New Trends Emerging from FranConnect’s Mid-Year Sales Index Report

Presented by Keith Gerson, CFEPresident of Franchise Operations

FranConnect

--AND FEATURING—

Joe MathewsChief Executive Officer

Franchise Performance Group

October 12th, 2021

ABOUT FRANCONNECT…

30 daysto realize value

900+franchise brands

30 Countries

8,500+ Franchises Sold Annually

Average Session Per Day

38,000

1B+Royalties Collected$

280k+franchise locations

Introduction to your Presenters:

Keith Gerson, CFEPresident of Franchise OperationsFranConnect

Joe MathewsChief Executive OfficerFranchise Performance Group

Brands by Franchise Size1st & 2nd Quarters 2021

600 Total Brands

71.3% of Brands in Study are Made Up of Personal Services, QSR & Residential Services

Personal Services QSR Commercial &Residential Services

Business Services Retail Food Retail Products &Services

Table Full ServiceRestaurant

Automotive Lodging

2021 36.5% 18.8% 16.0% 7.7% 7.0% 5.8% 5.5% 1.7% 0.8%

Brands by Vertical - 1st Half 2021

Top-of-Funnel Leads

2021 Franchise Sales Index

Franchise Leads Rebound by +18.3% During the First-Half of 2021 vs. Second-Half of 2020

Decrease Increase

21.8% 41.7% 16.1% 18.1% 18.3%

Overall Deals

Jul – Dec 2020 / Jan – Jun 2021 (Cycle over Cycle Comparison)

Overall Deals Increased by Nearly 20% in 1H21 Lead by Enterprise Brands at 59.6% of Sales

Increase

5.0% 55.6% 8.9% 17.4% 19.8%

All But Two Vertical Markets Saw Increases in the Average # of Deals Per Month Achieved

Decrease Increase Decrease Increase

3.1% 92.5% 7.5% 29.9% 46.1% 46.7% 39.3% 60.9% 366.7% 19.8%

The Greatest # of Sales Came from Websites, Referrals, Organic Leads and Franchise Brokers

% of Closed Deals to Leads1.1% 6.5% 4.5% 5.5% 0.4% 0.4% 1.8% 0.4% 3.9% 0.4%

Trusted Sources Reflect Highest Lead toDeal Ratios in 1H202 Jul – Dec 2020 / Jan – Jun 2021 (YoY)Increase Decrease Increase Decrease No

Change47.7% 22.7% 2.3% 178.6% 28.6% 83.3% 33.3% 300.0% 100.0% 2.3%

Franchise Referral ConsultantLeads & Deals

Brokers continue to be one of the highest for deal conversion rates

Our Top Five Broker Rankings based on LTD has Top Honors Going to FranNet at 9.5% vs. Industry Avg of 5.5%

Increase Decrease Increase

21.8% 8.0% 1.7% 25.6% 36.1% 22.2%

Referral Performance

Referrals remain the highest converting source of deals

At 6.5 LTD Ratio, Referrals Do Well Regardlesss of a Brands Size – However Mid Market Rules the Roost

Increase Decrease Increase

733.3% 48.9% 95.3% 20.3% 47.7%

Franchise Websites

These are later stage, knowledgeable leads generally noted as higher quality.

All Market Segments Saw an Increase in Website LTD Conversion Rates Growing from 0.6% to 1.1%

Increase

83.3% 100.0% 57.1% 116.7% 83.3%

Portal Leads & Deals

The most prolific source for cost-effective leads, but are they quality leads?

Top 10 Portal Lead to Deal Conversion RateJul – Dec 2020 / Jan – Jun 2021 (YoY)

Increase Decrease Increase NoChange

Increase Decrease

28.6% 36.4% 50.0% 25.0% 100.0% 6.3% 9.1% 4.3% 14.3% 4.5%

The Real Key to Success is Effectively Managing What is Inside the Funnel

A Focus on Speed to the Lead, Nurturing and New Technology

It’s All About Speed to the Lead!

82% of All Culminated Deals Were Those Engaged with in 4 Hours or Less *Jan – Jun 2021

Only 24.5% of Contacts Were Achieved in Four or Less Hours

Jan – Jun 20210-4h, 24.5%

4h - 1 Day, 9.2%

1 Day - 7 Day, 9.3%>7 Days, 6.0%

No Response, 51.0%

Leads to Deal Conversion Fall-Off Dramatically Beyond the First Four Hours

Jan – Jun 2021

Leads with No Callbacks Are Appalling Jan – Jun 2021

304658 Total 2021 LeadsReduced Worsened

19.2% 35.2% 22.9% 3.8% 13.9%

Leads with No Activity by Segment is Equally DisturbingJan – Jun 2021

Reduced Worsened

40.5% 75.3% 86.8% 14.3% 38.6%

From Inquiry to Close, the Sales Cycle Was Reduced from 142 days to 114 days

Improved

19.8% 19.3% 1.6% 34.5% 19.7%

New Technologies for Driving Franchise Sales: The Sales Accelerator

Focus on Booking and Keeping of Candidate Appointments

INTRODUCING FRANCONNECT SALES ACCELERATOR

Increase Your Franchise Sales Effectiveness with Artificial Intelligence (AI) and Advanced

Workflows

CRITICAL LEADING INDICATORS:

1. 82% of all closed deals were those contacted within 4 hours.

2. 51% of leads never receive any callback

3. 48% of leads marked dead due to "no response"

4. 68% of leads come into Sales outside of traditional working hours

CRISIS IN EXECUTION

Lauren, a prospective franchisee, fills out a form on the Home Alone Security franchising website…. HOME ALONE

SECURITY

DEMONSTRATION…

The FranConnect Sales Platform captures Lauren as a new lead and assigns her to a Sales Rep

DEMONSTRATION

• Lauren immediately receives a series of SMS text messages from the franchisor to schedule a first meeting.

• Lauren interacts with Sales Accelerator’s Conversational AI bot to easily schedule a meeting.

• The Scheduling Assistant uses Natural Language Technology to interact with the prospect.

As soon as Lauren confirms the appointment, the sales rep gets a calendar hold for the call.

And Lauren simultaneously receives a calendar request.

Prior to the meeting date, Lauren receives reminders via text message.

Lauren Jones

SCENARIO: MEETING NURTURING

The system will automatically send a series of reminder messages to keep the prospect engaged

and minimize the chances of a no-show

BRANDS USING SALES ACCELERATOR SEE DRAMATIC IMPROVEMENTS IN BOOKED AND

KEPT APPOINTMENTS

NURTURING AND FOLLOW-UP

Hi Lauren, just a reminder that you are confirmed for a consultation with one of our franchising experts tomorrow at 1:00 PM!

Just let us know if you have any questions or need to reschedule for any reason!

Hi Lauren – we are looking forward to talking chatting with you about franchising with Home Alone Security… see you in 1 hour!

Today, 12:00 PM

SUMMARY: STOP CHASING & START SELLING

• Increase number & quality of digital leads

• Achieve instantaneous lead follow-up

• Automate 90% + of call scheduling

• Improve lead to appointment rates

• Reduce “no-shows”

Sneak Peak at Q3 2021 Highlights

38

Q3 UPDATE: BETTER SALES EFFICIENCY

1.0% 1.0%

1.6%

0.0%

0.2%

0.4%

0.6%

0.8%

1.0%

1.2%

1.4%

1.6%

1.8%

FY 2020 Jan-Jun 2021 Q3 2021

Deal:Lead Ratio

39

Q3 UPDATE: DEAL FLOW INCREASING

1.29

1.66

2.35

0.00

0.50

1.00

1.50

2.00

2.50

FY 2020 Jan-Jun 2021 Q3 2021

Deals / Brand / Month

40

1. BeTheBoss.com2. BizBuySell3. Franchise Direct4. FranchiseGator5. Franchise Opportunities Network

<tie>

Franchising.com

Q3 TOP PORTALS FOR CLOSED DEALS

41

1. Franchoice2. Franserv3. FranNet **4. IFPG5. BAI (Business Alliance)

Q3 TOP 5 REFERRAL CONSULTANTS FOR CLOSED DEALS

Top Deal:Lead Conversion Rate (10.2%)

Want To See FranConnect In Action?

https://www.franconnect.com/demo-sales-accelerator/

Check Out our Other Resources

IF YOU’RE READY FOR MORE FROM FRANCONNECT…

Benefitting From This Webinar?

https://www.franconnect.com/webinars

Talk to Us!

https://www.franconnect.com/request-a-demo/

Q&A Session

Thank you for your participation!