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Franchisor: Why You should Listen to Your Franchisees (and Vice Versa!)

Okay – I understand the situation here. If you are a franchisor, you might have said “what the… ? We are busy putting out fire caused by the franchisees and now you expect us to (cough) listen to them?”

Well, whether you like it or not, your willingness in listening to your franchisees holds the key to a successful franchise network. I can vouch you for that: I was the owner of 2 franchise units. I lost both. The failures were a mix of my false expectations, the economic downturn and the franchisor’s lack of interest in our opinion. Everything is accumulated in such a way that, eventually, the whole franchise company went into bankruptcy.

The main culprit? Broken trust caused by broken communication channel.

Communication is two-way activities

I, was a franchisee, know that we are expected to follow operational guidelines closely. I understand that as a franchisee I should receive directions and follow them closely. However, I work closely with my franchise units – that’s why I know what’s lacking with my business. As a franchisee, I expect my franchisor to listen to me. But I guess I was wrong.

I was having a good relationship with my franchisor – until one day, I fed up with the company’s disinterest to my suggestions. My franchise units were lose making in the past 6 months, and the bottom line was, I ran out of fuel to run the business engine. I decided to closed one location and let the franchisor took over the other.

Everything was not a pleasant experience, as I think my franchisor was arrogant (sorry!) and simply won’t accept the fact that they took part in my business bankruptcy.

But you know what, I am not the only one. Logically, when the majority of franchisees are complaining about how the royalty fees and other fees were strangling them, the franchisor should know that there’s something wrong with the entire system – at least in the communication system.

In just 4 years after I closed down my business, the franchisor was unheard of. Once one of the nations’ top franchises, now they can’t even keep their own units. I admit I smirk at the situation, wanting to tell them “I told you so” but deep down I know that we are all at a loss here. It’s my fault not entering franchising with the right mindset in the first place; it’s my fault I fail to grow my franchise units; however, it’s also my franchisor’s fault not listening to one of their greatest assets – cooperative franchisees like me; it’s their fault not focusing on everyone’s profitability- instead they focus on their own profitability.

How to solve the communication mess

Again, I understand that often franchisees are just out of their mind, demanding something different from what they have signed on the franchise agreement (did they actually read it???) Franchisees often think that franchising is like owning a money tree which offers you a guaranteed success (well, it’s not! It’s just as risky as starting out on your own, you know…)

However, I do expect franchisors to stop being arrogant – stop closing their eyes and ears, pretending not to see and hear the issues experienced by their franchisees.

When you have an open mind – understand why franchisees are panicking, even scolding you – and start communicating, I’m sure your franchise company will win your franchisees – and more.

There are times when things got tangled so badly, in such a way that solving them is a near-impossible feat. When this is what happen with your franchise organization, what you need is a franchise relation committee – a special department whose role is to manage the relationship between the franchisor and its franchisees, moderating communication channels in such a way that things can be solved in professional manners – and in “civilized” ways.

Ivan Widjaya
In franchising, communication is paramount

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One Response to “Franchisor: Why You should Listen to Your Franchisees (and Vice Versa!)”

  • Franchisor and franchisee are like two wheels of the bicycle. Take one away and the cycle will not work. It is in the best interest of both to listen to each other and work towards the common goal of making the overall system better. At the end of the day they both stand to benefit from it.

    Unfortunately, too many franchises have constant argument and fight, which ends up hurting both of them. I had written an article on 5 qualities every franchise must have to succeed. One of the qualities I had highlighted was exactly listening to the franchisees and acting on their reasonable suggestions. Would love to hear your expert opinion on other qualities that make franchise successful – http://www.smallbizviewpoints.com/2010/09/22/5-qualities-to-look-for-in-a-franchise/

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