Franchising is about transferring functions from Franchisor to Franchisee. Franchisor owns the brand name and operation manual, responsible for marketing. Franchisee owns the business, using the franchisor’s brand, to run the business. Franchisee is responsible for the finance, cash flow, staffing and the inventories.
Franchisor and Franchisee may be jointly responsible to look for location. The Franchisor may take up the lease and sublet to franchisee.
From the above relationship, do you consider the franchising as a partner or consortium?
When you consider the franchising as partner, your expectation would be different. As a partner, you would want the franchisor to support you for all changes or adjustment to the local market conditions.
As partnering relationship, you may have an understanding and an open communication between the franchisor and you. Beside yourself, you may appoint your assistant to follow-up. Likewise you may request a list of persons for contact and their area of expertise.
From the communication, you would able to know how committed we are.
What would the scenario be if you do not consider franchising as a partnership? Franchisor may take the opportunity to request for high initial fee. Subsequently they may not be able to offer the support you requested. Franchisor also afraid of you not adhering to their operations guides and dilutes their brand.
Do you think that you are having a win-win situation?
Getting the right start is important to the success of franchising.
Managing the expectation of franchisor is important. More important would be your expectation in franchising.
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