Managing a franchise involves balancing relationships while not overstepping in the day-to-day operation of the franchise. Too little discipline and the situation may become chaotic. On the other hand, too much discipline may drain enthusiasm and creativity from the network, and lead to fewer people wanting to join in.

Studies of the industry have shown that the quality and intensity of the initial training of franchisees is one of the most significant factors that determine the success of a franchise network. Don’t overlook the quality of the initial training. You will never have a more enthusiastic and receptive franchisee than when they first join the network.

Tips on How to Ensure Quality Training
  • Get feedback from your employees and those that have undergone the initial training — continually improve your systems based on their feedback.
  • Hire an external consultant to review your training programs
  • Remember the adage – “train hard, fight easy”.  In other words, the quality of the initial training is crucial to arming your franchisees with the tools to succeed. If they feel lost in the first few months, this drop in confidence could affect them for a long time.
  • Develop a mentor program where good franchisees are allocated to new franchisees, and new franchisees know that they can contact their “mentor” over any issue in the first few months. Often franchisees are reluctant to contact the franchisor for fear of looking bad.
  • Make sure the training materials are available online or in written form. Often franchisees can be overwhelmed and need to refer to material when they operate the business on their own. Do not assume merely because you have shown them how to do something that they can do it themselves. Photos and videos in training programs and the operations manual can greatly assist a franchisee understanding what is required regarding presentation or systems and processes.

How Often Should I Contact My Franchisees?

After you have recruited and trained franchisees, regular contact is important both to encourage the franchisee and continue monitoring their performance. Some franchisees will need more ongoing support and guidance than others. It is important to provide this support for the long term benefit of the network. This does not necessarily require a long on-site visit, but it does require more than an occasional invoice or email.

Should I Finance a Franchise?

It is critical to maintain high and consistent standards throughout the network. Franchisees are very suspicious of any difference in treatment from one franchisee to another, so granting substantial concessions or favours to one franchisee and not another is never recommended. For this reason, we caution against franchisors being involved in minority ownership of franchisees or financing of franchises. If the franchisee needs funds to start their operations, they should apply to their bank manager, not to you.

***

Do you have a question about expanding your business? Get in touch with our franchise lawyers on 1300 544 755 or filling out the form on this page.

This article was an extract from LegalVision’s Franchisor Toolkit. Download the free 32-page toolkit featuring case studies from leading Australian franchisors.

About LegalVision: LegalVision is a tech-driven, full-service commercial law firm that uses technology to deliver a faster, better quality and more cost-effective client experience.
Tim Mak

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