Latest / Franchise Conversations with Fexingo: Buying, Running, and Scaling Franchise Businesses / Franchisees Win by Outsourcing Non-Core Tasks
Transcript
- Lucas: So Luna, I keep coming back to this one number from a franchisee survey we pulled together last month. A huge share of owner-operators say they spend more than fifteen hours a week on tasks that have almost nothing to do with running their business — payroll, scheduling maintenance, chasing down IT glitches. Luna: Fifteen hours. That's basically two full workdays just on the stuff that doesn't move the needle. Lucas: Exactly. And the franchisees who are actually growing — the ones scaling from two units to five, from five to twelve — they've figured out that the path forward is not to keep doing more of that admin themselves. It's to hand it off to specialists who do it cheaper and better. Luna: So we're talking about outsourcing, but not the kind where you send your call center to another country. More like... the boring back-office stuff. Lucas: Right. And today I want to focus on three specific areas: payroll, cleaning, and IT support. These are the three that come up again and again in franchisee conversations, and they're the ones with the clearest return. Luna: Let's start with payroll. I feel like that's the one people think they have to do in-house because it's so sensitive. Lucas: It is sensitive, but it's also a perfect candidate. A typical quick-service franchise with, say, thirty employees is spending maybe two to three hours per week just on payroll — collecting timesheets, calculating overtime, running the deposits. That's time the owner should be on the floor training staff or checking food quality. Luna: And the cost? I've heard some numbers that seem almost too good to be true. Lucas: Well, look at it this way. A dedicated payroll service will charge maybe fifty to seventy-five dollars per pay period for a franchise that size. That's somewhere in the range of thirteen hundred to two thousand a year. Compare that to the cost of the owner's time at, say, thirty dollars an hour — which is conservative for a franchise owner — and you're looking at a real saving of several thousand dollars a year, plus the peace of mind that it's done right. Luna: So you're not just saving money, you're buying back hours. And those hours can go to something that actually generates revenue. Lucas: Precisely. And that's the framing I like: outsourcing isn't a cost, it's an investment that pays for itself. I've seen franchisees use those reclaimed hours to improve their mystery shopper scores, which directly lifts their revenue per customer. Luna: You mentioned cleaning. That's one I wouldn't have thought of, but I bet it's a big one. Lucas: It's huge. A lot of franchise systems require a certain level of cleanliness — that's part of the brand standard. But hiring a dedicated janitorial staff can be a nightmare. Turnover is high, training is constant, and you're liable for all the employment stuff. When you outsource to a commercial cleaning company, you get a consistent crew that's trained to your franchise's specs, and you don't have to manage them. Luna: What's the cost difference? I assume it's not a no-brainer for every location. Lucas: Right. For a smaller unit, say a two-thousand-square-foot space, a cleaning service might run you about fifteen hundred to two thousand dollars a month. If you'd hired even one part-time cleaner at fifteen dollars an hour, that's over two thousand a month when you factor in payroll taxes and workers' comp. So you're saving maybe twenty percent, and you're not dealing with the headache. Luna: Plus, if the cleaner calls in sick, the service has to send a replacement. You're not scrambling. Lucas: Exactly. And the quality is often better because they're specialists. One franchisee I talked to said their health inspection scores went up after they switched to a professional service — the crew knew all the nooks and crannies that health inspectors check. Luna: Now IT support. That one feels trickier because it's so intertwined with your point of sale system and your data. Lucas: It is, but it's also where a lot of franchisees get burned. You have a point of sale outage during lunch rush, and that's lost revenue and angry customers. If you're relying on a cousin who knows computers, you're in trouble. A managed IT service provider — an MSP — will give you a contract with a guaranteed response time. They monitor your systems remotely, they patch software, they handle backups. Luna: And that's the kind of thing that can save you thousands in downtime alone. Lucas: Oh, absolutely. Downtime costs money directly. I've seen estimates that an hour of POS downtime in a busy quick-service restaurant can cost anywhere from five hundred to a thousand dollars in lost sales. If you're having one outage a month that lasts an hour, that's six to twelve thousand a year. An MSP might charge you five hundred a month for a single location. So it pays for itself if it prevents just one outage a month. Luna: So the pattern is clear: you're trading a predictable, fixed cost for the risk of unpredictable, much larger costs. And you're buying time. Lucas: That's the core of it. And it's the same logic that makes you want to outsource other things, like marketing or bookkeeping. But not everything should be outsourced — you've got to keep the things that are your competitive advantage. Luna: Which brings us to the question of when outsourcing can go wrong. Lucas: It can go wrong if you outsource the wrong thing. Your core guest experience — the way your team greets customers, the quality of your food, the cleanliness of your dining area — that's the heart of your brand. If you outsource your front of house staff, you lose control over that. You might save a little, but you could lose loyal customers. Luna: So you keep the customer-facing stuff in-house, but you outsource the back-office stuff. Makes sense. Lucas: And even with back-office, you've got to be careful. Some franchisees have outsourced their bookkeeping and then found themselves in trouble come tax time because the service didn't understand franchise-specific deductions. You need to find a provider who knows your industry. Luna: That's a great point. It's not just about the cost, it's about the fit. Lucas: Before we get deeper into that, I want to take a quick second to mention something that keeps this show going. A lot of you have asked how you can support us, and honestly, the most helpful thing is a small monthly contribution. Even a couple of dollars a month makes a real difference — it helps us cover the costs of putting these conversations together, and it keeps the podcast free and ad-free for everyone. If you've gotten something out of these episodes, you can support us at buy me a coffee dot com slash fexingo. Luna: Yeah, it's a simple way to say thanks. And we really do appreciate it. Lucas: So back to the fit question. That's where the real success stories come from. I was talking to a franchisee who runs five sandwich shops, and he told me about how he vetted his IT provider. He asked for references from other franchisees in the same system, and he negotiated a service level agreement that guaranteed a two-hour response time during business hours. That kind of specificity makes all the difference. Luna: So it's like hiring anyone else — you need to check references and get it in writing. Lucas: Exactly. And that's the framework I want to leave you with. For each of these three areas — payroll, cleaning, IT — you should be asking three questions. One: what's the true cost of doing it in-house, including your time? Two: what's the risk if it goes wrong? And three: can you find a provider who understands your franchise system? If you can answer those, you'll know whether outsourcing is a win or a trap. Luna: That's a practical takeaway. But I also want to touch on the scale question. When does outsourcing start to make the most sense? Lucas: For a single-unit owner, sometimes it's about survival. You've got so many hats that outsourcing payroll and IT can be a lifeline. But the economics really shine when you're scaling. When you go from two to five units, the complexity multiplies — you can't just do everything yourself anymore. That's when a strong outsourcing strategy becomes a real competitive lever. Luna: And it also becomes easier to negotiate better rates when you're buying for multiple locations. Lucas: Right. I've seen franchisees with five units negotiate per-unit rates that are thirty percent lower than what a single-unit owner would pay. Plus, they get better service because they're a bigger account. So there's a virtuous cycle: you outsource to grow, and as you grow, outsourcing gets cheaper. Luna: That's a great point. I also wonder about the cultural aspect. If you outsource too much, do you lose that sense of ownership? Lucas: It's a real risk. Franchisees who outsource everything can end up feeling disconnected from their own business. The trick is to keep the intellectual work in-house — the strategy, the hiring of your managers, the local marketing — and outsource only the tasks that are genuinely repetitive and well-defined. Luna: So it's a balance, not a blanket rule. Lucas: Exactly. And that's the way I like to think about it. Outsourcing is a tool, not a philosophy. Use it where it gives you clear benefits, but don't outsource your brain. Luna: That's a nice way to put it. So what's the one thing you'd like listeners to take away from today's episode? Lucas: For me, it's that you should be auditing your own time this week. For every task you do that is not directly tied to revenue or customer experience, ask yourself: could a specialist do this better and cheaper? You might be surprised by how many answers come back yes. Luna: And if you're already outsourcing something, we'd love to hear how it went — what you outsourced, what you saved, what you learned. You can reach us on the show's page. Lucas: Absolutely. This is one of those topics where real-world examples beat theory every time. We'll have more franchise conversations coming up, so stay tuned.