how to create a franchise operations manual

Steps to write an effective franchise operations manual

• 1. Define the franchisor-franchisee relationship ...
• 2. Explain in detail the business procedures and processes ...
• 3. Disclose complete information about your brand identity and products ...
• 4. List your business policies clearly ...
• 5. Keep a separate section for HR related policies and issues ...
• 6. Thoroughly review your document ...
• 7. Publish the franchise operations manual ...

Full Answer

What are 5 things that may be included in a franchise agreement?

Franchise agreements vary between different franchises, but these seven areas should be addressed in every franchise agreement.Use of Trademarks.Location of the Franchise.Term of the Franchise.Franchisee's Fees and Other Payments.Obligations and Duties of the Franchisor.Restriction on Goods and Services Offered.More items...

What are the five 5 strategic design components of a franchise business?

The 5 Elements of a Successful FranchisePowerful business systems.Serious brand power.Innovation.Powerful franchisee training.Wealthy franchisees.

What is the purpose of the franchise operations manual?

The franchise operations manual is the blueprint and how-to guide of a franchise system. Within the operations manual franchisors provide detailed information about system standards, operating procedures, suppliers and requirements for the development, marketing, and operation of a franchised business.

What are the five basic steps in creating franchising program?

To franchise your business, follow these steps:Determine if Franchising is Right for your Business.Legally Prepare and Issue your Franchise Disclosure Document.Develop Your Franchise Operations Manual.Register Your Trademarks with the USPTO.Establish Your Franchise Company.Register and File Your FDD.More items...

What are the 4 types of franchising?

The four types of franchise business you can invest inJob or operator franchise. These owner operator franchises are usually home based, which keeps overheads down to a minimum. ... Management franchise. ... Retail and fast food franchises. ... Investment franchise.

What are the basics of a franchise?

A franchise (or franchising) is a method of distributing products or services involving a franchisor, who establishes the brand's trademark or trade name and a business system, and a franchisee, who pays a royalty and often an initial fee for the right to do business under the franchisor's name and system.

What should a franchise operations manual include?

The manual for a franchised restaurant will often detail mandated menu items, food safety and sanitation requirements, proprietary recipes, procedures governing back-of-house and front-of-house conduct, specific management tools and software requirements, and marketing guidelines.

How do you create an operations manual?

How to Create an Operations ManualDocument Processes.Define Business Policies.Specify Organizational Hierarchy and Job Roles.Write Job Descriptions and Contact Details.Clarify the Emergency Response Plan.

What will happen if the franchisee will not follow the franchise operations manual?

Without a franchise operations manual or similar quality control document, the franchisor has no legal way to enforce their operational standards across the franchise network. A document that clearly sets out the role of the franchisee in the organisation.

How do you create a franchise model?

How to Franchise a BusinessMake sure your business is ready to franchise.Protect your business's intellectual property.Prepare a financial disclosure document (FDD)Draft a franchise agreement.Compile an operational manual for franchisees.File or register your FDD.Set a strategy to achieve your sales goals.

How will you ensure efficient franchise operation?

When it comes to the new opening process, franchisors should consider four key elements that contribute to success:The importance of following the system,growing with the right franchisees,establishing a successful opening process, and.assisting franchisees with support teams.

What is the process of management use in a franchise business?

Design Your Franchise Model Your franchise agreement term and renewal conditions. The geographic areas you will go into and the specific territory rights for each franchisee. The amount of start-up and ongoing training you will provide. Whether franchisees must buy products or equipment from your company.

What are the strategies in franchising?

Five Strategies for Franchisee SuccessFollow the System. Deviating from a proven system can cost you your franchise. ... Connect with Other Franchisees. ... Recruit Well and Keep Training Your People. ... Stay in a Marketing Mode. ... Communicate Consistently.

What are the different franchising strategies?

The five major types of franchises are: job franchise, product franchise, business format franchise, investment franchise and conversion franchise.

What is strategic planning in franchising?

Your strategic planning phase should include questions such as: What is the motivation for franchising your business? Is it rapid replication with third party capital? Does the owner want to extract him or herself from operations? Who will champion the franchising effort?

What is franchising in strategic management?

Franchising is a business marketing strategy to cover maximum market share. Franchising is a business relationship between two entities wherein one party allows another to sell its products and intellectual property. For example, several fast food chains like Dominos and McDonalds operate in India through franchising.

What to do before publishing franchise operations manual?

Before you publish your franchise operations manual, make sure the layout and formatting are consistent throughout. This step will give the document a final touch of professionalism, which should motivate franchisees to respect it and adhere to it.

How to protect a franchise manual?

As a result, you should take measures to protect it against misuse . One of the best ways to do this is by limiting the number of people who see the document before signing a franchise agreement. Ideally, you would only give it to those who have signed on the dotted line, but you will usually need to let potential franchisees who are close to committing take a look too. In these cases, they should sign a confidentiality agreement first. You should also consider liability issues when writing the manual, so it may be helpful to consult an expert in franchise law and a professional editor.

What is an operations manual?

First of all, what actually is an operations manual? Well, it’s a document written by the franchisor for the franchisees who buy into the business. It details the rights and responsibilities held by both the franchisor and franchisee, and explains how the franchise’s business model works.

What is the most important tool for franchisees?

The operations manual is probably the most important of these tools. Without it, there would be no standardisation across the franchise system, and franchisees would be able to run their unit in any way they wanted to.

Why is an operations manual important?

This is vital, as the success of a franchise relies, to a certain extent, on providing the same service at every unit. If this isn’t the case, the brand’s reputation is likely to suffer, for two main reasons: a.

How to give investors a better understanding of franchise?

Give your investors a better understanding of the franchise by describing the brand and how it should be portrayed. Here, you should create marketing guidelines and specify when and how franchisees should use your logo and other imagery. Also, give more information about your product range or services, how they’re priced and which suppliers you use. Don’t forget to include details of any specialist software or equipment franchisees will need to use.

What happens if you don't have an operations manual?

Without an operations manual, standards will inevitably vary between franchise units and damage the brand’s reputation. Operations manuals also make sure all franchise units use the same IT systems, financial processes and health and safety procedures.

What is the third part of a franchise operation manual?

The third important part of a franchise operations manual communicates how the business operates. Here, the franchisor trains the franchisee what the company does and the procedures to do it. This section describes the products and/or services offered in the business. So, this part has two sections: the description and the explanation.

What is the second objective of a franchise manual?

The second objective of the manual is to tell the franchisee about the brand. It's a chance for the franchisor to tell the new owners about the business. The section empowers the franchisees to replicate the brand quality and standards to the new business.

What is an operations manual?

The operations manual contains confidential information from the franchisor to the franchisee about the systems, procedures as well as operations of the business. Namely, it covers the “how-to” guides that make it easy for the franchisee to operate.

What is a franchisor's legal document?

Also, it serves as a legal document through which a franchisor advises the franchisees about the elements of the business, including the marketing, procurement, and other operations. This includes the exclusive suppliers from which the franchisee can buy products and ingredients.

What is a franchise blueprint?

In short, it outlines the parameters within which you should operate. This blueprint is the franchise operations manual.

What should the "Our Story" section tell franchisees?

The "Our Story" section should also inform the franchisee about the founders and management team and protocol. It should also tell them about the potential customers, services and products offered.

Can franchisees be partners?

The franchisees, though not from a legal perspective, serve as business partners to the parent company. This section of the document should help them to imitate the mindset in the business. Therefore, franchisees and their employees can follow the parent company's policies and procedures, especially with customer service.

What is a franchise operations manual?

A franchise operations manual is one of the most important documents that a franchisor creates during the franchising process. Simply put, it is a guide on what needs to be done and how it needs to be done. It is typically a manual with 100’s of pages and contains set guidelines and advice on each and every aspect of the company.

Steps to write an effective franchise operations manual

The franchise operations manual is an exhaustive document and writing one can seem to be a daunting task. However, breaking the information it should contain into its core parts, can simplify the drill. The information that an operations manual contains can be broadly classified as follows:

Why does any business need an operations manual?

An operations manual helps maintain standards across the business network. People come to a McDonald’s or a Subway or a Domino’s because of the reputation these brands have and also expect a certain standard of products and service.

Why do you need a franchise operations manual?

In short, a carefully planned and accurate franchise operations manual will help you make more money. It will allow you to manage your franchise network more efficiently, while simultaneously promoting clearer and stronger links between yourself and your franchisees.

Why is a franchise manual worth it?

There's a reason that so many people are willing to pay to get at the nuggets of information contained within the manual of a popular brand: Because a franchise operations manual will contain all of the knowledge that makes a brand successful. It's why their contents are often so well guarded.

Why is manual important for franchises?

of course, is that your manual should prevent franchisees from using the information contained within it to form their own company independent of your network. But there are a huge number of franchise liability issues that could arise from a poorly written document too.

What does it mean to be a franchisor?

If you're just starting out as a franchisor, this means that your manual might be significantly smaller than that of an established franchise system. To a certain extent, you might still be learning through operational trial and error and improving your systems...

Why is it important to have a well written franchise manual?

A well-written manual will let you create a cohesive, coherent customer experience across your franchise network. This will increase customer satisfaction and loyalty to your brand.

What should an operations manual include?

But your operations manual should always include as much detail as possible regarding operational practices that are to be followed. A simple list item that states "this obligation must be fulfilled" is not helpful.

What should a franchisee's contract include?

On a general level, it should include: Each franchisee's contractual obligations to you. Complete details regarding how you expect them to fulfil these obligations. On a basic level, it tells your franchisees what you expect of them. It gives them all the information that you've accumulated while operating your franchise.