Franchise consultants will play a vital part in the setting up and development of your franchise business, as with Franchise UK many specialise in an array of services from general operational procedures to franchise recruitment.
Some franchise companies choose to develop their franchise business without any assistance and whilst this saves initial expenditure, the likelihood is that you will end up needing advice and guidance a little later down the line which could cause loses at a later date.
You have to remember that even your franchise operating manual will take up valuable time in its research and compilation, even then it may not be accurate enough to guide your franchisees in the appropriate manner. Remember you may assume that any new franchisees will know what you know about the business but generally speaking, this is not the case and it is better to get the outside view of a consultant.
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It is vital that you instruct a franchise solicitor from the early stages of franchising, not in the least to assist you in the creation of your franchise and deposit agreements.
In the later stages your solicitor will also assist you with dispute resolution, in some cases arbitration and most importantly the inevitable legal proceedings surrounding the termination of a franchise agreement.
Most specialist franchise solicitors are Affiliate Members of the British Franchise Association and generally speaking these are the best to instruct as their experience stems from many years of dealing with the British Franchise Association, Franchisees and Franchisors and their knowledge of franchising is more likely to be up to date than other local solicitors.
There are a large number of franchise guides available today, some for franchisees some for the franchisor.
A franchise guide is basically as it sounds. A guide to franchising ad in the main they are based upon the previous and current experiences others have had of operating a business in the franchise environment.
The British Franchise Association have several guides which can be ordered by visiting their website, www.british-franchise.org.
As you may have already read within the pages of this website many franchise associations exist throughout the international community and in the United Kingdom the British Franchise Association or BFA is our main point of reference and guidance. The British Franchise Association has many different levels of membership, each maintaining a different level of status and in turn, criteria for its members. These are as follows:
BFA Standards and Categories of Membership
Some 190 franchisors have chosen to submit themselves to scrutiny by the association. Their networks encompass some 13,000 successful businesses. The association's criteria demand that all our members, full and associate, meet the following four general objectives:
- Viable: All members of the BFA will have proved in the marketplace that their product or service is saleable, and furthermore saleable at a profit that will support a franchised network.
- Franchiseable: All members of the BFA will have proven they have the means to transfer their know-how to a new operator at arm's length. Most will have done so at their own risk through at least one managed pilot franchise operation.
- Ethical: The BFA has joined with its sister bodies in Europe to devise a new and expanded code of ethics which all members commit themselves to abide by. The code requires standards of conduct in advertising for franchisees and in recruiting and selecting them, and sets minimum conditions for the terms of franchise agreements. Those terms are both critical and complex.
- Disclosure: All BFA members agree that they will, in advance of any lasting contractual agreement, disclose without ambiguity to prospective franchisees the information on their business which is material to the franchise agreement. Members submit their offer documents to the association as part of the accreditation procedure.
With these checks in place on viability, franchisability, ethical and disclosed conduct, franchisors can be admitted to associate membership of the association, providing also that they commit themselves to abide by the Advertising Standards Authority's code of practice and also to the association's own complaints and disciplinary, appeals and re-accreditation rules.
To become full members, franchisors must meet one more objective.
A proven trading and franchising record: The length of time a franchised business has been in operation, and the changes in business and financial circumstances it must have survived before it can be said to be "established" will vary from sector to sector. The record of full members on openings, withdrawals, and failures (if any), as well as their trading and financial performance, is subject to an initial assessment and periodic checks.
New entrants and Provisional Listing
Just because a franchise proposition is new it does not mean that it is necessarily bad - though it may be. The association, therefore, introduced in 1991 a provisional list for the companies new to franchising, who could nevertheless demonstrate that they were taking all reasonable measures to make sure that their business is properly developed and tested for the franchise method.
The BFA's membership criteria have been the subject of consultation with the professional advisers affiliated to the BFA, who provide legal, accountancy banking and other services. The advice of those who are expert, not only in their own field, but also in franchising is vital. Here is another job for the BFA, accrediting the franchise knowledge and experience of its professional affiliates.
(Source: British Franchise Association)
The Ethics of Franchising
Because of the nature of franchising it is important that a set of rules exist to guide franchisors in their operation, The European Code of Ethics for Franchising exists to do just that and all British Franchising Association members are bound to adhere to them.
For a full copy of the European Code of Ethics please visit the BFA website, www.british-franchise.org .