GLOSSARY
Exit quality ratio
The exit quality ratio measures terminations plus “ceased operations — other reasons” as a share of all outlet exits. Item 20 does not say why an outlet left, so it is a signal to investigate rather than a count of failures.
Not all franchisee exits are equal. A transfer — one operator selling to another — keeps the unit open. A termination or a unit that ceases operations does not. The exit quality ratio isolates the bad exits from the total, surfacing rot that healthy-looking transfer volume can hide.
It is one of the inputs to the Watch Desk verdict.
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