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Maintaining Strong Franchise Relationships

When it comes to franchises, nothing is more important for success than strong relationships, effective communication, and clearly defined goals. Meeting these conditions allows all stakeholders to perform their roles in the best possible way, contributing to the long-term success of the entire venture. The failure of a single franchise unit can have negative repercussions on the brand across the market, especially if franchise relationships turn out to be weak. In such cases, the overall expansion strategy in a given market may be jeopardized, as there simply won’t be interested franchisees.
So, how do you maintain strong franchise relationships, and what should you pay attention to? Here are a few tips!

Tips for Maintaining a Strong Franchise Relationship

So, in a franchise relationship, there are two main parties – the franchisor and the franchisee. The basic prerequisite for a good relationship is that both parties are as committed as possible to the business they are running and to fulfilling their roles. The franchisor is there to provide all the necessary support and knowledge, while the franchisee must be aware that they are working FOR the franchisor and within the framework of the system the franchisor has established. This is actually one of the main advantages of franchises.

Of course, there should always be a willingness to adapt this relationship to new situations. Conversations aimed at improving the business are always welcome. As long as both parties clearly understand their responsibilities, such interactions can yield excellent results.
In other words, it’s about building and embracing a brand culture, which is essentially a set of beliefs, values, and ethical principles that all parts of the franchise must respect. That’s why it’s important for both parties to be aware of each other’s cultures from the start, so it can be immediately assessed whether these cultures are compatible and where potential issues might arise.

Defining Responsibilities

The foundation of every franchise relationship is the franchise agreement, which must clearly define all relevant business parameters (this also applies to master franchises). Additionally, the franchisor must clearly communicate their expectations and define the responsibilities of each stakeholder. This way, it is possible to monitor whether all parties are fulfilling their obligations.
However, it is not enough to simply put these things on paper. The franchisee needs to be thoroughly prepared for everything they will face, and the most important points should be reiterated multiple times in the discussions leading up to the signing of the agreement. Simply put, the franchisee should be given time to fully understand everything, as this helps prevent misunderstandings that could disrupt business operations.
In fact, it all comes down to the distribution of roles: the franchisor is responsible for providing support and training, while the franchisee is responsible for operating their own franchise location in the best possible way, in accordance with the brand’s standards and reputation.

Maintaining dialogue

In order for a franchisee to succeed and grow within the system, they must have the tools to enable this, and the responsibility for providing them lies with the franchisor. However, it’s not enough to simply provide the tools; the franchisor must also be able to offer full support in using them and clearly communicate the goals that these tools are meant to achieve. In this case as well, clear communication is at the very top of the priority list.
Whether it’s weekly video calls, annual conferences, or regular meetings, communication must be consistent, and through it, the brand should regularly reiterate the tasks and expectations that franchisees need to fulfill.
However, this must by no means be a one-way street. Franchisees must feel free to voice their comments and suggestions to improve the entire organization, and a well-established system should be in place to support this. It is extremely important that both parties approach communication honestly and without reservation, as this is the most effective way to resolve issues.

Achieving Goals

However, no matter how available the franchisor is, they cannot be expected to save every location that simply isn’t performing well. Therefore, the primary responsibility for the success of a franchise unit lies with the franchisees.
Encouraging an entrepreneurial spirit is desirable, but the franchisee must not forget that a franchise is successful precisely because it relies on standardized practices and procedures that have, in most cases, proven effective many times. Any deviation from these standards should be explicitly approved by the franchisor, and major changes in the way a franchise unit operates, made independently, usually cause far more harm than good.
It should also be noted that the franchisor is indirectly responsible for the franchisee’s success, as it is their duty to maintain the quality and integrity of the brand so that franchisees can perform their work effectively. Additionally, franchisees should have a clear understanding of the results they can expect from specific actions and be familiar with best practices across various areas, from marketing to, for example, procurement.

In conclusion

Clear and concise goals and communication are the foundation on which every successful franchise is built. From this, healthy franchise relationships develop, leading to the success of all parties involved.
Perhaps most importantly, it is crucial to clearly define roles and constantly explain to franchisees what is expected of them and how to achieve it. This should start even before signing the franchise agreement so that potential franchisees know exactly what they are getting into. Furthermore, the franchisee must understand that they are part of a larger, well-established system that delivers results, and that any major changes must be approved by the franchisor.
This by no means means that franchisees have no say. On the contrary, they should be provided with a system where they can clearly express their concerns and suggestions and openly communicate with the franchisors. “Field” information can help modify the system and better adapt it to the market, especially if the franchise is expanding into a new market where it is not yet established.
If the franchisor is up to the task, it is then up to the franchisee to apply what they have learned, and their branch will be successful.

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