Insights and Strategies in Navigating the Franchisee-Franchisor RelationshipIt's more personal than it seems.
ByMark Siebert•
Opinions expressed by Entrepreneur contributors are their own.
The following excerpt is from franchise expert Mark Siebert's bookFranchise Your Business。Buy it now。
As a new franchisor, you may find thenature of your relationship with your franchisees to be uniqueand even, on occasion, daunting. While you have the right and the obligation to enforce system standards, your franchisees often view themselves as an independent business (which they are) with the ability to call their own shots (which they are not).And while the relationship is contractual in nature, if you are ever forced to bring out the contract, the relationship is already in jeopardy.
Thus, the franchisor must pay particular attention to the franchisor-franchisee relationship from the very start if they want to create a long-term and mutually prosperous undertaking.
Related:These Are the Top 200 Global Franchise Brands in 2023
Franchises are not like marriages, but joint ventures are
We have often heard peoplecompare the franchisor-franchisee relationship to that of a marriage。They will talk about the "honeymoon" period and how the franchisor and franchisee are in "partnership" together for a common purpose.While this analogy may have some merit, our feeling is that a marriage is exactly what the franchise relationship should not be.
When we think of marriage,we think of a joint venture relationship。In a joint venture, there are partners. Because of the relatively equal footing of the"partners," the typical joint venture starts out with a negotiation--and is often a series of ongoing negotiations. Like a marriage, there are the "who does the dishes" issues, and then there are the more serious issues, such as money. Because each joint venture is unique, every one of these issues is usually subject to negotiation.
Because ajoint venture partner typically is compensatedbased on how much money goes to the bottom line, one concern that most "spouses" have is how the accounting gets completed. On a one-off basis, this is fairly easy to monitor. But on a massive scale, it is almost impossible. And when yourjoint venture spouse does cheat on you, it can become a battle among equals in divorce court. In fact, that is one of the big differences we find between franchising and joint ventures.
Related:Tips and Strategies for Using the Balance Sheet as Your Franchise Scorecard
Franchises are like a parent-child relationship
The franchisee, like a child, will go through a variety of growth phases during the course of their life.
- They are typically very dependent on their parents in the beginning, relying on them for the education and training that will allow them to survive in this world.
- As they grow older, they become less dependent, and you begin to allow them some latitude--first playing in the yard and eventually crossing the street on their own.
- 随着年龄的增长,他们将开始测试he boundaries of their relationship and perhaps break some of the rules.
But they still live in your house, and what you say, goes。It is simply a question of how forcefully you choose to put your foot down.
Related:How to Determine Your Franchise's KPIs and Achieve Profitability
How to be a good parent
Afranchisor needs to start by establishing the boundaries of the relationship。It is important that the franchisee understands that your first role as "guardian" is to guard the system and the brand so all franchisees can continue to thrive. Thus, one of your most importantroles as a franchisor is that of disciplinarian。To do that, you need to clearly communicate the rules and your intention to enforce them from the start.
At the same time, it is important to understand that, as a franchisor,discipline can no longer be meted out the wayyou may have when you owned all your operations yourself. If you try to give a franchisee the "it's my way or the highway" speech that worked so well before, you'llquickly find yourself with alienated franchisees。
Franchisees are business owners. And as such, they require you tocommunicate with them in a professional manner。Being firm with franchisees, as opposed to managers, also means providing them with an explanation for your various "requests." Most franchisees have a key desire for their opinions to be heard.A franchisor should thus avoid making decisions in a vacuumand providing direction to franchisees without a clear explanation of why the direction is being given.
Communication is key
在当今社会低,这是所有too tempting to rely on the internet for all our communications. But in a franchise context, that would be a big mistake. All too often, we have seen well-intentioned e-mails ignite a firestorm when they are misinterpreted.
Relationships are built with dialogue, so it's important that you encourage dialogue in every aspect of the relationship. Good franchisors are careful to create multiple venues where constructive dialogue will occur.Annual conventions, regional meetings and advertising councilsprovide this two-way communication.
To be effective, communication needs to be more than frequent. It needs to be honest. While there are some things you may choose not to share with your franchisees, thekey to a long-term sustained relationship is trust。和信任开始开放和诚实。得到caught in a lie once, and you have destroyed that trust forever.
Your staff and advisory council should be approachable
The accessibility of your senior staff is vital。I have known the senior executives of some fast-growing franchisors who will not go home for the night until they have personally returned every franchisee's call.
One of the most important tools at afranchisor's disposal is the franchise advisory council。As the franchisor, creating this council not only allows you to control the agenda, but also assures you have a voice on it. The last thing you want to do is find out your franchisees have formed an organization without you—that's usually a sign something is wrong, and they have excluded you from the process of resolving the grievance. Whatever comes next is usually not pretty.
Related:These Are the Top 200 Global Franchise Brands in 2023
If they do well, you do well
Lastly, to be effective, you have togenuinely care about the success of your franchisees。Good franchisee relationships start with a franchisor that is, first and foremost, committed to franchisee success. That commitment, more than anything else, needs topermeate the franchisor organization at every level。
If yourfranchisees do not sense your commitment, the relationship can quickly become adversarial. If, on the other hand, your franchisees see youbreaking your back to help them achieve their success, there is almost nothing they won't do for you.
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