FIVE HABITS OF HIGHLY SUCCESSFUL FRANCHISORS
US law firm Faegre & Benson has suggested what it is that marks out great franchisors
Last year, top US law firm Faegre & Benson held a day-long summit devoted to best practices in franchising which attracted over 100 participants. The discussions were based on what the company has identified as Five Habits of the Highly Successful Franchisor. According to this, the successful franchisor:
1. Maintains an undying devotion to the brand;
2. Is keenly aware of the competing interests among the franchisor, franchisee and system as a whole - and balances them properly;
3. Stacks the deck with 'ace' franchisees;
4. Is obsessed with the franchisee's bottom line;
5. Empowers its franchisees.
The whole day's discussions can be downloaded and include some fascinating insights of value to franchisors everywhere.
One aspect of franchising in the US that will be unfamiliar to franchisors here is the concept of a ‘renewal season.' This refers to the need for all franchisors to update their legally-required disclosure documents on an annual basis with the latest information in some 23 different categories. Previously, these documents were known as Uniform Franchise Offering Circulars (UFOC) but since last year they have been called by the rather more comprehensible title of Franchise Disclosure Documents (FDD).
While we have no legal requirement for such updates here in New Zealand (except as required by the Franchise Association for its members), franchisors do need to keep all their documentation up to date to avoid potential problems. Faegre & Benson also publish a helpful checklist of Tips to Help Franchisors Prepare for Renewal. It's worth a look.
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