(Time to read this Blog article is about 60 seconds)

All businesses and industries go through cycles from birth, to growth, to adversity and rebirth, or being taken over, or dying from incompetence.  No business lasts forever. Gekkeikan Sake has been in business in Kyoto, Japan for 378 years, but they’re the exception.   89% of the companies on Fortune 500’s list of America’s biggest companies in 1955 are not on the list for 2014. Many of them don’t exist at all.

Using a more local Toronto example, Lick’s Hamburgers and Ice Cream was founded in Toronto 35 years ago by Denise Meehan.  Their differentiating concept was quality burgers (called Homeburgers), premium ice cream and milkshakes, served joyfully by staff who sang out the orders and called you by name.  I loved Licks.

Who doesn’t love great hamburgers, ice cream and joyful service?   Licks grew to 30 franchised locations…but has now collapsed back to three. 

Even the original iconic flagship location in Toronto’s trendy Beaches area has gone. Gourmet burgers are still a hot item and good ice cream never loses its appeal.  So, what happened? 

I don’t know for sure but from my experience in coaching businesses around the world, here are some of the possibilities. Certainly, there’s a lot more competition in the premium burger space with several trendy new arrivals.  But Licks had a head start; they had a brand and a loyal following.  So, did their execution falter?   Did they recruit inappropriate franchisees who weren’t a good fit with the product, or the culture of joy?  I see this one a lot.   

Did head office fail to train and support the franchisees effectively?  Did they not maintain and update their locations?  Did the concept get tired or did the people at the top simply ‘run out of gas’ or did the business grow beyond management’s ability?  Thirty-five years is a very long time to run a business; especially a franchise business with the inevitable conflicts that always exist in that business model. 

So, there’s a time to get in, a time to get bigger and a time to get out.  It’s all about the business cycles and the human energy cycles.  It’s about being in touch with your market and yourself.  Where is your business and your industry in the cycle…and where are you?  This is important stuff to think about. 

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