Whether you’re a numbers person or not, there are lots of metrics to track when you run a franchise. Luckily, there are reputable franchises that offer ongoing support for building a strong business. We’ve compiled some of the most important numbers to focus on and how you can get them.
Focus Success Metrics on Customers
Also known as customer churn, you’ll want to have a thorough understanding of how many people come back to your franchise. Success here doesn’t mean you won’t have any lost customers – that will always exist.
Monitoring your churn rate means you can identify problems that are leading to losing too many customers. This can be measured by choosing a specific time period and dividing the number of customers you lost by the number of customers you had during that time. You don’t want to lose customers faster than you can bring in new ones (this high churn rate means you have low customer loyalty).
Customer Acquisition Cost
How much do you spend to bring customers in the door? That’s your customer acquisition cost (CAC). This metric is useful in relation to the customer lifetime value (CLV). Having a ratio of your CAC to CLV will offer insight into how much profit you’ll make in a given time. If your CAC is lower than your CLV, you’ll be making money rather than breaking even or losing profit. This ratio can help you determine patterns with your other metrics, so if there are adjustments to be made in your marketing efforts or other areas of operation, you’ll have a clearer understanding.
Customer Satisfaction Score
Also known as CSAT, this satisfaction score keeps you connected to your customers with real-time feedback. You might monitor Google and Yelp reviews, send out surveys after purchases, or use a combination of data-tracking methods.
Beyond real-time understanding, trending CSAT over time can help you to stay ahead of problems, know what customers want to see, and build a stronger connection.
Net Promoter Score
Another, more in-depth way of gaining feedback from customers is through a net promoter score (NPS). This is a survey that you send out to customers (in many cases, once per quarter) to gain information on how likely they are to recommend your services to others. The information comes in ratings from 0-10, with zero being not likely at all, and ten being extremely likely to recommend.
Once you have this information, you subtract the percentage of detractors from the percentage of promoters. This gives you a final NPS score.
Don’t Forget to Track Employee Success
Employee Net Promoter Score
This is the same idea as your NPS score for customers, except you’re gaining feedback about your own company. It’s crucial information to use when focusing on employee satisfaction, engagement, and culture. You’ll have insight into how you can change things for the better, and what’s working well that should be kept up.
Franchise owners with The Covery Wellness Spa receive endless support and advice on how to manage successful businesses. Don’t hesitate to reach out with questions!