In a recent episode of the The Advisory Board Podcast, host Dave Hansen sits down with one of the biggest names in the franchise world—John Hewitt. Known for founding both Jackson Hewitt and Liberty Tax, and now leading Loyalty Brands, John shares decades of experience and unfiltered advice on why so many franchises fail. With over 55 years in the industry, more than 5,300 franchisees, and 11,000 units under his belt, John’s knowledge is essential for anyone involved in franchising today.
This episode is built around a hard truth: 80% of franchise brands started today will fail within 10 years. Through John’s insights, the episode breaks down the core reasons behind this staggering number and what franchisors can do to stay out of that statistic. What makes this conversation unique is its focus on practical, experience-based knowledge. John doesn’t just talk about the problems—he explains what can be done to avoid them.
Let’s dive into the top takeaways from this powerful conversation and explore what really causes franchises to fail—and how to avoid it.
The Unique Management Skillset for Franchising (13:30 – 15:20)
One of the most eye-opening discussions in the episode focuses on the shift required when transitioning from managing employees to managing franchisees. Franchisors often make the mistake of using traditional top-down management styles, which don’t translate well to a franchise environment. Franchisees are business owners, not staff, and that requires a leadership style that prioritizes partnership and empowerment rather than control.
Franchisors who fail to make this mindset shift often run into problems with compliance, satisfaction, and performance. Understanding this unique dynamic is essential to building a franchise network that works in the long run. The key is creating a supportive environment where franchisees feel like respected partners.
Leadership Blind Spots in Franchising (16:00 – 18:00)
Another major issue discussed is the lack of self-awareness among franchisors. Many assume that because they were successful in running their original business, they’ll automatically be good at leading a franchise. This assumption leads to neglect in developing new leadership skills, and more importantly, in supporting the success of franchisees.
Franchisors often fail to recognize the critical role they play in guiding their network. When leadership doesn’t evolve, it becomes a bottleneck. Weaknesses go unnoticed, and systems begin to break down. The conversation stresses the need for reflection and growth at the leadership level to ensure long-term franchise success.
Misguided Focus and Financial Pitfalls (20:10 – 22:00)
One of the most common traps in franchising is the pursuit of rapid growth without the financial stability to support it. Many franchisors expand too quickly, shifting their focus to opening new units while neglecting the profitability of existing ones.
This misalignment can drain resources and lead to dissatisfaction across the network. Franchisors must prioritize financial health and ensure their franchisees are profitable before chasing aggressive expansion. Growth should be a byproduct of a strong foundation, not a distraction from building one.
Leveraging Brand Recognition (22:05 – 24:00)
The episode also addresses how to make brand recognition actually work for franchisees. A strong brand can attract customers, but only if it’s leveraged correctly. This means aligning marketing, operations, and training so that franchisees benefit directly from the brand’s strength.
Simply having a known name isn’t enough. Franchisors need to ensure the brand consistently delivers value at every location. When this happens, franchisees are better equipped to succeed and customers receive a more reliable experience.
Commitment Over Capital (32:00 – 33:50)
The final key takeaway highlights the idea that success in franchising is less about having a lot of money and more about commitment, effort, and the right mindset. Many franchisees and even some franchisors assume that financial investment alone is the path to success.
In reality, consistent effort, strong leadership, and an unshakable focus on supporting franchisees play a much larger role. Those who are committed to growth, willing to learn, and ready to put in the work are far more likely to succeed.
Wrap-Up Thoughts
This episode of The Advisory Board Podcast with John Hewitt is essential listening for any current or aspiring franchisor. John’s experience across multiple decades and franchise systems brings clarity to the real challenges facing today’s franchise leaders. The insights he shares are both practical and proven—born from years in the trenches of franchise growth and development.
From identifying blind spots in leadership to managing financial priorities and treating franchisees as partners, this episode outlines the blueprint for franchise success. It also serves as a powerful reminder that growth is only sustainable when built on a foundation of profitability, leadership development, and genuine commitment.
For more insights on tools and systems that can help franchises succeed, visit ClientTether. To explore John Hewitt’s work and how Loyalty Brands is setting a new standard in franchising, check out Loyalty Brands. You can watch the full podcast episode on YouTube or listen on Spreaker.
