Franchisors need to examine the cost benefit relationship of requiring frequent franchisee remittances vs. working capital benefits.
Too often in our practice at MSA Worldwide, clients will present to us a set of facts that their lawyers have determined is a license, but in reality is a franchise.
Field staff perform multiple functions in a franchise system; not only monitoring franchisee compliance, but also contributing to system growth far beyond completing a site visit checklist.
Regardless of the cause, the loss of any single franchisee-owned location should be viewed with concern by the franchisor, and should be analyzed to discover the reason and prevent future failures.
Your goal is to ensure that your franchise system has the ability to consistently and sustainably replicate your brand standards from location to location.
The criteria used in determining franchisability should be appropriate for your industry and business, and will generally fall into these interrelated and interdependent major buckets.
The principal reason many companies choose to franchise is that it allows for expansion without the amount of capital funded by the franchisor that is required under other forms of expansion.
In Part Three of the Threshold Analysis, we’ll cover the different classes of franchisees and how to determine which class or classes you should be focusing on as you conduct your analysis.
For those of us experienced in franchising, we are often amazed when companies considering the establishment of a new franchise system begin the process at the end – the development of the legal agreements.
Here in Part Four, we’ll cover the support system and fees to consider for your franchise system during the Threshold Analysis.
This in-depth article addresses one of the most difficult business and relationship issues for franchisors to manage - the transfer of a franchised location between franchisees.
How to analyze your ability to expand your franchise system in the threshold analysis, including market development strategy and comparing indirect and direct methods of franchise marketing.
Just like any other fee imposed in a franchise agreement, advertising and marketing fees must be structured in a way that balances the franchise system’s need for the funds with the franchisee’s practical bottom line return on investment.
Understanding unit failure is a chance to improve your franchise system, and it’s important for franchisors to understand why each location failed.