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Franchise Branding

Written by: Peter Macrae Dillon

Article Overview: Franchising, by definition, requires adherence to the franchise concept. Only through a consistent application of the franchise’s image and methods will the separate businesses of individual franchisees result in one cohesive brand. peter macrae dillon Siskinds franchise franchisor franchising lawyer attorney Toronto Ontario Canada www.franchiselaw.ca

Franchise Branding

FRANCHISE BRANDING

Franchising, by definition, requires adherence to the franchise concept. Only through a consistent application of the franchise’s image and methods will the separate businesses of individual franchisees result in one cohesive brand.

A brand is the most valuable asset of a franchise system. The stronger the brand (i.e., the more people who recognize it) the more valuable it is. A study conducted by the University of Toronto business school in the 1980s found that the sales of franchised doughnut stores were almost 100% greater than the sales of un-franchised shops. Why? Because in our busy world, we want predictability. As a result, when someone who has never been in your town or city drives into town looking for a coffee and a doughnut, they are more likely to drive to a well-known brand name, rather than experiment with “Bob’s Do-Nuts” — even though Bob might make the best doughnuts in the world!

A franchise brand includes the name of the franchise system, its building design and decor and, importantly, it’s menu and the precise makeup of all of the food and beverages (and other items) available on the menu. Tinker with any one of those things, and you dilute the consistency, and therefore the strength, and therefore the value of the brand. By allowing different franchisees to “go their own way” the franchisor is, in effect, breaking its promise to the consumer. It’s kind of like saying “you can’t trust us anymore to deliver our goods and services to you in a predictable way”.

For those Star Trek fans out there, you can think of the a franchise as the “Borg Collective”. The entire organism must think and act with one mind. That does not mean that the individual creativity or initiative of franchisees must be eradicated. On the contrary, good franchise systems have means to receive, assess and implement good ideas from the field. It may very well be that your cookies can be integrated into the brand. However, before the brand can be adjusted, the item in question must be itself tested for consistency, appeal and marketability. If you’re looking to sell hot dogs, your franchisor is more likely to say “that is so far outside of the concept that we won’t even consider it”.

Remember, as a franchisee, while you do retain individual responsibility for the conduct of your business, you do not have carte blanche to operate it in any way you please, and the franchisor has the right and a responsibility to all of the other franchisees of the system to maintain a consistent image and methodology. If total independence is what you want or wanted, then you should not get into franchising and if you are a franchisee, you should sell your business. When purchasing a franchise, your expectation should be that your franchisor knows more than you do. You are also buying into something where the actions of others can positively or negatively impact your business. For instance, if other franchisees within your system don’t keep their washrooms clean, that will (according to my wife) have a decidedly negative impact on your business – even if you keep your washrooms spotless. This is because customers who have never been to your location will assume that you have the same standards of cleanliness as the other franchisees in your system.

On this franchising issue, “all for one and one for all” makes sense.

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