A guide to the role and responsibilities of a franchisee

19/06/2018 14:00 | Start a business

Role and responsibilities of a franchisee

Before you decide to become a franchisee, you must first understand the role fully as well as what will be expected of you. The relationship between the franchisor and franchisee is a unique one and not every budding entrepreneur is suited to the role.

Before you sign the franchise agreement, here are five things you should know about being a franchisee:

1. Youll need to have adequate finances to fund your new venture.

There are many benefits when you become a franchisee but buying into a tried and tested business model with a proven track record of success comes at a price. The very first responsibility youll have as a franchisee is to cover the initial franchise fee.

This investment covers the cost that the franchisor has incurred while recruiting and training you, but you should be prepared to fund additional costs before you can get started. As well as the franchise fee you'll need to cover additional set-up costs. These can include leasing business premises, purchasing business equipment and getting the right insurance in place.

And thats not all. Once youre up and running, very often youll have to pay ongoing fees too. The royalty fee covers the cost of maintaining and improving the franchise system along with any training and support that you continue to receive. You may also be expected to pay a regular marketing fee to contribute towards national promotional activity. Both of these payments are generally calculated as a percentage of your gross sales.

2. Be committed to making your franchise a success.

Many people think that when you buy a franchise that all the hard work has been done for you, so you can sit back and watch the money roll in. These same people are likely to be very disappointed if they decide to become a franchisee.

When you sign the franchise agreement, youre essentially becoming a business owner. And just as you would expect to dedicate all the time and effort necessary if you started an independent business, the same applies to a franchise.

You must be prepared to learn the franchise system through the training thats on offer. The franchisor will have invested blood, sweat and tears into making their business a success and you have the opportunity to learn from their mistakes. The franchisor and franchisee relationship will be strengthened if you demonstrate that you're committed to following the rules to become a profitable franchise.

3. You must protect the franchise brand.

When you sign the franchise agreement, you become a representative of the franchise brand. Its in your best interests to adhere to the rules and guidelines that have been established by the franchisor. By being committed to fulfilling your obligations as a franchisee, the reputation of the brand will be safeguarded.

You have a responsibility to protect the brand by doing the following:

  • Build a strong and loyal customer base by offering quality and consistent products and services.
  • Make sure that employees are adequately trained and always provide exceptional customer service.
  • To complement the marketing campaigns that the franchisor arranges with local promotional activity that adhere to agreed guidelines.

The consistency of the products, services and brand are fundamental to the success of a franchise, and you play a crucial part in making this happen.

4.Remain inquisitive

Right at the beginning of your franchising journey, youll ask many questions about the franchisor and the validity of their business. This need to have all the details should never be lost if youre to become a successful franchisee.

The franchisor and franchisee relationship is one likened to a teacher and student. It's in the franchisor's best interests to share how the franchise system works, and it's important that you take on board what is required to run a lucrative business. Attend all the training sessions that are available to you and ask questions when you need more information.

And it's not just the franchisor that you can learn from. It can be beneficial to meet up with other franchisees on a regular basis. Networking with other franchisees enables you to share stories, ideas and problems with your peers. The chances are that there will be more experienced franchisees that can assist you with any issues you may be encountering, you just need to have the confidence to ask for help.

Good franchisors understand the importance of continuous learning and will support you in your quest to gain knowledge and become skilled as a franchisee. When you perform your due diligence ask about the ongoing training thats available and how often the franchisor arranges for all franchisees in the network to meet up. This will give you a good indication of how supportive the franchisor will be throughout the term of your franchise agreement.

5.Be prepared to adapt.

The role of a franchisee can be varied. You may have to deal with a customer complaint one minute and be mopping the floors the next. You'll need to be able to switch between wearing many different hats while ensuring that the business runs smoothly.

Youll be responsible for handling the daily operations involved in running your business, as well as being able to manage staff and grow the business too. It can be a difficult task and one that requires organisational and leadership skills. If youre prepared to put the effort in though, youll reap the rewards.

If you think you have what it takes to be a franchisee, then there are plenty of opportunities for you to consider in a variety of different industries. As long as youre prepared to follow the rules, are committed to making your franchise a success and are willing to learn from the franchisor, then theres no reason why your business


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