Like a former franchisor, and developing franchised my company designed for over 10 years before I just sold it, it seems for me that I’d experienced in relation to possible scenario. Most people feel that franchising is really cut and dry; you have a business agreement, people pay most people a certain amount to purchase their franchised outlet, and then they run the business or store for any 10 year term with automatic renewals.
One day, I happened to fill in for one your area representatives in that section, and I went to visit the franchisee on the Georgia aspect. When I got there, I actually was talking to his brother-in-law. Apparently he was today running the business, and some of our franchisee had transferred the business to him without acceptance.
Let me give you an example of a crazy thing the fact that happened to us. We a franchisee who lived on the border of Ga and Alabama. We allowed them to have a joint location in both states. As a result of type of industry we was in there were different rules on each side in the border.
You see, in the franchise deal there are stipulations before you switch the business to someone else, the new franchisee has to then indicator the latest franchise agreement, and have to be approved by the franchisor. It turned out the brother-in-law was not running the business much like our confidential operations manual, he had made quite a few shifts.
This is a serious concern, and it happens more often than people realize. Franchisors need to demand that the correct procedures are followed, also you run into all sorts of circumstances. Please consider all this and think on.
That really doesn’t happen during franchising, and although franchising is an extremely successful business structure for distributing goods, offerings, and products; it isn’t Disneyland. I doubt any online business really is.
Yes, who sounds like a decent business model, however nothing is ever as straight forward as it appears in the franchising industry. Let me explain. Through the years, I don’t think I ever had a perfect franchise sale when everything went exactly perfectly; where the franchisee qualified to get the loans very quickly, had a perfect resume, had a superb location, didn’t care to make sure you negotiate any terms of the franchise agreement, and every thing went perfect during the 10 years they were in business prior to repair.
Worse, he wasn’t following the proper techniques which were part of a large navy account we had with a national company. Again because the guy didn’t have to follow happen to be confidential operations manual, which he never read because as he said; “I never signed nothing. ” Nor did he ever go to our franchisor training, which is also required in new managers which are going our franchised business model, in case the owner is not involved in the day-to-day operations.
I explained to him the fact that he had to run the business a clear way, and he stated that I was wrong, simply because he didn’t sign whatever agreement, and he would do it his way. Wow great I thought, today I have a rogue franchisee on my hands, plus they are not keeping with the consistency of our brand name.