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May, 20 2013

Strengthening franchisor-franchisee ties

A strong commitment between franchisor and franchisee forms the bedrock of a franchise relationship. For franchise success the relationship must endure through thick and thin. But what makes the relationship tick? Read on and find out for yourself.

FALLING in love and having a relationship are two different things.”- Keanu Reeves (Actor) And that's because falling in love is easy, but keeping that love alive every single day is tricky! A franchisor-franchisee relationship mirrors personal life in this aspect. It may not be difficult getting into a business agreement, but keeping promises and honouring commitments on a daily basis is challenging. And so there is a need to know how to keep the relationship alive and kicking. Besides love (read as good business proposition for both partners!) and mutual trust, there are many components that make a franchise relationship tick. Commitment When both the parties are truly committed to each other, without a doubt they will work towards a common goal. A franchisor is committed to provide a brand, a system of working and support to that system, to the franchisee. Continual franchisee training programmes, upgrading their knowledge about the brand, providing them the "know-how", “what-to-do”, "what-not-to-do" tips instill confidence in the franchisee and create a better brand connect with them. “We provide complete training to all our franchisees. We also help them find suitable location for their school and decide on the right infrastructure”, says Amol Arora, MD & Vice Chairman, Shemrock & Shemford Group of Schools. Vikas Agarwal, a franchisee with Ferns N Petals (FNP) commends the company for its training and support. “I'd give FNP 9 on 10 for their great technical and design support. Also, they support the franchisees with online orders from their portal.” In return, a franchisor expects the franchisee to be committed to protect the brand. The system of functioning and the guidelines set by him must be honoured and followed by the franchisee. “A franchisee must respect the brand and take utmost care of it. He is expected to protect his market and make payments to vendors on time, to prevent brand dilution", opines Chackochen Mathai, General Manager, Business Development, GreenTrends. Communication & motivation Both franchisor and franchisee need to keep the communication channel open between them. That's the best way to bridge gap between expectations and reality. Be it the technical support that a franchisee may be expecting from a franchisor or a particular way of client-servicing that a franchisor expects franchisee to follow.. Talk! Franchisors should plan weekly, monthly or quarterly meetings with franchisees to ensure relevant information is communicated. In case of numerous franchisees, franchisor can appoint franchise officers or persons in charge of handling various franchisees. Communication is always easy when a franchisee knows “that one person” who can be contacted in case of any problem. Helping franchisees set goals, make plans and develop business strategies go a long way in strengthening the relationship. Assisting them in facing challenging situations, motivating them by sharing success stories of other franchisees and advising them on pertinent problems forge a better rapport between the two parties. “We provide customised support to every franchisee, as per their needs and requirement. If the franchisee is challenged with declining footfall, we would analyse various aspects like manning, servicing, inventory, location and help solve it", says Pawan Gadia, CEO, Retail & Online, Ferns N Petals. Audit A franchisor must keep a tab on the workings of the franchisee. There should be a method in place to gauge the processes employed by the franchisee and know if the standards and procedures set by the franchisor are being followed. This helps not only the franchisor to guard the brand against any dilution but also provides the franchisee with some “on-the-job” corrections and suggestions- a win-win situation for both the partners. Mend the cracks While entering into franchising, both franchisor and franchisee look for a long-term relationship. Most franchisors offer a term of three years to franchisees, after which the contract is renewable. While it guarantees better profits and deeper market penetration for the franchisor, it provides a source of income and stability to the franchisees. But like any relationship, franchisor-franchisee association also has to go through test of time. Problems and issues may crop up once the honeymoon period is over. At times experienced franchisees may view the training and advices coming their way as unnecessary and time consuming. “Any franchisee who doesn't attend training programmes, no matter how old he's in the business, cannot be successful. A franchisor, after much R&D, shares the latest findings, trends, methods to combat competition in such meetings.” says Mathai. At times franchisor may develop a lopsided approach towards profit, giving it more importance as compared to the training needs and problems faced by the franchisee. In such a case, franchisors must not forget that failure of a franchisee, in a way, reflects on the brand as well. So all possible efforts must be made to help the franchisee grow and prosper. Change with changing times Times change, people change, systems change. But values and culture stay the same. Adapting to new situations and adopting the new trends and upgradation are the crucial ingredients needed to keep an association alive. Change with changing times but maintain the core values for a successful franchise.

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