There are rules in franchising? Of course there are!
If you’ve researched any franchise concept in detail, you’ve probably read their Franchise Disclosure Document (FDD). If you haven’t read it yet, do it! If you have read it you’ve probably felt there were rules franchisors implement on franchisees. Reading this may have caused you to wonder to yourself – or out loud – why are there so many restrictions and rules? This is a great question and one that I would encourage you to discuss with your Franchise Development Specialist.
At first, these rules imposed might feel a bit restricting
. But, there are very important reasons for these restrictions. First, any good franchisor understands its responsibility to protect the franchises within the brand. They realize the importance of safeguarding their franchisees from any new owners coming into the system and going “rogue”, potentially harming the brand and those within it.
Secondly, franchisors need to protect the brand and their brand name. Improper use of the brand name, logo, or its likeness can cause trademarks to be lost. Slapping an unapproved logo on a hat might seem harmless at first, but multiply this by hundreds of franchisees doing the same and now there are so many variations of a similar image that it loses its ability to be safeguarded. Now your competition has their own version of your logo. How does that help your business?
Third, they must keep their brand and customer experience consistent. Imagine walking into your favorite sandwich franchise and finding a different menu at each location as well as a different experience at each. One location has your favorite sandwich and the staff knows exactly how to make it. The next location might have a version of that sandwich but it’s not the same. The third location doesn’t make that sandwich and, even worse, they don’t have the ingredients to create it. Would you continue to patronize this franchise? Most likely not. This is the same for the franchise you are researching. The restrictions keep the consistency among locations.
So, as you’re reviewing the FDD I encourage you to read it from the perspective of being an operator within the franchise. This might make you feel a little differently about these “rules”.
