8 Tips for Managing Conflict as a Franchisor

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franchise conflict

No franchisor wants to waste time and risk damaging their reputation as a result of disagreements within their business. Here are our top tips for managing conflict in your franchise.

Avoiding franchisor-franchisee conflict relies on developing a robust relationship with all your business partners. Although you built the franchise and are in control of its operating processes, you need to give franchisees enough freedom to run their businesses efficiently and happily.

To find out more about why issues might occur, you can read up on the top five most common sources of franchise conflict. But, in this article, we’re taking a look at how you can avoid rifts altogether. Here are some of the best tips for managing conflict as a franchisor.

8 Tips for Managing Conflict as a Franchisor

Don’t wait until a conflict has ballooned out of control. With a strategy of conflict prevention, you can stop issues in their tracks before they even occur. This may be easier said than done, but it’s worth taking extra steps now to eliminate headaches later on.

In general, you want to avoid letting things escalate to the point where you get written complaints. Once a franchisee starts putting their concerns in writing, it’s time for you to try to rapidly dissolve the situation. Written complaints are one step away from legal action – and it’s likely this is the first step a franchisee will take in preparing a case to be used against you.

While it may be necessary to take legal action against a franchisee, this should be a last resort. Not only does this long and drawn-out process take you away from running your business, but it can also be damaging for the franchise's reputation. So, how can you nip potential issues in the bud?

Keep reading to find out about the conflict management steps you can take.

1. Recruit the right personalities

You can minimise the likelihood of franchise conflicts arising by recruiting your franchisees carefully and avoiding potentially disastrous partnerships in the first place. Steer clear of any fiery personalities; instead, look out for entrepreneurs who appear calm and composed.

Of course, you can never be sure how people will react to challenges or stress further down the line. But you should try to select candidates who seem like they’d keep a level head in difficult times and approach issues in a responsible manner.

A good way of checking out a candidate’s personality is by chasing their references. If they’ve had a sour relationship with more than one previous employer, this doesn’t bode well for your future collaboration.

2. Allow for open communication

The best way of preventing franchise conflict is by maintaining open and honest communication. Be a franchisor whose franchisees are happy to pick up the phone and call them whenever they have a question or concern. Let them know you’re willing to talk about any issues they may be facing, and give them the time to discuss it in detail if they want to. Once you’ve opened up this ongoing dialogue, it’s less likely your franchisees will feel overlooked mistreated or out of their depth.

One thing to note: Avoiding and preventing conflict are not the same thing. If you brush crucial issues under the carpet, they’ll only fester. Prevention is about communication. Avoidance is just delaying the inevitable.

3. Hold regular meetings

To further encourage communication, you could consider holding franchise events on a regular basis. This will give franchisees the opportunity to voice any concerns and should encourage them to speak up. Try not to feel threatened by this possibility; listening to constructive criticism is essential if you want your business to grow.

You have a number of options when it comes to running regular events. Why not host an annual conference, where all franchisees can congregate to network and discuss their businesses? Alternatively, you could give your business partners the option to attend ongoing coaching sessions, or Q&A events. But whichever option you choose, keep communication flowing.

4. Encourage franchisee collaboration

Giving franchisees the chance to discuss their issues with you is only part of the story. Your business partners may want to turn to those in a similar situation to themselves. By facilitating collaboration between franchisees, you’ll give them another support network.

Investors will have the chance to mingle at your franchise events, but why not go the extra mile and introduce franchisee-led sessions? For example, organising a weekend of keynote speeches from your franchise’s senior figures is not going to create a collaborative atmosphere. Instead, consider handing over the microphone to high-performing franchisees and creating an open forum encouraging audience participation.

5. Don’t always refer to the franchise agreement

Although the franchise agreement defines the franchisor-franchisee relationship, you should try to resist the temptation to refer to it every time there’s a complaint. This is because it’s generally loaded in the franchisor's favour.

So, no matter whether you’re in the right or wrong, it’s incredibly frustrating for franchisees if you use the franchise agreement to justify your actions every time an issue arises. To them, you’ll appear unwilling to let them have their say or engage in discussion. Instead, review the issue with a fresh pair of eyes and try to take an objective stance.

6. Look for things you agree on

No matter how good your franchisor-franchisee relationship is, there’s always going to be some elements of the partnership you don’t see eye-to-eye on. While some of these issues may cause conflict, it’s often useful to look to the attitudes you have in common when you start to brainstorm possible solutions.

Let your shared interests, values and ideas direct the conversation and look for ways they can be introduced as you develop your relationship. If you’re at constant loggerheads, you have a bigger problem. But if you can find something that unites you, you’re on the path to avoiding potential bumps in the road.

7. Try to find a compromise

This may sound obvious, but it's incredible how rarely the franchisor or franchisee tries to search for a way to compromise. More often, both stick to rigid and unhelpful attitudes and fail to back down or even come to an understanding.

If you want to prevent and resolve conflict, you need to act like this is your goal. Don't get wrapped up in single-minded determination. Try to find a middle ground and understand where your franchisee is coming from. Remember, a positive and cooperative franchisor-franchisee relationship will benefit you both in the long run.

8. Listen

One of the most important skills a franchisor can learn is the ability to listen. All too often, franchisors just hear what they want to hear and overlook the franchisee’s major concerns. If you're going to resolve a conflict, the best way to start is by really listening to the franchisee’s issues.

You may feel your business partner is being completely unreasonable or has a request which violates the franchise agreement – but you still need to hear them out. Even if you don’t have any intention of agreeing to their request, it will show you care about their concerns and value their contribution to the business by listening to them.

Read more

We’ve got a bank of articles written specifically for franchisors. Take a look to find out how you can boost your business’s performance and keep your franchisees happy.

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