The Kind of Support You Can Expect From a Franchisor
The support that franchisors provide franchisees varies. Generally, the level of support depends on the industry, the size of the franchisor, the parent company’s financial capabilities, the culture of the franchise system, and the classes of franchises offered by the franchisor. Support is limited to whatever terms the contract specifies. A franchisor is only obligated to provide support and services underlined in their development and franchise agreements.
After reviewing a franchise agreement, you may want—or be prompted by your legal advisors—to negotiate changes. Franchise agreements are generally well written, however, so opportunities to impose changes on the terms are usually limited. Before you sign any franchise agreement, it’s essential to read it and make sure you understand what support you will be provided. Likewise, it’s also wise to speak to other franchisees to find out how supportive the franchisor is in their experience.
As a rule, you should never expect to receive more support than what is contained in the written agreements. While franchise support varies from company to company and contract to contract, in most franchise systems, there are some common things you can expect from franchisors as part of their agreement.
Site Selection and Development
Choosing a location is one of the most important elements for the success of your business. Most franchisors will share their location preferences and will often request info on the associated costs of the sites you’re considering before they give their approval. From there, you’ll be expected to develop your location to meet the requirements and the standards of the franchisor, including layout, décor, signage, furniture, fixtures, and equipment.
After the site plan is approved, it will be your responsibility to build out the location to the franchisor's standards and to meet local building codes. Generally, the franchisor will provide you with a list of sources for the equipment, décor, and other items you will need to purchase, and often, the sources of that material will be limited. Before you open your business, you will generally need the franchisor’s approval that the development of your location meets their standards.
The duration and details of the training will likely be included in the disclosure document the franchisor will provide to you before you sign your franchise agreement. Franchise training generally includes both classroom and on-the-job learning. While most franchisors conduct initial training at their headquarters, frequently, they may have alternative training facilities. Frequently the franchisor will also send members of its staff to help train employees and assist in the opening of the location.
Increasingly, franchisors are also providing pre-training modules hosted on their Intranet, or they require franchisees to complete classes and certifications conducted by third parties. While the cost of training is generally included in your franchise fee, it will generally be your responsibility to pay for all travel, hotels, food, and other costs for you and your management and staff while attending training.
Training the Trainer
It will be a major benefit to you if the franchisor allows you to bring members of your management and key employees to initial training, and most franchisors will allow you to do so. However, as with all other levels of support, it is important for you to confirm in advance who you will be allowed to bring to training.
One area of growing importance is how the franchisor provides you with training on how to continually provide training to your staff. If you plan on having one of your management staff act as the trainer for your staff, and your franchise agreement does not provide for a train-the-trainer program, you should request that your franchisor provides that training to your management team.
Remember, most franchisors understand the importance of your being trained, and will be looking to see if you are taking training seriously. This is such an important issue for most franchisors that your franchise agreement will likely allow the franchisor to terminate the relationship if you do not complete training to their satisfaction.
Meeting the Brand’s Standards
Franchisees are independent businesspersons operating under a license that requires them to meet the franchisor's standards. As such, you will be required to operate your business to meet the brand standards, procedures, and requirements contained in the franchise system’s operating manuals and other brand-standard information. With the exception of adhering to brand standard requisites like dress code, hair color, tattoos, piercing, language, etc., there will generally be no human resource requirements imposed on your business by the franchisor,
The Role of the Franchisor's Field Support Consultant
Most franchise systems will provide a field support consultant, whose role is generally to help franchisees improve the performance of their business and also ensure that they are operating their business according to brand standards. Your field consultant is not your supervisor, nor are they the supervisor of your staff. They are your main source of support from the franchisor, and you should take the time to meet with them in person and not simply have them meet with your management team.
In other areas, including supply chain, marketing support, replacement management training, new products, and services, etc., the franchisor will generally provide that support from their headquarters staff. More and more franchisors are including in their support system an Intranet where you will also be able to communicate with other franchisees in the system, to get advice and guidance directly from your fellow franchisees.
Most franchisors will have regional or system meetings and conventions. In addition to allowing you to meet directly with the franchise system’s management and staff and other franchisees and vendors, these are generally one of the most important venues for the franchisor to convey new information and training. It’s highly beneficial to take advantage of these regional and system meetings when they are offered.
Marketing and Advertising
You can generally expect market introduction assistance and grand opening guidance from the franchisor in the type of marketing and advertising you should use when you first open your business. During the term of your franchise, you will likely be required to advertise locally or to collectively advertise with other franchisees and company-owned locations in your market area.
Most franchisors will also require you to contribute to a system advertising or brand fund that will be used to support the marketing programs for the system. The minimum amount you will be required to invest in marketing and advertising will be specified in your disclosure document and agreement.
While you are operating an independent business, you are doing so while sharing a brand with the franchisor and other franchisees. Because of that, how you advertise is important to the franchisor and the other franchisees. Generally, this means you are not free to develop and use advertising or marketing materials that have not been reviewed and approved by the franchisor in advance. Most franchise systems will provide a method for you to submit marketing materials you independently produce for their approval.