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Nov, 07 2014

Franchisor and franchisee: It takes two to tango

The move from being an employee to an entrepreneur can be worrying for many but not for all. Those who know the skill to find the right franchisee for them will never have to worry about their venture.

Today, across the globe franchising is a fast growing industry and to let the magic of a new venture work, you have to find the best and competent match for yourself. Keep reading to know more about the tactics of pairing off with the best franchisee match for your business.

Let's assume you have a business that is doing wonderfully well in terms of trade and now you want to expand it in the local markets too. Here, first thing that comes to your mind is finding the right franchisee who matches up to your expectations. Finding the right match can be equally tedious and also at times very easy for a business venture. It is all about understanding your needs. Few players go for moving traits like honesty, hard working nature etc. while others go for business background, years of experience in the same industry, hold on the local market etc. While finding the right franchisee, your precedence may differ but experts say that a good franchisee match is a perfect blend of emotional qualities as well as credentials.

Is he the right match?

Before finalising any franchisee/ partner, make sure he has a similar personality like you. Think twice, is he like you? Suppose you like interacting via e-mails, letters, face to face conversations with the subordinates whereas he prefers handing over the communication part just to the subordinates then he is definitely not the right one for you. You might be looking out for someone more responsible. Another example can be of visiting the stores. You always visit the stores at least once or twice a month for customary checkups whereas the franchisee you wish to join hands with is a little easygoing in this aspect and takes it as a task to be done over the phone call then you should rethink on your decision and hold on to someone who is a better match. To find a right partner, not just akin nature is required but more important is a wise decision making personality too. Hemal Panchamia, Head of Marketing, Fastrack says: “At Fastrack, we look for a franchisee who can relate to youth and fashion, which is essentially what Fastrack is all about. Our current set of franchisees are extremely passionate about the brand, and they showcase an undying hunger to experiment. It is important to us that our franchisees believe in both, hiring and retaining good staff with luring incentives. Also, we insist that they prioritise the needs of the brand more than RoI and cost implications.” Di Bella coffee recently experienced a transition phase in India. The well known coffee brand is fast and up with its franchise operations in India. Rahul Leekha, Director, Di Bella Coffee India says: “We start with having our franchisees fill out an expression of interest form which helps us understand their meaning of the franchise arrangement. We totally understand that a wrong franchisee can quickly lead to brand dilution. We look for entrepreneurial traits, previous ventures (If any) and future ambitions.”

The financial aspect

The franchisee/partner must be financially strong to handle the sudden occurrences in the business. You must select a franchisee with a strong backup for days of emergency. In case you are finalising the contract with a prospective investor who was earlier an employee for an organisation, make sure you know all about his reserves and how much he is willing to invest in the venture.  Nissan Joseph, General Manager, Crocs India points out: “India is an extremely diverse country both in its traditions, tastes and local laws. We look for franchisees that have demonstrated the ability to both operate in their respective environments while still maintaining the brands value proposition to the local consumers. Retail is also a capital intensive proposition from a Cap-Ex and Inventory standpoint and consequently we also need assurance that a franchisee has the resources to invest in the business. So in a nutshell, we are looking for a proven local expertise that can support brands initiatives and have the resources to grow the business.”

Kunal Mehta, Vice President, Marketing and Business Development, Being Human Clothing opines: “Being Human Clothing franchise model operates on product distribution, management franchising and business format of one model- Franchisee-owned Franchisee operated. In terms of business strategy we do catchment area analysis, store feasibility study, zone wise mapping and competitor analysis.”

Devotion and time

It is equally important to join hands with a franchisee who knows in advance that new ventures require a lot of time, energy and devotion.  A franchisee that you choose, must know the pros and cons of getting into the business. He must know that starting days require more time at work and there will be less family time. Is his family supportive to the new venture? Best franchisee match can be the one who knows these minuscule details in advance and embarks upon them smartly.

Hire good employees

Franchisees can't succeed without good employees. A franchisee can be successful only when he trains his employees and subordinate well so that they treat the customers in the same manner. A franchisee must hire and train the employees well for a shining business venture. Location can be another big matter of discussion while finalising a franchisee. On the location aspects Mehta of Being Human adds: “Franchise model can give any business a deep network within non-metro cities, which are among the most promising markets. Selecting the best site for a new store depends on more than just location. You also need to understand how performance of your existing sites will impact your proposed sites, and determine the demographic makeup and spending habits of consumers in that area.”


Sectors                         What to look for in a right match

Food & Beverage     Must have basic knowledge of food, storage and right mix

Education                    Must be a specialist in specific education domain- like Preschool, day care, K-12 etc

Beauty                          Should have knowledge of latest beauty trends and fashions

Health                           Should himself be a health enthusiast with basic knowledge of health equipments

Healthcare                  Must have information on advancements in healthcare and technology

Mobile services        Must be passionate and know about competition and schemes









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