To be a former franchisor, and developing franchised my company meant for over 10 years before I sold it, it seems for me that I’d experienced concerning possible scenario. Most people reckon that franchising is really cut and dry; you have a business agreement, people pay most people a certain amount to purchase their franchised outlet, and then they run the business or store to get a 10 year term by means of automatic renewals.
I explained to him which usually he had to run the business a particular 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. Oh great I thought, today I have a rogue franchisee on my hands, and maybe they are not keeping with the consistency of our brand name.
Worse, this individual wasn’t following the proper measures which were part of a large fleet account we had with a indigenous company. Again because this individual didn’t have to follow are confidential operations manual, which inturn he never read since as he said; “I never signed nothing. inch Nor did he at any time go to our franchisor teaching, which is also required from new managers which are sprinting our franchised business model, in case the owner is not involved in the day-to-day operations.
This is a serious concern, and it happens usually than people realize. Franchisors need to demand that the appropriate procedures are followed, in any other case you run into all sorts of circumstances. Please consider all this and think on.
That really doesn’t happen for franchising, and although franchising is an extremely successful business structure for distributing goods, offerings, and products; it isn’t Disneyland. I doubt any industry really is.
Let me give you an example of a crazy thing the fact that happened to us. We’d a franchisee who lived on the border of Atlanta and Alabama. We allowed them to have a joint property in both states. As a result of type of industry we participated in there were different regulations on each side of the border.
Yes, who sounds like a decent business model, nonetheless nothing is ever as straight forward as it appears in the franchising industry. Let me explain. Over time, I don’t think I ever endured a perfect franchise sale the place everything went exactly appropriately; where the franchisee qualified designed for the loans very quickly, possessed a perfect resume, had a wonderful location, didn’t care to make sure you negotiate any terms with the franchise agreement, and every thing went perfect during the several years they were in business prior to vitality.
You see, in the franchise agreement there are stipulations before you copy the business to someone else, the brand new franchisee has to then sign the latest franchise agreement, and in addition they have to be approved by the franchisor. It turned out the brother-in-law was not running the business down to our confidential operations guidebook, he had made quite a few changes.
One day, I materialized to fill in for one of our area representatives in that region, and I went to go to the franchisee on the Georgia part. When I got there, I just was talking to his brother-in-law. Apparently he was right now running the business, and our franchisee had transferred the market to him without agreement.
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