What can trigger a negative remark for your business, when you are particularly dealing with franchisees? The thing is lack of stocks and poor logistics. When a business expands through its own investments, the scope of getting answerable to someone else limits. As with company-owned outlets, one expands when there is enough investments to run additional outlets, as well as a stable manufacturing unit to continue further stock supplies.
However, when a franchisee invests in a brand for opening its outlet in any particular location, then franchisor is liable to follow some basic rules. It is providing essential training and support needed to run an outlet. As franchisees are not only investing money, they are investing their entrepreneurial dream, which is to build a sustainable business.
To run a franchise business there are some vital ingredient that are mandatory. These are brand’s trademarked logo, colour, interiors, and products. These are the materials which are provided as to support a business at an initial level. To make it organise properly and accurately, franchisor offers training to the employees of that franchised outlet as per their customs, which is subsequently followed by marketing and promotional services. This is how a franchise system runs.
There are many businesses today that are willing to adopt franchising as an expansion mode. For them, it is urgent to look at the support capability of its company before jumping to any decision. Firms under categories such as pharmaceuticals, FMGC, retails are bounded by stocks and expiry dates. They require a continuous supply of products according to market trends, expirations, and high demands. This means that signing too many franchisees at a time with limited production is a troubled decision.
Lack of supply and poor logistic operations can depress the name of a brand. A franchisee who will suffer loss due to such glitches will blame to the parent company. The serious grievances like that can hence shut the scope of franchising before its launch, in the market.
Not only there will be unhappy franchisees, but customers will view the brand incapable due to insufficient supplies. For a customer today, it is not difficult to switch from one brand to another, due to wholesome penetration of competition in same segment. Therefore, it is utter important to sustain the credibility of each outlet running of a brand, any part of geographical location.
While maintaining the supply from the production unit, it is also necessary to track the supplies carefully. Each product has different shelf life and it is sensible to understand that, before selecting the mode of delivery. Delivering stale products, in terms of fashion and usage, will only worsen the reputation of a brand than not keeping any. While on the other side, delivering products on time and checking whether there is any adultery happening in between, is also a responsibility of the parent company.
Franchising should not be taken for granted when it comes to linking chords with franchisees. If you are targeting a certain number of franchised outlets it must be followed by researching the potential of manufacturing and logistics, from beneath, of a company.
If you are not having an organised way of supplying, then franchise networking can steal a major share of goodwill out of your company’s name. Be prepared prior having extra outlets for your business.