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The franchise is a contract that links 2 partners, 2 independent companies, the franchisor and the franchisee to copy a proven success, in limiting the risk of the company creation thanks to 4 elements :
1) the customers’ rallying signs : the brand
2) the products and services
collection.
3) the transmitted know-how
4) the help
1) The customers’ rallying signs are elements that allow the actual and
potential customers to know the network, (notoriety) to know the offer and to
appreciate it (brand image) and to be willing to go back there (loyalty
earning).
The trademark and the brand are the main visible elements, but also are often the affective link’s support between the network and the consumer. (We like a trademark, we like to go in a store, we like the products, sometimes we like other people to see that we buy this product, we can also like the image that we give of ourselves, etc.)
Customers’ rallying signs generally include the type of architecture and decoration, the graphic charter, the advertising…Of course, for some brands like hard discounters, the symbol erases a lot behind the price/quality and the price ratio.
2) Naturally, a brand or a trademark that would not be clearly linked to
a defined and respected products and/or services range could not have a
sufficient attraction power. Indeed, if the content is not consistent enough,
the brand image is not clearly perceptible. (Let’s imagine that Mc Donald’s
sells french fries and steaks served in a plate and seafood, would it still be
Mc Donald’s? Let’s imagine what would be Hilton hotels if customers did not know
in advance which type of room, services and price they can expect? Would it
still be Hilton?)
3) The know-how is divided in two parts :
- the one that the franchisor
exploits by himself to give the franchisees more efficient services thanks to
the mass effect or the productivity advantages linked to centralization, but
also because it is a different job than the one franchisees have in their
company even though it is necessary to their performance (national advertising
or production of a clothing collection for example)
- the one that the
franchisor transmits to the franchisee through the training, the exploitation
handbook, etc…in order to make the franchisee efficient in the
commercialization, the customer relation, the management, the exploitation of
his franchise, etc. It is a know-how transmitted that builds the franchise.
The know-how is the result of the experience and also successes, failures and
the lesson that you learn from it. that it is how you improve. It is made of a
unit of recipes, of know-how, tricks, management or organization tools, methods
that the franchise better uses or that are differentiated in the franchise
brand.
The know-how must always evolve to keep active and able to give an
advantage to the network’s members compared to competition. It is not easy, that
is the reason why it is interesting and necessary to have one or several pilot
units that will experiment and validate the concept innovations and the know-how
before transmitting it to the franchisees.
The know-how transmission starts when the exploitation handbook is given and
the contract signed and follows mainly during the initial training but also goes
on all along the network life with the continuing training and the franchisor’s
visits, etc.
4) The assistance is essential and complicated. It is an help
on site or from distance to help the franchisee analyzing his exploitation,
finding his weaknesses, find the right application of the know-how and correct
what can be corrected. The franchisor must make sure to give advices and ideas
coming from his experience and his analyze without being too controlling because
the franchisee is independent and responsible for his decisions.
Jean Samper
Consultant in franchising (AC Franchise)
Member of the
collège des experts of the fff
Total investment (from - to) |
| » < 10.000 EUR |
| » 10.000-25.000 EUR |
| » 25.000-50.000 EUR |
| » 50.000-75.000 EUR |
| » 75.000-150.000 EUR |
| » 150.000-300.000 EUR |
| » > 300.000 EUR |