organizational culture is one of the top reasons for employee turnover. 47% of individuals who actively look for new jobs do so due to bad corporate culture.

5. Excessive Workload

Although employers might want to reward high achievers with more tasks, they must be careful when doing so. When employees get overwhelmed with their job’s demands, they tend to leave for other organizations that provide more manageable workloads. Managers should ensure that their teams have manageable workloads. If you increase an employee’s list of responsibilities, pair it with a promotion, salary increase, or other noticeable benefits.

6. Changes in Personal Life

A change in personal life is one of the reasons employees leave a company, but it’s one that it’s difficult to avoid as a manager. For example, a worker may relocate to a new country for themselves or family members. Additionally, changes in their health can cause an employee to quit their job or look for a more accommodating position. While you do not have control over changes in employees’ personal lives, you can always support them in the workplace and through any major transitions.

Reduce Employee Turnover With Our AI-Powered Solution

A woman on a laptop hiring applicants with no industry experienceAlthough employees quit their jobs for various reasons, paying close attention to these factors can potentially help retain your best talent. And, when crew members inevitably leave, Sprockets makes it easy to find new workers that perform like your best employees.

Our sophisticated hiring solution combines artificial intelligence, natural language processing, and over 80 years of psychological research to predicts an applicant’s likelihood to succeed and stay long-term. Building the best team, and saving time and money, is as simple as adding our brief survey to your recruiting process. Sprockets even has an easy-to-use platform and integrates with other major hiring tools!

A woman with a headset and text reading "Maintaining Morale in the Workplace After Employees Leave"

Here’s How to Maintain Morale in the Workplace After Employees Leave

Here’s How to Maintain Morale in the Workplace After Employees Leave 1016 528 Sprockets

It’s inevitable for employees to leave workplaces, whether it’s for them to pursue another opportunity or their manager decided to let them go. However, when influential employees leave, the remaining team members may get frustrated about the situation or worry about their own position. These negative emotions might lead to low morale and reduced productivity. Leaders must then apply their skills to rejuvenate the workplace culture and positive atmosphere.

8 Ways to Boost Morale and Motivation in the Workplace

If you’re a manager, especially in the QSR or home health care industries, you likely deal with a high rate of employee turnover. Therefore, it’s crucial to know how to rebuild team morale after an employee — or several — employees leave, whether voluntarily or involuntarily.

Here are some strategies to maintain morale in the workplace after employees leave:

1. Re-Affirm the Team’s Vision and Goals

When employees leave their workplace, some rumbling in the workplace might occur as the remaining workforce might wonder about the future of the business. The remaining labor force needs reassurance that the company will still meet its long-term goals and be successful. Remind the team about the company’s vision and the significant roles they all play in that.

2. Be Open and Transparent

If you decide to let employees go, the remaining team members might wonder why you came to such a decision. In most situations, it is alright to provide an explanation and invite any questions or concerns your employees might have. This can put them at ease about their job security and workplace environment. 

(When informing the team about the reasons for termination, ensure that the engagement is a one-on-one meeting with open-ended questions. However, you might not be able to share all the contract’s termination details due to legal requirements in the state.)

3. Praise Employees for Their Contributions

The remaining team needs to be made feel appreciated for their contributions toward meeting the company’s short-term and long-term goals. As you commend their work, you need to put it appropriately for them to see the sincerity in the appreciation. Some people give their best in every team, and they need recognition through awards or recognition. Such credit will create a humane picture in the remaining employees’ minds, and they will remain focused on meeting the company’s goals.

4. Treat Laid-Off Employees With Respect and Dignity

If you have to terminate an employee for any reason, make sure you follow the due process and do so respectfully. If you handle a firing or layoff poorly, the ill-treatment will only create resentment within the remaining labor force. The remaining labor force will be less disgruntled if their former colleagues get treatment full of respect and dignity even as they leave.

5. Lighten Workers’ Mood

Buying free lunch or morning coffee for the remaining staff may improve the workplace’s mood. The company may also opt to take the workers for a trip or a social outing. During the event, the management should freely interact with the remaining employees. It might be a good opportunity to communicate why the decision was necessary and the next step the team will take to reach their goals together.

6. Emphasize Work-Life Balance

Management should create time for the employees to enjoy their social life with their families to increase their morale and prevent burnout. The administration can promote work-life balance by coming up with flexible schedules and remote working opportunities. Management should also avoid engaging workers while they are outside the workplace.

7. Organize Team-Building Activities

One of the most common ways to create a positive relationship between managers and their teams is to schedule team-building activities. Team-building creates collaborative cultures among teams, which is necessary after a significant layoff at work. If you are looking towards maintaining morale in the workplace after employees leave, a team-building initiative is one of the approaches to adopt.

8. Address the Workload Burden

Whenever workers leave, there is an unallocated workload that will have to be shared by the remaining staff if there is no immediate replacement. Adding extra work could cause resentment. If you are firing some employees, consider having them replaced as soon as possible. If the workload is to be re-distributed to the remaining workforce, consider informing them positively. You might want to consider even adding something to their paycheck.

Improve Retention and Team Morale With Sprockets

Two happy employees in a kitchenOne of the best ways to avoid the reduced morale associated with employee turnover is to hire the right applicants in the first place. Sprockets’ AI-powered solution predicts an applicant’s likelihood to succeed like your current top-performers, fit well with the existing team, and stay long-term. Users experience a 43% improvement in retention, on average!

Schedule a brief demo today to see how it works and start building the ideal team. You’ll save valuable time and money during the recruitment process and see an increase in overall productivity.

An unhappy man and text reading "How Employee Turnover Affects the Customer Experience"

How Employee Turnover Affects the Customer Experience

How Employee Turnover Affects the Customer Experience 1016 528 Sprockets

Business managers and human resource professionals must fully understand the effects of employee turnover. It disrupts scheduling practices, causes productivity slips, hurts company morale, wastes valuable time, and costs money.

However, one of the most significant consequences is the negative impact employee turnover has on customer service. The loss of long-term, top-performing employees means the loss of leadership, institutional knowledge, and rapport with customers. Experienced and seasoned employees, who understand the needs of customers, are in a better position to serve them.

The Effects of Employee Turnover on Customers

They Feel Less Valued

Businesses of all sizes should understand how employee turnover affects the customer experience. Whether it’s greeting them by name or knowing their favorite order, customers feel valued when employees understand them and their preferences. However, they can easily feel undervalued or unappreciated if there are always new employees at your location who lack the information or time to go above and beyond like this.

They Get Impatient

Employee turnover can lead to a loss of efficiency and productivity. New employees need time to understand a company’s business policies and procedures, how to solve problems, and meet expectations. Customer satisfaction depends on fast and friendly customer service, and it can be compromised by errors, repeated questions, or delays.

They Don’t Return

Repeat customers can significantly increase the ROI and reputation of your business. They provide you with consistent income and become loyal supporters, recommending your company to several other potential consumers. However, employee turnover can damage customer loyalty and even prevent people from becoming repeat visitors. A customer who receives poor service due to negative workplace culture or overloaded employees resulted from turnover might never come back to your store after an initial purchase.

How to Improve Retention and Customer Satisfaction

A waiter providing good customer serviceIt’s crucial to hire the ideal applicants to mitigate the negative effects of employee turnover. Many successful businesses use pre-employment assessments to screen applicants and make the right hiring decisions.

That’s where Sprockets comes into the equation. Our AI-powered hiring solution predicts an applicant’s likelihood to succeed and stay long-term based on the success profile of your current top-performing employees. Numerous franchisees across a variety of industries have reduced costly turnover with Sprockets. You could be next!

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The Effects of Employee Turnover on the Rest of Your Team

The Effects of Employee Turnover on the Rest of Your Team 1016 528 Sprockets

Losing an employee costs time and money, but you also must consider the effects of turnover on the rest of your team. It can negatively impact company culture, productivity, and overall satisfaction for both managers and employees. Let’s dive into the various ways turnover can hurt your business and discuss the best options for avoiding them.

How Employee Turnover Affects Your Team

The Employee Experience

First of all, a lackluster recruiting process that results in new hires that don’t fit the company culture, or are otherwise unqualified, puts stress on the current team. Existing team members lose time with their direct manager to the interview and onboarding processes. The time spent on the hiring process is generally carved away from the time managers would typically spend developing their current teams. Administrative and other time-sensitive tasks will likely take precedent over the current team’s development needs. Many development opportunities are lost, and existing employees may feel less valued.

As the poorly placed employee moves toward their eventual exit, the core employee base is forced to take on a heavier workload. In the case of absenteeism, employees must pick up more slack. In the case of poor performance, they face more work in the form of both rework and time spent resolving a series of poor customer experiences caused by poorly performing coworkers.

The Manager Experience

This redirection of energy can negatively impact the manager’s experience at work as well. The loss of development time is not just a problem for their employees. The process of creating relationships while developing individuals and teams is the primary source of professional growth for a manager. When this process is neglected, managers don’t have opportunities to build upon their coaching skill set. The team’s performance improvement efforts will suffer, and the drag on productivity will worsen. Now, the manager faces a new-hire learning curve as well as a slower improvement process for the existing team. 

Company Culture

Another consideration is the impact on a company’s culture. Most companies are very conscious of the culture they are trying to create. Creating an environment in which teams are positioned to perform well requires a lot of education and reinforcement. Consistent reinforcement provides the traction needed for a positive culture to be formed and, consequently, take on momentum. A constant stream of departures and replacements makes the task infinitely harder than it already is.

All great cultures are about creating a sense of team as well as the belief that employees have a productive place to work and perform. When employees experience turnover around them, they tend to doubt both elements. They are faced with the tasks of rebuilding a positive team dynamic and learning to trust new team members. In the case of voluntary attrition, employees will wonder whether their environment is as good as they believe it to be. They might assume people are leaving for better opportunities and working conditions. This is a real risk to the state of employee morale.

Reduce Employee Turnover With Sprockets

Two men shaking hands at a restaurantYour hiring process has a significant influence on employee retention. The challenge is to differentiate between the factors that bring the strong, consistent performers and those that result in poor fits. By focusing on logic, data, and decision quality, you can mitigate the impact of employee turnover on company morale, culture, and productivity.

This is where Sprockets can help. Our AI-powered software predicts the likelihood that applicants will fit with your company’s culture and perform similarly to your most valued employee base. The combination of artificial intelligence, natural language processing, and over 80 years of psychological research ensures that hiring managers make consistent, high-quality decisions. These decisions will play a huge role in slowing the churn in the employee base and allow teams to get back to the business of development and innovation.

Start hiring the ideal applicants and improving retention with Sprockets today!

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How Do You Evaluate the Financial Cost of Employee Turnover?

How Do You Evaluate the Financial Cost of Employee Turnover? 1016 528 Sprockets

If you want your business to thrive in today’s economy, it’s more important than ever to find the best employees in a pool full of applicants. Retaining a good employee once you bring one on board takes some work, but it’s worth the effort because the average financial cost of employee turnover is often significant. Employee turnover comes with a measurable financial cost, but just how much is it?

Employee Turnover Costs

The cost of employee turnover varies depending on your business, industry, and the type of income the worker received. When we calculate the cost of employee turnover, it’s important to take a variety of factors into account.

Some of the various factors include:

  • Recruiting employees
  • Hiring the right employee after selecting from a list of available candidates
  • Onboarding the employee once you’ve hired them

Without a quality candidate identification process, you also may wind up with the wrong pool of candidate employees from which to select. Not having the right candidates for one of your open positions is yet another factor that will increase the average financial cost of employee turnover.

Hourly Employees

We’ll start with hourly employees since these workers typically have the highest rate of turnover. The Center for Hospitality Research at Cornell once conducted a study that determined the average cost of employee turnover for hourly employees is about $5,000. This includes the costs associated with pre-departure, recruitment, selection, orientation and training, and productivity loss.

Salary Employees

When salaried employees leave their employers, the costs that subsequently arise aren’t trivial. Many analysts estimate the financial cost of employee turnover at an average of 6 to 9 months of that turned-over position’s salary. 

For example, if you lose an employee who earns $60,000 annually, expect it to cost between $30,000 and $45,000 to backfill their position. Lose 50 such $60,000 employees annually, and you’re looking at $1.5 million to $2.25 million in financial costs due to employee turnover, at minimum. 

Time Lost Due to Turnover

Also, keep in mind that the time lost due to employee turnover. According to a December 2017 study by the Society for Human Resource Management, it takes an average of 36 days to hire an employee.

The length of time needed to hire employees varies by industry, though. For instance, in 2017, the Chicago Booth School of Business found that it took an average of 13.4 working days to hire an employee in the construction industry. In the healthcare industry, however, it took as long as 48.3 working days to hire a suitable employee.

The longer one of your employee positions goes unfilled, the greater the financial burden can become for your business. The below examples of industries with the longest hiring processes will give you an idea of the potential costs attached to employee turnover:

  • Financial services: 46.2 working days
  • Information: 31.8 working days
  • Education: 28.9 working days
  • Wholesale and retail trade: 25.8 working days
  • Leisure and hospitality: 21.1 working days

If you’re in government at any level and you need to hire someone, expect the hiring process to take about 28.5 days, though it can take much longer in some cases. Here’s an example: 

According to a March 2019 report by the Department of Homeland Security, it takes the Transportation Security Administration (TSA) 183 days to hire a screener to staff one of its airport security checkpoints. It’s difficult to imagine any non-government business thriving if it takes more than six months to hire an employee to fill an open position.

There are tangible as well as intangible costs associated with leaving an open employee position unfilled for more than a month or for any length of time, for that matter. Other employees may need to pick up a departed employee’s work output, for one. For another, some amount of business may be lost or given up until a new employee can be hired.

Employee Turnover Cost Calculators

The beauty of data when it’s used properly by business managers and leaders, as well as human resources professionals, is that you’ll gain solid insights into just where your business is at and where it may need to go. A good employee turnover cost calculator is a tool you can use to gauge what such employee turnover, or “churn,” is costing your business. Generally, an employee turnover cost calculator allows you to:

  • Calculate employee turnover rates.
  • Determine certain costs from lost staff.
  • Build a good business plan that allows you to anticipate some amount of employee turnover.
  • Be better prepared for voluntary employee terminations.

Reduce Employee Turnover With Sprockets

People shaking handsThe truth is that if your business is composed of more than one person, you’ll have to deal with employee turnover. Luckily, Sprockets’ AI-powered solution reduces the number of candidates your company will need to screen or interview by highlighting the employees who will be the best fits based on the success profile of your current top-performing workers. 

You’ll instantly know which applicants will succeed and stay long-term, helping you avoid the financial costs of employee turnover. Contact us today to see how we can help your company reduce employee turnover!

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How Much Time Is Lost When an Employee Leaves?

How Much Time Is Lost When an Employee Leaves? 1016 528 Sprockets

It can be challenging to estimate the average time lost when employees leave. After all, there are numerous potential factors, including your type of business, the amount of training you provide, and your employee recruitment process.

However, every manager and business owner knows that losing an employee costs valuable time. Perhaps more considerably, in most businesses, this time lost equates to money lost as well.

Evaluating the Amount of Time Lost When Employees Leave

There are three main ways that employee turnover can cost your business time:

Of course, losing an employee means you no longer have their labor hours. The work that your former employee was doing is now nonexistent. This is especially true for former employees who don’t give an appropriate length of time for leave notice (if they chose to quit).

You also lose time because you have to devote labor hours toward recruiting a replacement employee. Now, you’re allocating hours toward searching for a new hire. The current labor market, your company’s needs, and the level of skill required for the position can all increase the time it takes to hire a replacement. Plus, you need to advertise and vet potential candidates. Unfortunately, the time it takes to hire employees can be extensive when you don’t have the proper tools to streamline the hiring process.

It’s important to consider the time it takes to properly train the new employee and bring them up-to-speed in the workplace. This amount of time varies depending on your business, but it can be considerable. Don’t forget: You will need to think about how long it takes for a training manager or fellow team member to teach the new employee. This potentially doubles the hours necessary to train a new employee.

What Can You Do?

Implement Strategies to Improve Employee Retention

If you want to avoid the costs of employee turnover and run your business as efficiently as possible, you need to keep your employees happy and healthy. Employee retention initiatives vary from business to business, but the basic concept is to make working at your company preferable to working at a competitor’s company. Some initiative examples include salary incentives, career growth opportunities, paid time off, and insurance benefits. You can even start something as simple as a weekly happy hour for your team to engage outside of work.

Investing in your current employees reduces the lost time and money from turnover. It’s a win-win for both employers and employees to create a positive work environment.

Hire Applicants Who Will Stay Long-Term

Improving employee recruitment is one of the best ways you can reduce the lost time of employee turnover. There are three main ways that a better recruitment process will help you reduce lost time.

First, having a better system in place to locate and hire new employees will make the actual recruitment time period shorter. When this system is improved, you will find qualified candidates more quickly. You will move to the onboarding phase sooner and replace the former employee’s work hours in less time.

Additionally, you will not have to devote as many human-resource hours toward the actual recruitment process with a more efficient system in place. Remember, the hours that your human resource employees spend also factor into the amount of time you lose. These hours could be spent elsewhere.

An improved employee recruitment process also increases the number of high-quality candidates you attract to reduce your turnover. Being able to focus only on the ideal candidates, rather than having to stress about weeding out poor fits for your positions, ultimately reduces the overall time spent.

The Solution: Sprockets’ AI-Powered Hiring Platform

A woman showing a laptop screen of the Sprockets hiring platformOne of the best ways to reduce the time lost on employee turnover is to integrate Sprockets into your hiring process. Our sophisticated solution to hiring combines artificial intelligence and over 80 years of psychological research to identify the ideal applicants for your needs. It’s not magic — it’s logic.

Plus, it’s proven to work with numerous business owners in a variety of industries, including home health care, quick service restaurants, call centers, and more. You could be the next success story! 

A smiling woman holding a sign that says "OPEN"

When Is It Time to Expand Your Franchise Operations?

When Is It Time to Expand Your Franchise Operations? 1016 528 Sprockets

There are a number of important clues you should look for when you are trying to decide when to open the next franchise location. Expanding your franchise operations takes more than a desire to make more money. You have to make sure there’s a large enough customer base and strong enough demand for your product to make the new location a success. 

We have been providing franchisees with the staff they need to successfully expand their franchise operations for many years. We have the expertise and experience to help any franchisee get the staff they need to grow their business at just the right time.

Expanding Your Franchise Operations

Important Considerations

Expanding franchise operations is a major step. It’s one that should not be taken without taking several things into consideration. They include:

  • Are there too many customers for your staff to handle at your current location?
  • Can simply increasing the size of your shop or restaurant handle the overflow?
  • Is your customer base large enough to make a second franchise location profitable?
  • Have you identified the right location for your second business? 
  • Can you find the right people to staff it?

When to Open Your Next Franchise Location

Some of the key factors that can help you decide when to open the next franchise location and ensure it will have a high probability of being successful include:

1. You Have Several Regular Customers

If you have a large number of regular, loyal customers, and your customer base continues to grow, that means there’s a consistently increasing demand for the product or service you provide. No matter what type of franchise you have, repeat customers are the key to success. Don’t base your decision on expanding franchise operations on one sudden spike in customers at your current location. When you see a stable, recurring revenue stream year-round, you should seriously consider opening a second location.

2. Customers Often Ask You About Opening Another Location

If many customers that regularly spend money at your current location keep asking you when you are going to open a second location, it might be time to grow. Being able to better satisfy your customers should be the motivating factor behind expansion plans. Plus, if customers routinely travel a long distance to purchase your products and services, expanding into a second location makes good business sense if you grow based on customer requests and their consistent purchasing patterns. 

3. Your ROI Is Steadily Increasing

If the profit you make from your current franchise location is consistently increasing, it could be a sign the market can support your expansion into a bigger or second location. This decision should not be based on short-term success. However, if the size of your customer base, revenue, and profits show consistent, long-term growth, expanding into a second location could be a lucrative business decision. The key is to make sure that you see a pattern of consistent growth. If customers are satisfied with your products or services, a second location can enable you to profitably serve more customers in a wider area. 

4. Your Franchise Is in a Growing Industry

Before deciding to expand into a second location, study the trends in your industry. If your research shows your industry is growing, now might be the right time to open a second location. Opening a second franchise location is a great way to take advantage of the opportunity for increased income, growth, and stability. By opening up another location, you not only reap lucrative short-term benefits, but you can also future-proof your franchise by providing customers with new products or services.

5. Your Current Location Has Too Much Business

If your franchise is attracting much more business than you can handle in your current location, it might be time to grow. Don’t wait until overcrowding or customers having to endure very long wait times for service begins to hurt your business. If just expanding franchise operations to a second location will allow you to better manage consumer demand for your product or service and even bring in more customers, take action. We can help you hire the additional employees you will need to serve customers at your new location.

6. You Have Done Your Due Diligence

Opening and running a second franchise location requires funding, franchisor approval, potential structural changes, as well as assessing growth potential and possible liabilities. If you’ve done your due diligence, and your calculations look overwhelmingly positive for the outcome of an expansion, and the only real question is when to open the next franchise location, it’s time to open a second location and grow your business. Double-check the details, get professional financial advice, and take the plunge.

7. You Have the Skills, Resources, and Opportunity for Growth

Creating and growing a business requires a unique set of skills, abilities, resources, and opportunities. It also requires vision and courage. In business, there’s no such thing as “a sure thing.” However, if you have the skills, resources, and opportunity for growth, don’t let fear hold you back. Do an evaluation of your business skills, customer base, and potential market size and share. If they all are in your favor, the time is right for you to expand into another business location where new customers are waiting to spend money with you.

8. You Have the Right Team

Running a franchise profitably and successfully requires a team effort. You must have the team with which to share the burden involved in the day-to-day details of managing two business locations. If you have a team with the expertise, focus, vision, customer service, and time management skills needed for a second location to prosper, you are ready to grow. If your team is equipped to take on the challenge, delegate some responsibility as necessary and go for it.

9. You Have a Trusted Network of Outside Experts

Outside experts can give you the help needed for your growing business to prosper. If you have a network of outside experts to give you the help you need, you are ready to expand into a second location with your business. Being willing to listen to and follow the advice of the business experts you hire is essential for success when you expand your business to a second location.

10. You Have Help Hiring the Right New Staff

A woman showing a laptop screen of the Sprockets hiring platformYou know it’s time to open a second location when you need to hire several new employees to serve the large and growing customer base. We can help you to hire the right new employees you need to help your current staff with the increasingly demanding workload.

Sprockets empowers you to hire applicants that are such a good fit that it might seem like magic. However, it’s a result of combining technology, logic, and psychology to identify which job applicants are most likely to be as effective in performing the job as your best employees.

We interview your franchise’s top employees and use artificial intelligence to recommend employees that have similar characteristics. Our sophisticated solution makes expanding your franchise operations easier and much more likely to be successful.

A man and woman looking at a tablet and text reading "How to Maximize Your ROI as a new Franchisee"

How to Maximize Your ROI as a New Franchisee

How to Maximize Your ROI as a New Franchisee 1016 528 Sprockets

If you want to get out of the nine-to-five rat race, become your own boss, and you have some seed investment money set aside, your best bet might be venturing into franchising opportunities. Let’s dig into it and see how a franchisee’s return on investment can be maximized.

Kick-Start the ROI of Your New Franchise Venture

Choose the Ideal Franchise

Once you decide your path is with a franchise, you’ll need to choose the right franchise brand for you. There are numerous franchises out there, so it is a big undertaking to choose which ones offer the most profitable opportunities. Of course, saying this is easy. Making the decision is not. There are several considerations before you find your match made in heaven. 

Conduct extensive research by completing these tasks prior to your decision:

  • Reach out to various franchisors for information
  • Talk to other franchisees about their experiences
  • Consider your initial finances
  • Research your intended location

Build a Business Plan

Preparation is essential if you want to maximize the ROI of your new business venture. While many franchisors provide new franchisees with proven business plans, you might be left to your own devices with certain companies. Don’t worry, though. Simply view our blog on how to build a business plan for a new franchise location. It features a step-by-step walkthrough to help you get started on the right foot.

Track Performance

You won’t be able to improve the ROI of your franchise business if you don’t track performance metrics. Set up a list of business goals and key performance indicators (KPIs) to keep long-term goals in mind while still focusing on the day-to-day operations that drive success. Note: always make sure you set measurable goals rather than abstract ones that are difficult to track.

Then, set aside time monthly, quarterly, or annually to identify areas that need improvement. Find out what went wrong, make a plan for how to get better, then put your plan into action. With hard work and little luck, you’ll stay motivated, surpass your goals, and be able to continuously set the bar higher.

Hire Applicants Who Will Drive Success

Two people shaking hands during an interviewDid you know that employee turnover can cost employers upwards of $5,000? This can drastically reduce the ROI of your franchise when you think about how many employees you might lose over the course of a year. Not only do you lose productivity, but you also need to spend time and money recruiting, screening, and training the replacement employees.

Avoid costly turnover with Sprockets’ sophisticated solution to hiring! We combine natural language, artificial intelligence, and over 80 years of experience to find applicants who are the precise fit for your needs — and are likely to stay long-term. It might seem like magic, but it’s not. It’s logic.