Another Example of a Control Casualty

[Walter Hay]

As a very successful former franchisor, I can confirm that there is absolutely no argument against the statement that a person who buys a franchise is surrendering CONTROL of their business.

This is why in my posts on the subject of franchising, I emphatically say SELL FRANCHISES don't BUY FRANCHISES.

From a franchisor's perspective, with many franchisees in four countries by the time I sold the business I can also say unequivocally that CONTROL over franchisees is essential.

For example, a cornerstone policy of my franchise system was a) The customer is always right, and b) As a result the franchisees must employ a more than generous guarantee policy.

Although this was written into the ultimate CONTROL document, the Operations Manual, convincing the franchisees to adopt that mindset was the most difficult part of their education. Consequently, it had to be enforced.

Most people rebel against being forced to comply with rules, but when they have signed a contract that specifically states that they are obliged to abide by those rules it is clear that non-observance is a breach of contract.

I am pleased to say that I had no rebellions, and that was probaly due to the fact that I practiced what I preached , being generous in my attitude towards franchisees. I also delivered the goods. For legal reasons it can be dangerous for a franchisor to make earnings promises, which I avoided, but the average profit of my franchisees was around 4X the national average salary.

For more information on franchising you can search for my posts on the subject or you might like to start with this thread:

Rapid Scaling a business by franchising​

Walter

 

[Deleted50669]

Franchisees. People who buy into preexisting corporations as business owners are pretty much asking for it. They may own and operate a business, but that business still reports to the corporation within which sit its shareholders - who ultimately make the strategy level decisions. This is an interesting thread regarding how the pandemic has brought to light the perils of lack of control in franchising.

Franchisees face corporate battle | LinkedIn

Small business owners who operate franchises like Subway or McDonalds tell The Wall Street Journal that instructions on pricing and equipment from corporate headquarters could force them to go under.

www.linkedin.com

 

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[Kal-El1998]

I've always been under the impression that if you're a franchisee, you often own many different storefronts. And probably have multiple other sources of income. Could just be my personal experience though, I haven't heard of anyone with just one franchise though.