5 Best Practices for Franchisor-Franchisee Relationship

Starting a franchise lets people get into business for themselves without going through some of the challenges of creating a brand new business, hoping it will be successful. A franchise comes with tested methods and products, training geared at success, and by nature, embraces and promotes the best day-to-day business practices.


A best practice is a standard operating method geared toward finding and maximizing the best way to achieve the best results. Best practices can be developed and even evolved to fit the needs of the franchise. When you purchase a franchise, the franchisor has already established a set of best practices designed to give its franchisees the best way to succeed. The franchise system of doing business represents the concept of best practices at its finest. It's because successful franchises have been built around a series of best practices that the average American can buy a franchise and live the American dream of owning a business and being successful at it. Finding and developing best practices for a business would otherwise take years.

What to Expect From a Franchisor in Terms of Best Practices

When you buy a franchise, you do it because you want to be in business for yourself. However, as a franchisee, it's important to realize that owning a franchise means a relationship between you and the franchisor. All successful franchises have a set of best practices that contribute to your success as a franchisee. Here are five best practices you should expect from the franchisor.

1. The franchisor should understand the basics of franchising and convey its business model to the franchisee. The franchisor is supposed to do more than license a trademark. The franchisor's goal is to provide franchisees with a complete method of doing business that contributes to success using a variety of controlled systems that are clearly defined. The goal is to make these systems so refined and consistent that they create a consistent experience across all franchise locations. Franchise best practices are not always written in stone and are sometimes adjusted from one location to the next to take into account the different diversities of a certain location. Your franchisor should understand your specific needs and work with you to ensure your franchise's success by considering revisions to the existing franchise structure for your benefit.



2. You should have access to representatives for the field that interacts with franchisees to help them successfully set up their business. These representatives should be educated in the franchisor/franchisee relationship and be able to represent the franchise to you accurately.
3. Franchisors should respect your rights as an independent business owner. While buying a franchise does lock you into a specific business model, most franchises that succeed understand that their success is based on the individual experience and personalities that come with the franchise. Look for a franchisor that will respect you as a business owner and franchisee of the company.
4. You can expect a franchise agreement, training, and a comprehensive manual the franchisor uses to strengthen your knowledge and understanding of the franchise and its operations. These things can also ensure your knowledge of the franchise rules and regulations while protecting both parties from misunderstandings about expected operations.
5. The franchisor should exercise only the control necessary to protect trademarks and the reputation of the brand.

All franchises engage in the best practices to some degree. The five basic best practices discussed above are the most important. Best practices will vary from one franchise to another, but any franchise you purchase should adequately convey their best practices to you and answer questions. You are entitled to know about these best practices through your franchise disclosure and franchise agreement documents. Before you sit down to sign papers, make a list of questions about the franchise-best practices, and be ready to present them. If you don't get the answers you are looking for, then be persistent about it. A franchise that cannot convey their best practices and the purpose of those best practices might not be a franchise you want to be a part of. As always, a franchise lawyer can help you understand the best practices of a franchise as well as the franchise agreement and any information you get from a franchise disclosure.

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