One of the main reasons that people decide to buy a franchise is the ongoing franchisor support that they receive. In fact, this is often a key point when deciding between becoming a franchisee, or starting a new independent business. Many people will conclude that their ability to benefit from a franchisor’s systems and support increases the likelihood of their success.
If you have decided that franchising makes sense, you have likely determined that you could be more successful by paying for the right to use the franchisor’s brand, standards, and operational knowledge. In addition, a strong franchisor can often provide expertise in specific business functions, such as marketing or finance, that you may not have.
However, it’s important to recognize that:
- The level of franchisor support can vary.
- Franchisor support will be clearly defined in the Franchise Disclosure Document and Franchise Agreement.
- You need to do your own due diligence and research to understand what support you’ll receive.
To find out more information about the type of franchisor support that you can expect, review what they outline in the Financial Disclosure Document.
Forms of Franchisor Support
Let’s explore four common areas of franchisor support:
1. Initial Training:
When you select a respected franchisor who provides training in the initial stage to help you master the basics, you can expect to do very well.
Your initial training should provide you with a broad overview of operations, marketing, sales, service, and general management. This may include:
- Operations training to develop skills and knowledge to run your franchise
- Financial and business systems training
- Employee selection and retention training (if applicable)
- Operations manuals and standard operating procedures
Your training should begin after you sign your Franchise Agreement, and continue for as long as you own the franchise. Your franchisor wants you to succeed, and that means providing you with tools, resources, and knowledge right from the start.
2. Marketing and Advertising Support:
All franchisees are required to pay an Advertising Fee (usually 1 – 4% of gross sales). This fee is managed by the franchisor and it means that you do not have to create your own advertising plan or marketing materials. In return for this fee, you can expect to receive:
- A marketing plan that extends past the grand opening of your franchise
- Tools to support brand building and promotional campaigns
- Guidance in local and regional marketing activities
- Professional marketing materials such as posters, brochures, banners, and other items.
3. Site Selection:
Not all franchisors will assist with site selection and site location is critical to your business success. If your franchisor doesn’t provide a great deal of site selection support, you can usually get guidance on preferred business square footage, parking requirements, and other information.
Be sure to clarify what level of site selection support you can expect. Be sure to read what you can expect in the Franchise Agreement and discuss how you can work with the franchisor to select a site.
4. Ongoing Support:
After you have completed your initial training, the ongoing support that you receive is essential. This support is generally provided by the franchisor to:
- Help you to improve the performance of your franchise
- Ensure you’re operating your business to brand standards
- Help you to grow your business
Other ongoing support can be related to: supply chain; management training; and new products and services. This support can be a huge benefit. Your franchise team is likely working with other franchisees who have dealt with similar issues that you will face so, this knowledge may help you to reduce, if not avoid mistakes.
Franchisor support can be a large benefit and a critical factor in your success. You may even make your franchise selection decision based on the support you’ll receive to start your business on the right foot. The ultimate goal is your franchise success and the ability to benefit from the franchisor’s proven systems and support.
Visit our Franchising Opportunities page to view additional tools and resources.
