As a former franchisor, and developing franchised my company meant for over 10 years before I actually sold it, it seems opinion that I’d experienced you can find possible scenario. Most people feel that franchising is really cut and dry; you have a business agreement, people pay you will a certain amount to purchase their franchised outlet, and then they use the business or store for any 10 year term by means of automatic renewals.
That really doesn’t happen during franchising, and although franchising is an extremely successful business model for distributing goods, assistance, and products; it isn’t Disneyland. I doubt any business really is.
One day, I appeared to fill in for one your area representatives in that section, and I went to visit the franchisee on the Georgia side. When I got there, We were talking to his brother-in-law. Apparently he was right now running the business, and some of our franchisee had transferred this company to him without agreement.
I explained to him who he had to run the business a clear way, and he talked about that I was wrong, since he didn’t sign any sort of agreement, and he would do it his way. Also great I thought, right now I have a rogue franchisee on my hands, and they are not keeping with the regularity of our brand name.
Yes, which usually sounds like a decent business model, nevertheless nothing is ever as straightforward as it appears in the franchising industry. Let me explain. Through the years, I don’t think I ever endured a perfect franchise sale where by everything went exactly properly; where the franchisee qualified designed for the loans very quickly, previously had a perfect resume, had a wonderful location, didn’t care to help you negotiate any terms with the franchise agreement, and everything went perfect during the decade they were in business prior to vitality.
This is a serious issue, and it happens usually than people realize. Franchisors need to demand that the proper procedures are followed, usually you run into all sorts of circumstances. Please consider all this and think on.
Worse, this individual wasn’t following the proper techniques which were part of a large fast account we had with a national company. Again because the person didn’t have to follow are confidential operations manual, which inturn he never read simply because as he said; «I never signed nothing. inches Nor did he ever before go to our franchisor teaching, which is also required of new managers which are running our franchised business model, if the owner is not involved in the day-to-day operations.
Let me give you a good example of a crazy thing which usually happened to us. There were a franchisee who been around on the border of Atlanta and Alabama. We allowed them to have a joint territory in both states. With the type of industry we was in there were different rules and regulations on each side with the border.
You see, in the franchise deal there are stipulations before you copy the business to someone else, the brand new franchisee has to then hint the latest franchise agreement, plus they have to be approved by the franchisor. It turned out the brother-in-law was not running the business per our confidential operations guidebook, he had made quite a few shifts.