Do Business Well

What franchisees expect from their franchisor

More often than not, budding entrepreneurs choose the franchise route because they want to be in a business of their own without being alone. They are quite happy to pay the initial and upfront fees prescribed by the franchise agreement as long as they receive perceived value in return. And they willingly follow the guidelines contained in the operations manual as long as they are up to date, relevant and practical to implement. In return, they will expect the following from the franchisor:

Full disclosure. The franchisees will want to know the true potential of a site. If it takes, on average, 10 months to reach break-even in the business, the franchisee does not want to be given projections that show this period to be 5 months. Nor will he want to be told that it will cost R350 000,00 to set up a new store if past experience has shown that R500 000,00 is much closer to the mark. If the store is a resale, or a failure has occurred in the past, the franchisee will want to know the real reasons for this mishap.

Absolute integrity in all dealings. If a franchisee appears unsuited for a specific franchise, be it emotionally or physically, he expects to be told before he has made a sizeable investment.

The highest level of professionalism. If the franchisor recommends an equipment package or enters into purchase arrangements on behalf of the network, franchisees will not only expect that he has done his homework, but that he kept their interests in mind throughout. In franchisees‘ eyes, this would mean much more than the simple fact that every item works, and that satisfactory arrangements for ongoing support are in place.

Financial advantages. Franchisees would expect that tangible financial advantages accrue to them. Should the franchisor himself be a key supplier to the network, franchisees will expect him to supply them at prices and offer them conditions that are at least as good as, but preferably better than those that are available to their independent competitors.

• First class training. Franchisees know that the better trained they are, the more likely they are to meet and exceed customer expectations. This is a vital prerequisite for building up market share quickly and will help them to reach the all-important turning point of “break-even” by the projected date or sooner. They therefore expect training that is tailored to their real needs and delivered in a professional atmosphere that is conducive to learning.
• A comprehensive operations manual. Having been told that the operations manual is the “bible of the business“, franchisees will expect it to be comprehensive and arranged in such a way that solutions to every day problems can easily be found. Regular updating of the manual to ensure its ongoing relevance would form part of these expectations.
• Unstinting operational support. Comprehensive assistance during the initial stages, offered enthusiastically, will go a long way towards cementing the franchisor/franchisee relationship. And even after the initial learning curve has been mastered, franchisees will continue to expect their franchisor to be there for them should the need arise. The way they see it, the payment of management services fees is an ongoing obligation, so why should an important part of the support they have become accustomed to suddenly fall by the wayside?

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