Franchising in the Age of AI: A Perspective from Paul Flick

When I launched 360° Painting in 2006, my goal was simple: give entrepreneurs a proven system to build a painting business with more autonomy than a corporate job could offer. That single brand grew into Premium Service Brands, a portfolio of niche home-service franchises with more than 1,000 locations across the U.S. and Canada. In 2022 I founded Extraordinary Brands, a multi-brand platform in the boutique fitness and wellness space, because I believe franchising empowers people to build purpose-driven businesses. As both a franchisor and a multi-brand operator, I've learned that lasting success depends on two things: building the right culture and embracing the right technology.

Artificial intelligence is the latest technology wave promising to transform our industry. According to a 2026 franchising report, 72 percent of U.S. franchise companies plan to adopt AI within three years, and 63 percent of franchise operators believe AI will improve customer engagement. Those numbers underscore the urgency, but they don't tell the full story. Implementing AI is not about bolting on a chatbot or buying a shiny new tool. It's about improving the way franchises recruit, train and serve people.

Where AI makes a difference

In a Forbes Council post, I outlined several areas where AI can reshape franchising. Franchise development is one of them: AI can analyze data to identify the traits that make a successful franchisee and help franchisors refine their recruitment strategy. Chatbots on websites and social media channels answer routine questions and schedule services, freeing staff to focus on higher-touch interactions. Personalized marketing powered by machine learning tailors campaigns by demographic, saving time and increasing conversion. And in an industry where training is mission-critical, AI enables virtual role-playing sessions; franchisees at Premium Service Brands use virtual reality headsets to practice sales calls with artificial humans, and after two sessions we saw sales call confidence increase by 35% to 50%.

At Extraordinary Brands, our wellness franchises rely on a unified technology platform that combines point-of-sale, customer relationship management (CRM), data and AI tools for end-to-end customer-lifecycle management. These tools allow our owners to track member journeys, optimize sales efforts and improve retention. The goal is not to replace our coaches or instructors but to give them better information so they can deliver a more personalized experience.

Beyond our brands, AI is already delivering measurable benefits across franchising. One legal advisory notes that AI can optimize inventory, automate customer service with chatbots, personalize lead generation and marketing, and complete complex market research in minutes. It also highlights emerging uses such as compliance automation and analytics for monitoring franchisee adherence. In other words, AI isn't a gimmick — used properly it can improve efficiency and create new revenue streams.

AI will never replace the human touch. It's a tool to augment it.

Lessons from our AI journey

Just because AI is powerful doesn't mean it's a panacea. We've seen enough trends come and go to know that the wrong implementation can create more problems than it solves. Here are a few principles I recommend to every franchisor and franchisee considering AI:

• ·Start with clear objectives. Before we added AI to our training program, we formed a task force across departments to define what we wanted to achieve. We chose training because we believed improving franchisee skill and confidence would drive sales. Define your objective — whether it's reducing call times, improving lead conversion or shortening onboarding — and measure against it.
• ·Choose the right partner. A good AI vendor should integrate with your existing systems and understand your industry. Look for vendors with strong reputations and customer testimonials and insist on demonstrations before signing a contract.
• ·Pilot and iterate. We tested our AI training tools with a handful of franchisees before rolling them out system-wide. Collect feedback, iron out the kinks and measure results. In an industry built on replicable systems, a bad implementation can damage your brand's reputation.
• ·Adapt beyond technology. Adapting to change means more than offering the latest gadgets. It also means adapting your office and culture so that every team member can succeed. AI will never replace the human touch; it's a tool to augment it.
• ·Respect the legal and ethical landscape. AI introduces new risks — from bias in decision algorithms to data-privacy concerns. Franchise law experts warn that franchisors must ensure their AI systems comply with data-privacy regulations and that both franchisors and franchisees receive formal training on AI-related issues. Investing in governance and transparency up front will save headaches later.

The road ahead

The potential of AI in franchising is enormous, but so is the responsibility. Many franchise companies are jumping in head-first; research suggests that only 58 percent have a documented AI policy and 35 percent report inadequate governance. As stewards of household brands, we can't afford to treat AI adoption like a fad. At Premium Service Brands and Extraordinary Brands, we approach AI the same way we approach franchising: with a long-term mindset, a commitment to people and a belief that technology should enhance — not replace — the human experience.

Franchising has always been about providing people with a proven system and the support they need to succeed. AI gives us a powerful new set of tools to deliver on that promise. If we integrate it thoughtfully — keeping objectives clear, partners vetted, pilots controlled and our culture inclusive — it will help us build franchises that are more efficient, more profitable and more human than ever before.