However, the relationship that exists between the franchisor and the franchisee relationship is one that is mutually beneficial; the franchisor having tested the market, proved that the business model is viable, and, in the case of British Franchise Association (bfa) members, committed to operating in accordance with the bfa’s code of ethics, and the franchisee having invested a considerable amount of time and money in their franchise business and contributing to the growth and ongoing success of the network and the brand.
Many feel that the strength of this unique business relationship will prove to be a key factor in helping franchise businesses through the difficult economic times that lie ahead.
Tom Endean, marketing manager at the bfa, said: “As a business model, franchising has witnessed many success stories in recent months, in spite of the economic turmoil. This robust characteristic of franchise businesses can be largely contributed to the structure in which they operate; held together by a mutually beneficial relationship between franchisor and franchisee.
“This relationship is one of shared trust and understanding, combined with the contractual obligations of the initial and ongoing business agreement. When this is set up correctly and injected with professionalism, open communication and an enterprising nature, this relationship can provide the foundations for an incredible success story.”
However, this is not without sacrifice or compromise. Being successful as a franchisee relies heavily on following a detailed business model and demonstrating ongoing commitment to the franchisor’s philosophy. There will be times when differences of opinion arise which can result in the business relationship being tested.
Mr Endean added: “In these situations it is important that both parties have the right temperament to deal with these differences professionally, objectively and swiftly, as any time wasted could affect the business.
“It is essential to have the right characteristics in this partnership, and during the franchisee recruitment process a franchisor will conduct interviews that can identify and assess these aspects. If there is a likelihood that a prospective franchisee could cause problems within the network, the franchisor is likely to reject that candidate, as the relationship with existing franchisees and the health of the network as a whole is a top priority,” he adds.
For more information on franchising visit the bfa website at www.thebfa.org