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As a former franchisor, and needing franchised my company meant for over 10 years before I actually sold it, it seems opinion that I’d experienced concerning possible scenario. Most people reckon that 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 use the business or store for the 10 year term by means of automatic renewals.
Yes, the fact that sounds like a decent business model, however nothing is ever as straight forward as it appears in the franchising industry. Let me explain. Through the years, I don’t think I ever endured a perfect franchise sale where by everything went exactly perfectly; where the franchisee qualified designed for the loans very quickly, previously had a perfect resume, had a superb location, didn’t care to negotiate any terms with the franchise agreement, and every thing went perfect during the a decade’s they were in business prior to vitality.
You see, in the franchise arrangement there are stipulations before you switch the business to someone else, the brand new franchisee has to then hint the latest franchise agreement, and they have to be approved by the franchisor. It turned out the brother-in-law was not running the business per our confidential operations information, he had made quite a few changes.
One day, I appeared to fill in for one your area representatives in that vicinity, and I went to visit the franchisee on the Georgia aspect. When I got there, We were talking to his brother-in-law. Apparently he was right now running the business, and your franchisee had transferred the business enterprise to him without acceptance.
That really doesn’t happen with franchising, and although franchising is an extremely successful business design for distributing goods, offerings, and products; it isn’t Disneyland. I doubt any industry really is.
This is a serious issue, and it happens on a regular basis than people realize. Franchisors need to demand that the proper procedures are followed, usually you run into all sorts of circumstances. Please consider all this and think on.
Worse, the person wasn’t following the proper techniques which were part of a large navy account we had with a domestic company. Again because the guy didn’t have to follow are actually 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 training, which is also required from new managers which are sprinting our franchised business model, in the event the owner is not involved in the day-to-day operations.
Let me give you certainly a crazy thing the fact that happened to us. We a franchisee who enjoyed on the border of Georgia and Alabama. We allowed them to have a joint property in both states. As a result of type of industry we participated in there were different rules and regulations on each side of the border.
I explained to him that he had to run the business a clear way, and he stated that I was wrong, considering he didn’t sign any agreement, and he was going to do it his way. Wow great I thought, now I have a rogue franchisee on my hands, and they are not keeping with the uniformity of our brand name.