Like a former franchisor, and having franchised my company for over 10 years before I actually sold it, it seems for me that I’d experienced concerning possible scenario. Most people believe franchising is really cut and dry; you have a team agreement, people pay you will a certain amount to purchase their franchised outlet, and then they operate the business or store for a 10 year term by means of automatic renewals.
Yes, which usually sounds like a decent business model, then again nothing is ever as straight forward as it appears in the franchising industry. Let me explain. Progressively, I don’t think I ever endured a perfect franchise sale where by everything went exactly properly; where the franchisee qualified designed for the loans very quickly, previously had a perfect resume, had a wonderful location, didn’t care to negotiate any terms with the franchise agreement, and all sorts of things went perfect during the decade they were in business prior to reconstruction.
One day, I appeared to fill in for one your area representatives in that section, and I went to go to the franchisee on the Georgia area. When I got there, I was talking to his brother-in-law. Apparently he was today running the business, and some of our franchisee had transferred the business enterprise to him without authorization.
You see, in the franchise agreement there are stipulations before you transfer the business to someone else, the popular franchisee has to then signal the latest franchise agreement, plus they have to be approved by the franchisor. It turned out the brother-in-law was not running the business much like our confidential operations guidebook, he had made quite a few adjustments.
This is a serious issue, and it happens more often than people realize. Franchisors need to demand that the appropriate procedures are followed, in any other case you run into all sorts of instances. Please consider all this and think on.
That really doesn’t happen with franchising, and although franchising is an extremely successful feature for distributing goods, assistance, and products; it isn’t Disneyland. I doubt any online business really is.
Worse, this individual wasn’t following the proper measures which were part of a large navy account we had with a indigenous company. Again because he didn’t have to follow happen to be confidential operations manual, of which he never read because as he said; “I never signed nothing. inch Nor did he ever go to our franchisor workout, which is also required of new managers which are going our franchised business model, if ever the owner is not involved in the day-to-day operations.
I explained to him who he had to run the business an unusual way, and he said that I was wrong, simply because he didn’t sign any kind of agreement, and he was going to do it his way. Oh yeah great I thought, today I have a rogue franchisee on my hands, and they’re not keeping with the steadiness of our brand name.
Let me give you a good example of a crazy thing that happened to us. There were a franchisee who enjoyed on the border of Atlanta and Alabama. We allowed them to have a joint territory in both states. As a result of type of industry we took part in in there were different rules on each side with the border.