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Franchise 18 Jul 2017

Building partnerships: Maintaining franchisee-franchisor relationship

If one is looking for a franchisee relationship with franchisor then one must know his deliverables or what part of business is he going to take care of.

By Charu Sharma Feature Writer

Partnership in True Sense

Running a successful franchisee model requires a successful relationship with Franchisor. It is a model depends upon reliance. There are few things one need to take care of when they enter into franchisee franchisor model i.e., if they want a franchisee franchisor relationship or an owner operator relationship. That is the matter of utmost importance so that franchisor can bring on the table what his partner wants from him. “Today if one is looking for a franchisee relationship with franchisor then one must know his deliverables or what part of business is he going to take care of. It is important to meet commitment levels in this kind of model”, says Nitin Kohli, Sr. General Manager at Ambuja Neotia Hospitality. Also a franchisor has to have belief in the person he is partnering with for one to be able to make a profitable model. It should be a partnership in true sense and not one way partnership.

There are lot of parameters which master franchisee has to understand as well that the brand has established on certain principles, they have their USPs and master franchisee has to respect those. They have been practicing on their products from years to become a brand. Needs, expectations and requirements of both the parties should be established with each other. According to Rohit Malhotra, ‎Business Head at Barcelos Flamed Grilled Chicken, “When a brand has reached to a certain stage, all of their rules and principles have to be followed properly. Franchisee should not try to change the brand the way they want because it brings dilution which results in dropping down customers’ expectation from the brand. Let the brand what they are and don’t try to change them”. The key to success is to maintain reasonable flexibility. If things have been going as planned, the franchisee will learn a lot that has led to a successful opening and operation of the franchised business. On the other hand this phase can also evoke negative traits. For example, the franchisee has not received support materials, accounting aids, marketing suggestions, promotional and advertising support, or other items as regularly as expected. At this time the franchisee might begin to feel that he has signed on with a second-rate franchisor. During this phase multiple things can happen that can lower the expectations of the relationship.

Leverage Co-Branding

Ten years back when McDonald’s & other brands entered Indian market for franchising then they were mostly dependent on supply chains. Once the supply chain is established then it is easier to franchise out. “What are we franchising today is the question, is it verification method, gelling method, foaming method or nitrogen infusion. One is basically franchising different forms of molecular gastronomy today and that is going into franchisee models”, adds Kohli. It is also important to understand that when you’re doing franchising, most of its part depends upon training. “The importance here is on training and SOPs, once one has those in place then it is very easy to leverage different kinds of brand in different retail segments of similar categories in same region”, he adds further. The moment one realises that he has a unique product which is dependent on art and will turn into science; it is easy to leverage those products in newer market. And it is not difficult to get the consumers in because they are going to get something which is much diverged. 

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