EntrepreneurshipBusiness

A franchisor’s responsibilities

If you are planning on expanding your business into a franchise and recruiting franchisees, there are certain responsibilities as a franchisor that you will have to meet in order to successfully and efficiently expand your franchise business.

There are many positives to expanding your franchise and becoming a business franchisor. As a franchisor, you learn to create and maintain relationships with franchisees. This relationship management is critical as the better your relationship is with your franchisees the more successful your franchise business will become.

The more franchisees you have the more your market reach will expand. Your brand awareness and loyalty will also increase, as will your revenue.

Building a franchise, however, can be a tricky business and it is always a good idea to seek legal or professional advice if you are unsure of what to do. These professionals can be easily found through franchise associations such as the Franchise Council of Australia.
If you would like some quick advice or find a specific franchise professional, industry-specific online directories such as FranchiseBusiness.com.au are great places to find what you are looking for.

However, it is important that before you decide to create your business into a franchise, you understand the basic responsibilities of a franchisor. It should be in your best interest to have successful franchisees and understand what types of products, services, and support they will need in order to make their business successful.

Territorial protection

This is an important responsibility especially as your franchisee numbers grow. It is crucial for the success, as well as the happiness, of your franchisee that you create territorial borders. This is so no new franchisee can penetrate the existing franchisees’ market and diminish their customer numbers through unnecessary competition.

Promotional materials

As the business owner, it is your responsibility to make sure all franchisees have access to promotional products. This includes, but is not limited to: posters, flyers, brochures, competition entry forms, loyalty cards, and promotional giveaways such as badges or ‘buy one get one free coupon.

This is so your franchisees offer the same promotions and discounts regardless of where they are. Of course, it is always great to put a spin on the marketing products to suit their environment but making sure your franchisees are always offering the same thing is very important for the customer.

Product Management

Making sure that you keep track of what supplies are going where and what each franchise is ordering is important, as waste and expenses must be monitored and kept to the very minimum in order for the franchise to run efficiently.

It is also important to maintain the standard of the product among all your franchisees. Selling quality products in one location and less quality in another is not ok and can ruin the reputation of your franchise. Customers expect each franchise to be the same and provide the same service and quality regardless of where they are located.

Support and training

It is important that you maintain a high level of support and training for each franchisee as not all will have experience in running a business. Additionally, there may be some aspects that need support from other people, such as financial support or legal support. It’s a good idea to have a network of trusted professionals around you that your franchisees can also use.

Also, it is important that you train your franchisees either externally or on-site, and that you provide them with a training manual. Be sure to train all franchisees the same way so as to promote the same values, beliefs, and professional service within each location.

Consistency is the most important aspect of running a franchise business and it is the franchisor who is responsible for maintaining consistency through everything in the business. It is important that, before you begin your franchise business, you understand and prepare for the responsibilities of being a business franchisor.

Raffael Fernandes is the sales manager at FranchiseBusiness.com.au, the official online business directory of the Franchise Council of Australia.

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