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A challenging aspect of being a franchisor is ensuring each franchise maintains the quality standards your business has worked to achieve and maintain. Being proactive and providing clear training and instruction is critical to assisting your franchisees succeed. This article will discuss four ways to maintain quality standards as a franchise.
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Maintaining Quality Standards
Quality control across your franchise business is significant because each franchise represents your brand and image. Having a strong brand increases your revenue and customer visits. When customers visit a franchise, they expect the same quality regardless of location. Accordingly, consider the following tips to maintain quality standards.
Have a Detailed Franchise Agreement and Operations Manual
You will have a franchise agreement and operations manual to onboard new franchisees. A franchise agreement is your legally binding contract between the franchisor and franchisee. It sets out all the rules of the franchising relationship. An operations manual explains the day-to-day operations of your franchise. The manual would include:
- your business goals and mission;
- the franchise’s goals;
- daily procedures;
- the pay system; and
- customer service expectations.
Each document is essential to set out the quality of work, products or services you expect from franchisees. Having these expectations itemised and clearly set in writing ensures that those franchisees know the expectations from the start. In addition, franchisees can always look back at these documents to clarify for themselves.
Be Selective in Who Your Franchisees Are
Ultimately, one of the key players in maintaining quality control across franchises is who you select to be franchisees. Accordingly, make sure you carefully vet your candidates before signing on franchisees. For instance, ensure they have the skills and necessary experience to meet your business’ expectations and standards.
Each business will require different skill sets, so make sure you understand what skills are important to your business. For instance, are you looking for franchisees with managerial experience? Is experience in the hospitality industry essential?
Adopt Rigorous Training and Support Systems
Investing time and money into your franchisees will help maintain quality standards. Have intensive training to explain the quality standards of your brand. Make the sale targets, image quality, and customer service requirements clear. Likewise, quantify the standards and have clear benchmarks that each franchise needs to meet.
Amongst other areas, your training should cover:
- business operation;
- marketing;
- customer service;
- equipment maintenance; and
- finances.
Further, create a culture of transparency where your franchisees can feel comfortable asking you questions. Discussing your franchisees’ progress and where you think they can improve their quality standards is also valuable. Ongoing support and feedback will help maintain your franchise quality across all franchisees.
Implement a Compliance Policy
Sometimes, franchisees are not a good fit for your company and do not uphold the quality standard you expected. Therefore, make it clear that these are requirements of the company and that there may be a consequence for not complying with these standards.
Consequences can look like termination if the franchisee has breached their contract or provides the franchisee with reasonable written notice of proposed termination. However, you can terminate a franchise agreement if the franchisee’s failure to uphold quality has led to the franchisee either:
- operating the business in a way that endangers public health or safety;
- fraudulently operating the business;
- abandoning the franchise; or
- becoming convicted of a serious offence.
Key Takeaways
Franchising is a great way to expand your business. However, you want to maintain the same stellar quality across each location. Therefore, it is important to have detailed legal documents, select your franchisees carefully, have thorough training and support systems, and a compliance policy.
If you need help maintaining the quality standards in your franchise, our experienced franchise lawyers can assist as part of our LegalVision membership. For a low monthly fee, you will have unlimited access to lawyers to answer your questions and draft and review your documents. Call us today on 1300 544 755 or visit our membership page.
Continue reading this article below the formFrequently Asked Questions
A franchise agreement is a legally binding contract between the franchisee and the franchisor. An operations manual sets out the procedures and rules of operating the franchise.
Quality standards set out the expectations for franchisees to follow to maintain a high business quality. These quality standards apply in training, image, performance, marketing and service.
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