As a former franchisor, and developing franchised my company to get over 10 years before I actually sold it, it seems to me that I’d experienced in relation to possible scenario. Most people feel that franchising is really cut and dry; you have a business agreement, people pay you will a certain amount to purchase their franchised outlet, and then they get the job done the business or store for a 10 year term by means of automatic renewals.
This is a serious issue, and it happens again than people realize. Franchisors need to demand that the appropriate procedures are followed, in any other case you run into all sorts of situations. Please consider all this and think on.
You see, in the franchise agreement there are stipulations before you switch the business to someone else, the fresh franchisee has to then hint the latest franchise agreement, and have to be approved by the franchisor. It turned out the brother-in-law was not running the business much like our confidential operations instructions, he had made quite a few shifts.
One day, I appeared to fill in for one of the area representatives in that section, and I went to visit the franchisee on the Georgia side. When I got there, I just was talking to his brother-in-law. Apparently he was today running the business, and some of our franchisee had transferred this company to him without acceptance.
That really doesn’t happen with franchising, and although franchising is an extremely successful business structure for distributing goods, solutions, and products; it isn’t Disneyland. I doubt any online business really is.
Yes, that sounds like a decent business model, then again nothing is ever as basic as it appears in the franchising industry. Let me explain. Through the years, I don’t think I ever endured a perfect franchise sale when everything went exactly perfectly; where the franchisee qualified for the loans very quickly, 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 10 years they were in business prior to vitality.
I explained to him that he had to run the business a certain way, and he stated that I was wrong, because he didn’t sign any sort of agreement, and he would definitely do it his way. Wow great I thought, now I have a rogue franchisee on my hands, and they are not keeping with the regularity of our brand name.
Worse, this individual wasn’t following the proper types of procedures which were part of a large fleet account we had with a indigenous company. Again because he didn’t have to follow are confidential operations manual, which he never read simply because as he said; “I never signed nothing. inch Nor did he ever go to our franchisor training, which is also required of new managers which are running our franchised business model, if ever the owner is not involved in the day-to-day operations.
Let me give you an illustration of this a crazy thing that happened to us. There were a franchisee who lived on the border of Ga and Alabama. We allowed them to have a joint location in both states. As a consequence of type of industry we took part in in there were different regulations on each side for the border.
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