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Managing Franchisee Relationships

Franchise Your Business:  Managing Franchisee Relationships.

Is managing a large franchise system equivalent to being as difficult as herding cats?

As a franchisor, a business owner becomes a leader, coach, counselor and family member all rolled into one.  It is an extremely complex and dynamic role for a business person to manage the responsibilities that come with being a franchisor.  The good ones have a unique skill set and a solid foundation as a business person which is needed in franchising to be successful.  Franchising successfully is dependent on a specific personality type and character to be done right.  One needs to be sales oriented, relationship driven, flexible, patient, a mentor and extremely good at thinking outside of the box.  In the franchise business it seems that more often than not, things fall outside of the box.  Why is franchising so unique in the realm of business transactions and management?

1.  Franchisees are people who fall somewhere between entrepreneurs and employees of a specific organization.  They have the drive, independence and commitment to succeed on their own, but you want them to follow a specific game plan in the way that they operate their business.  This independent vs. structured partner makes the management and interaction with franchisees unique and complex.  A good franchisor knows how to harness the positive side of a franchisee’s entrepreneurial energy without letting anyone forget who the sheriff is and keeping everyone in line.

2.  Franchising is a business process that relies on volume.  For the franchise distribution channel to work successfully and with complete efficiency, it requires volume.  With a large number of units, there are certain to be many different personalities, people and backgrounds amongst the franchise partners of any given franchise system.  Franchisor’s who can manage the different personalities and keep as many people happy at one time will tend to do best in this business.  Entrepreneurs who recognize that this may not be a skill set for them are better off to hire a franchise director that has this skill set needed to take a franchise system to the next level of growth.

3.  When you franchise your business, it is a fast paced business growth model.  As a business owner, you surely have had that feeling before when it is like you’re on a bull that is a little out of control and you can’t fully get your footing underneath you.  While this can be a good thing, meaning growth and change are taking place, it also can be unsettling for some who may not be able to manage this kind of pace.  Franchise systems average over ten new units open per year when marketing aggressively and in the later stages of their maturity.  It can be fun…or scary depending on what type of person you are.

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