Becoming a franchisor and building a franchise business means that you have to wear a number of different hats – most, if not all of which, will need to be worn at the same time. For anyone looking to franchise their business, it is vital to have a clear understanding of the legal obligations and duties that are part and parcel of being a franchisor and which will be set out in the franchise agreement. It’s also important to have insight into what your key roles and responsibilities will be when taking on on the title of franchisor and leading the brand and franchise network from the front.
Franchisee recruitment and training
Whether at the beginning of the franchising journey or a long way along that road, a franchise brand grows and thrives with the ongoing recruitment of franchisees to the network. New blood not only brings additional revenue into the business, but also can provide an injection of fresh energy – and very possibly fresh ideas. One of a franchisor’s greatest responsibilities is to ensure that new franchisees coming on board are a great fit for the brand and the team, that they have the correct characteristics and skillset and that they are correctly and fully trained to be able to successfully launch and run their franchise business. If this responsibility is not properly fulfilled then there is a real risk that the franchise will risk reputational damage, impacting on the entire franchise network.
Maintaining standards
It follows on from the paragraph above that a franchisor has an ongoing responsibility to monitor standards of delivery of the product or service by franchisees to ensure that there is quality and consistency across the network. Hand in hand with that is the responsibility to take corrective or remedial action in situations where standards are not being maintained or there is another material breach of the franchise agreement. Being a franchisor means that tough, challenging and often uncomfortable decisions need to be made, but making those is the franchisor’s duty to their franchisees and to the brand.
Franchisee advice, development and support
A well supported franchisee is most likely to be a happy and engaged one, and a happy and engaged franchise network can become a franchise brand’s biggest asset. A successful franchisor will recognise that they have an ongoing responsibility to their franchisees that extends way beyond the initial training programme. They should nurture their franchisees, offer opportunities for ongoing training and development and provide advice and support when required.
Business development and innovation
For any business to thrive it must keep moving forward and innovating. A major responsibility of a successful franchisor is to keep abreast of current and future consumer and market trends and to ensure that the brand is in the healthiest and strongest position to react to them. This will include making sure that the franchise’s product or service remains up to date and relevant and that it stays a step (or more!) ahead of the competition. The franchisor should always be looking at the bigger picture for the business and looking to develop new opportunities for their franchisees.
Improving systems and procedures
The franchisor will have developed a business model, supported by systems and procedures to be accessed by the franchisees to enable them to run their businesses successfully and profitably. But things change over time – markets adapt, technology improves and new industry challenges surface. A franchisor has an ongoing responsibility to keep their franchise systems and procedures under regular review, to obtain feedback from franchisees, and to develop and implement infrastructure change when and where required to keep the core business and those of their franchisees working efficiently and productively.
Raising and maintaining brand awareness
One of the primary reasons that a franchisee is likely to have joined a franchise team is to become part of an already established brand with a great reputation. Although the franchisee will of course carry out their own local marketing activities to raise awareness of their business within their local community, the franchisor is responsible for carrying out marketing and brand awareness activities nationally, or globally if that is the scope of the franchise brand, making sure that the brand remains consistently visible and continues to attract new customers and opportunities.
As their business begins grow, a successful franchisor will identify where they need additional support and assistance in meeting and surpassing their responsibilities towards the brand and their franchise team and is likely to develop an operational team to help them to deliver, and even wear to some of their “hats” for them. But whatever the size of and scale of the franchise, the franchisor must be the one to wear the captain’s hat, utilising their skills of leadership, communication and resilience to keep the business on course and steer their franchise team towards success.
Read the full article here