At the beginning of the franchising journey, most franchisors will still be very immersed in the day to day operations of the core business. They may still be running their own location while trying to get their franchise off the ground, or at least still only very recently removed from that.
However, as a franchise brand begins to scale and grow, the franchisor inevitably becomes more involved in the growth of the network and thus moves further away from the “coal face”. It can be at this point that establishing a Franchise Advisory Council (FAC) can be wise and strategic decision to aid the upward trajectory of the business.
A FAC is a committee of franchisees. It is organised by the franchisor and its aim is to provide regular feedback to the franchisor from the franchise network, so that the franchisor remains in touch with and aware of the challenges and issues facing their franchisees when running their businesses. In this way, the the franchisor in turn can look to address any issues and concerns and effect change where appropriate and needed. A great and effective FAC is based on open communication and collaboration – franchisor and franchisees working together to ensure the brand keeps moving forward and that the needs of the franchisees are understood and met wherever possible.
For any franchisor looking to establish a FAC, careful thought needs to be given to the structure and the remit of the council and how members will be recruited. Will the franchisees appointed to the FAC be selected by the franchisor, which could then lead to accusations of favouritism? Or will they be voted into the roles by the franchisees themselves, in which thought needs to be given to selection/qualifying criteria so that the make up of the FAC does not become unbalanced and lacking in some key experience or other relevant characteristics. How often will members be rotated to ensure other franchisees get an opportunity to partipate? There should be a clear understanding of what being part of the FAC will involve and how much time commitment will be required. And importantly all parties must recognise that the purpose of a FAC is not solely to air grievances, nor is it a vehicle which the franchisees can use to make demands of the franchisor. Whilst emotions will inevitably run high at times during discussions when parties are so passionate and engaged as well as financially invested in the brand, the focus of a FAC is to improve the business from the perspective of all parties – franchisees, franchisor and end users – to find solutions to problems, to innovate and to keep the brand moving forward. The franchisor may find the use of a facilitator at FAC meetings useful in ensuring the group remains focused.
From a franchisee perspective, a FAC offers a formal forum at which they can be heard. It ensures that franchisees feel valued and involved in the growth of the business. Their views can help to inform real change and progress within the franchise. It can help to foster and maintain a positive and mutually supportive franchisor-franchisee relationship.
From the point of view of the franchisor, a FAC can be an invaluable link to their customers and their market. The council can help them to understand and remain abreast of trends, as well as identifying challenges facing their product or service or with issues such as recruitment or the supply chain. As well as using the franchisee feedback received through the FAC to improve franchise and support systems to maintain a happy and engaged network, FAC members can be invaluable to a franchisor looking to implement change within the network, whether that be through the introduction of something such as a new tech system or process, or rolling out a new product or service, If the Franchise Advisory Council is on board with planned change, then those franchisee members can become key in enthusing the rest of the network and working towards a smooth transition or implementation. A well established and run FAC can become an incredible valuable marketing tool in attracting potential franchisees too.
In the current economic climate and at times when consumer trends are changing and evolving so rapidly, a successful Franchise Advisory Council can be an extremely valuable asset to the franchisor and the brand as a whole. However it must be fairly and properly established and its mission and use clearly understood by all concerned. Just as a well run FAC can be a vital tool for growth, a poorly managed FAC established simply as something that something the franchisor feels they need to be “seen to be doing” can have the potential to be incredibly damaging to the franchisor-franchisee relationship. Both franchisor and franchisee have the same motivation in wanting and needing their businesses to succeed and grow. Listen and learn from a Franchise Advisory Council, and the brand and everyone within it has the potential to flourish.
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