Franchisees determine SUCCESS

TODAY is the age of the empowered franchisees who have their say in the business. Taking a franchise and running the business the way it is, will no longer be the driving factor for the new age entrepreneur. As he makes his way ahead, he brings out opinion, about the business and makes sure that his voice gets heard.

Dealing everyday with his customers a franchisee truly understands the needs of the customers and makes every possible way to make the necessary changes. This is the major role a franchisee can play in any business. He gets close and personal with the customers and assesses their needs and requirements so as to increase the popularity of the brand. A powerful image of a brand gets built on the shoulders of its franchisees who act as the face of the brand amongst the buyers. The responsibility of popularising the brand, once it has made an effort to reach the masses comes on the shoulders of the franchisees as they are the partners in business. Whether it is Subway's Indianised menu or its marketing budget, franchisees have played a major role in getting it all fine tuned as per the need of the market they serve.

Areas of suggestion

Though the area of involvement of a franchisee is in the overall business where he should make every effort to improve it, certain business processes are to be followed in the franchise business.

Franchising is a business model where you have a set business model of functioning. Certain rules like the style of the outlet and its overall look are some of the areas where the franchisor has a set pattern to be followed.

At a franchise outlet there are basic principles followed by everyone - like the layout of the outlet, operations, maintenance of a store that are standardized and applicable to all franchisees across the country. However, a certain degree of independence is allowed to franchisees to have their say in the business.

Giving a franchisor's point of view, Pattabhi Rama Rao, President, Cookieman India, says, "Every organisation has a set of rules and regulations, similarly every franchisee must follow the guiding principles of the franchisor. This is to ensure a uniform experience for customers no matter which franchise outlet they are visiting."

Cookieman encourages its franchisees to be creative in local marketing and promotional initiatives and day-to-day store management. They have a regular feedback mechanism that enables franchisees to share their valuable inputs on a regular basis and relevant feedback is integrated into the company's strategy.

Explaining the point further, Ajay Bansal, CEO, Satyam Cineplexes, and an expert in retail and service industry says, "Big brands thrive on one quality - they have consistent offering across their outlets irrespective of their location. When they want their franchisees to operate within the standard parameters, the purpose is to ensure that franchisee benefits from all the learning of the franchisor and provides a consistent offering to the consumers."

Talking further about areas where a franchisee's suggestions are welcome, he says, "The franchisee is always free to add value to the system by making suggestions on products, methodology, supply chain system etc. The only difference is that a franchisee can implement such changes only when they are approved by the franchisor and such approval should be forthcoming if the suggestions are valid and would contribute to the growth of the brand."

Finding a product which works in the market is quite tricky and this is where a franchisee's regional know-how and market knowledge comes in handy. There are other areas also where a franchisee's suggestion proves valuable to the company.

Cookieman's Mumbai franchisee, Rajat Mathur, who is an IIT graduate came up with a suggestion for creating a corporate brochure that can be used as a sales tool to lure in bulk orders from the corporate world. Acting timely on this suggestion Cookieman has brought in new clients like Sungard, Cognizant technologies, Computer associates, Amway, Comesum, Radio Mirchi etc from across India.

There are many others who give valuable suggestions for the success of a proven system. Talking about his experience, Robby Gulri, ADM India, Subway, explains, "When we came to India we had an international menu on the cards. Our franchisees made suggestions that there should be some Indian sandwiches. So we incorporated six different varieties of Indian sandwiches."

Franchisee is business partner, not employee

Franchising is a proven set of business model where the franchisee is to follow the set path. Does anyone hear entrepreneurship not getting its due in the business where you can not have your say. Not anymore, as we show the right picture.

Given such a situation, where the franchisee has to follow the guided path of the franchisor in a franchise business, it in no way hampers the entrepreneurial growth of a franchisee.

Talking about the entrepreneurial growth a franchisee can get in a franchise business, Rao says, "Franchising is a great way for a would-be entrepreneur to test the waters and determine his ability to run a successful enterprise of his own. Entrepreneurial growth in franchising relationship largely rests with the franchisee's abilities."

To this Bansal adds, "One of the reasons why brands franchise their concepts is to leverage on franchisee's local knowledge. In an ideal franchise environment, franchisees and franchisors are constantly interacting and leveraging on each other's strengths to grow the business. While the franchisor brings all his experience and knowledge of the brand on the table, the franchisee contributes through his understanding of local environment."

Ways to put your point across

A franchisor and a franchisee should organise formal meetings to discuss, listen and understand each other. Franchisor-franchisee relationship can become a healthy one if both parties put their points across and understand each-other.

Companies like Cookieman India interact with franchisees on a daily basis at various levels. In addition to the day-to-day interaction, they have scheduled a programme for strategy discussions and meetings.

Ferns 'n' Petals, another company leveraging on franchise business, ensures that the franchise manager meets the franchisees on a regular basis. The company also hold annually a franchisee meet in Delhi, where franchisee come over from all over the country. In this two-day summit, franchisees discuss, their problems, improve on them, which will help to improve the trade. They are free to share with them all the new innovations.

Talking about Subway's interaction with its franchisees, Gulri says, "We have monthly meetings with our franchisees. Moreover, if a franchisee wants to come everyday for help, we are at their disposition." He adds "We do incorporate suggestions by franchisees but they have to be approved by the Subway headquarters." Vikaas Gutgutia, Founder, Ferns n Petals, says, "We welcome suggestion from anybody as the franchisee is a part of the family."

The international market

The biggest franchisor, McDonald's relies on its franchisees to add new products to its offerings. Whether it is the Big Mac, the Egg McMuffin or any other favourite, they are all invented by restaurant owners.

In the international market, there are forums of franchisees where they regularly interact with each other, discuss about their problems with a strong community to put their point across. To have the privilege of expressing their views more significantly, many franchisees get registered as active members of franchise associations which are easily available today.

Bansal says, "Most of the path breaking innovations for big brands has actually come from franchisees. If the suggestions are valid and will add to the system, they should be accepted. Going a step further, the franchisor should actually share best practices across the other franchisees so that the whole system and brand can benefit from the same."

Understanding the power a franchisee has, Rao says, "A franchisee is integral to the success of a franchising business as it is he who is the face of the brand in each regional market. A franchisee is an independent contributor to the company's accomplishment besides being a key participant. Their involvement, passion and focus are what drive the growth and success of a franchised brand."

Saluting the power of franchisees Gulri adds, "The quality of the franchisee determines the success of a company."

Annotation

In India, proactive participation is required from the franchisees to take the business to the next level and an acceptance by the franchisor to make changes for improvising the business and giving credit to the franchisee.

Therefore, it is important that when franchisees make a suggestion it should not be ignored as there might be a wonderful opportunity to improve the business. While keeping the business model intact, a little change here and there will only lead to more profits.

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