Like a former franchisor, and developing franchised my company meant for over 10 years before We sold it, it seems for me that I’d experienced just about every possible scenario. Most people feel that franchising is really cut and dry; you have a franchise 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 with automatic renewals.
That really doesn’t happen in franchising, and although franchising is an extremely successful business design for distributing goods, assistance, and products; it isn’t Disneyland. I doubt any online business really is.
I explained to him which usually he had to run the business a particular way, and he stated that I was wrong, because he didn’t sign any kind of agreement, and he was going to do it his way. Wow great I thought, today I have a rogue franchisee on my hands, and maybe they are not keeping with the uniformity of our brand name.
Yes, that sounds like a decent business model, then again nothing is ever as straightforward as it appears in the franchising industry. Let me explain. Progressively, I don’t think I ever had a perfect franchise sale where by everything went exactly perfectly; where the franchisee qualified meant for the loans very quickly, experienced a perfect resume, had a wonderful location, didn’t care to make sure you negotiate any terms in the franchise agreement, and almost everything went perfect during the a decade’s they were in business prior to reconstruction.
Worse, the person wasn’t following the proper techniques which were part of a large navy account we had with a national company. Again because this individual didn’t have to follow will be confidential operations manual, which he never read considering as he said; “I never signed nothing. ” Nor did he ever go to our franchisor training, which is also required of new managers which are functioning our franchised business model, if ever the owner is not involved in the day-to-day operations.
One day, I occured to fill in for one our area representatives in that vicinity, and I went to visit the franchisee on the Georgia area. When I got there, I was talking to his brother-in-law. Apparently he was right now running the business, and our franchisee had transferred this company to him without endorsement.
This is a serious concern, and it happens again than people realize. Franchisors need to demand that the proper procedures are followed, otherwise you run into all sorts of circumstances. Please consider all this and think on.
You see, in the franchise arrangement there are stipulations before you copy the business to someone else, the fresh franchisee has to then indicator 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 much like our confidential operations information, he had made quite a few changes.
Let me give you an illustration of this a crazy thing that happened to us. We’d a franchisee who been around on the border of Georgia and Alabama. We allowed them to have a joint location in both states. With the type of industry we took part in there were different rules on each side of the border.