With such a big decision being made by both the franchisor and franchisee during initial negotiations, it’s critical that both sides are clear on what’s being brought to the table.
So what should a great franchise corporation provide to its potential owners?
“A good franchisor will provide a proven business model,” explains Jonathan Young, Senior Manager, Franchising at Recipe Franchising. “The Franchisor should focus on things like national marketing, purchasing, menu development, training, industry trends etc. so that the franchisee can focus on the four walls of their business. If the franchisee can trust the systems and strategies in place they can focus on guest experience, managing/motivating their teams and driving sales.”
The franchisor carries a lot of weight by coming to the table with a well established concept for a restaurant. This can be an undeniable benefit, especially when the franchise has proven success over multiple locations.
Brand recognition is also a huge advantage. Customers are drawn to businesses that are familiar to them. When customers have had a good experience with a brand in the past, they’re more likely to support the same brand, even if in a different location, in the future.
“All franchisees benefit from the goodwill the brand has developed with its loyal customer base.” – Fran Net
In regards to media and marketing, it comes down to economies of scale. In some cases, the franchisor manages a national marketing fund, where all franchisees contribute and the funds can be pooled to purchase media in bulk. This allows brands to build a nationally recognized presence. For example, if you were watching the 2021 Super Bowl, you would have seen the Harvey’s Burger Boss advertisement during the show.
Franchises under the same brand run similarly because they’re rooted in the same business model. A great franchisor should bring a solid business plan—one that includes start-up costs and support—to the table.
There needs to be a clear partnership with clear roles and responsibilities for both sides, especially in the beginning stages. A franchisor should be open and transparent about the details of the Franchise Agreement and any other pertinent aspects to the arrangement so that clear expectations are set from the beginning.
“Buying into a franchise won’t give you immediate profitability, but it does increase the chances of your business becoming successful”. – Fran Net
Franchisors can also assign a manager to service franchisees in specific areas. This manager coaches and assists franchisees to ensure continued profitable operations, and provides a link between the franchisee and the franchisor to handle questions and concerns.
The franchisor is also responsible for continuous R&D for products, systems processes, equipment, store look and feel etc. The franchisor ensures the business is always evolving and keeping up with market demands.
From demographic data to sales statistics to neighbourhood growth, a great franchisor will do the work to ensure a franchise is set up for success with the right staff, equipment, location, building construction, site selection, design, project management, training, and support.
For business owners who launch a brand from the ground up, logistics can be one of the most overwhelming and difficult things to manage. Finding the right suppliers can take time and a lot of work.
When you join a franchise, your supply chain is laid out for you. Franchisees can also benefit from a Franchisor’s economies of scale offered by the power of group buying which results in franchisees likely paying less for supplies than what they would if they were an independent business.
A great franchisor will also provide you with everything you need to know about ordering the right products, on the right schedule, from the right suppliers.
At Recipe, our franchise corporation provides everything you need to get started and succeed. Have questions about franchising? Please fill out our online inquiry form to receive a welcome email from our Franchising Team, which includes our Franchise Application for your review.
Despite the massive challenges that the restaurant community is currently facing, the Recipe Franchising Team would like to extend our message of reassurance. Having been in business for over 137 years, we are confident we can get through this challenging time just like many others in the past. We take pride and ownership in the well being, health and safety of our franchisees, associates and customers. Recipe Franchising is looking towards the future with hope and continuous growth. With the challenges at hand, The Recipe Franchising Team has adopted a new process that we like to call "Frictionless Franchising", a way for you to meet, research, investigate and explore new franchising opportunities with us from the comfort of your home. We want to make sure that we are always here to answer your questions, inquiries, and help anyway we can. Please do not hesitate to contact us.
Stay healthy and stay safe.
The Recipe Franchising Team