Franchise Success Tips: Maintaining Great Relationships

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These days more and more small businesses, having reached a certain degree of local success, are looking toward the future and beginning to franchise. Many of these small business provide products or services to a highly specific niche in the marketplace or operate as a subset of a larger market, such as those who supply specific services for food-service entities. Franchising a small specialty business presents a unique set of concerns that can make keeping a healthy relationship between franchisor and franchisee a struggle.

Marketing Problems

For many small franchisors, broad-ranging high dollar marketing simply isn't a practical strategy. This is even more true for franchises that offer very specialized products or services that appeal to a very small subsection of a community. For these types of businesses, successful marketing can be a substantial ordeal in itself.

For a small franchisor, expansive market research may not be a fiscally realistic course of action, and there may be an element of hit-or-miss to advertising strategies. This is especially true for those franchisors just begin to establish themselves with very few franchises in operation.
The problem arises for these small franchisors, when their franchisees begin to perceive that the regular advertising fees they pay to the franchisor are not getting results, not being used for successful marketing campaigns and not benefiting the individual franchise. This can create dissent and a rift between franchisee and franchisor.

Marketing Solutions

One means of rectifying this problem or even preventing this rift from happening is for smaller franchisors to include franchisees in the decision making process regarding advertising. For very small franchising organization, this can be accomplished by open discussion with individual franchisees. Somewhat larger franchisors may wish to establish a volunteer panel of franchisees to represent the whole in contributing to marketing and expressing the needs of the franchisees.

Royalty Problems

Another area of potential strife between franchisees and franchisors lies in the realm of ongoing royalty fees. If the brand is not consistently growing and providing increasing value for the individual owner, then issues about "value for money" begin to crop up. Such concerns tend to spread quickly through franchising organizations and can actually damage the appeal of the franchisor to new potential investors. Though it is understood explicitly that the royalties are for use of the franchisor's trademark only, there is a certain expectation by franchisees that their franchising organization will grow over time.

Royalty Solutions

The only way to really skirt this issue is for a franchisor to actually take steps to grow the brand, not just by courting new franchisees, but by actually developing the products and services of the company and by improving promotional activities. A smart franchising organization will, of course, be doing this already. The key is to express those actions to the franchisees.

Most franchisees will operate under the rule "if I don't see it happening, it isn't happening". Thus, a wise franchisor will avoid undue discontent by keeping owners apprised of developments within the franchising organization, via newsletter or other means of inter-franchise communication. Keeping franchisees in the loop can prevent misunderstandings and promote a better relationship between franchisor and franchisees.

Article Source: http://depositarticles.com/

If you have any additional franchise questions there are many places you can go. Examine a real franchise example at filtafry . For even more information about this particular emerging franchise visit Filta Fry . Interested in getting you questions answered right away? Call the Filta Group at 407-996-5550.

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