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To be a former franchisor, and developing franchised my company for over 10 years before I sold it, it seems to me that I’d experienced just about every possible scenario. Most people think 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 operate the business or store for any 10 year term with automatic renewals.
This is a serious issue, and it happens more often than people realize. Franchisors need to demand that the correct procedures are followed, in any other case you run into all sorts of instances. Please consider all this and think on.
One day, I happened to fill in for one of the area representatives in that section, and I went to go to the franchisee on the Georgia part. When I got there, I was talking to his brother-in-law. Apparently he was now running the business, and this franchisee had transferred the business enterprise to him without acceptance.
Worse, the guy wasn’t following the proper techniques which were part of a large fleet account we had with a indigenous company. Again because he didn’t have to follow will be confidential operations manual, which inturn he never read simply because as he said; “I never signed nothing. inches Nor did he truly go to our franchisor teaching, which is also required of new managers which are sprinting our franchised business model, in case the owner is not involved in the day-to-day operations.
That really doesn’t happen with franchising, and although franchising is an extremely successful business structure for distributing goods, solutions, and products; it isn’t Disneyland. I doubt any industry really is.
I explained to him the fact that he had to run the business an unusual way, and he stated that I was wrong, since he didn’t sign any sort of agreement, and he was going to do it his way. Wow great I thought, right now I have a rogue franchisee on my hands, and they are not keeping with the steadiness of our brand name.
You see, in the franchise deal there are stipulations before you switch the business to someone else, the fresh franchisee has to then sign the latest franchise agreement, and they have to be approved by the franchisor. It turned out the brother-in-law was not running the business per our confidential operations instructions, he had made quite a few changes.
Yes, the fact that sounds like a decent business model, then again nothing is ever as straight forward 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 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 of the franchise agreement, and every thing went perfect during the a decade’s they were in business prior to reconstruction.
Let me give you an illustration of this a crazy thing the fact that happened to us. We’d a franchisee who enjoyed on the border of Ga and Alabama. We allowed them to have a joint location in both states. With the type of industry we took part in in there were different rules on each side of the border.
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