Frequently Asked Questions
Question: Do I need previous experience in business to buy a franchise?
Answered by Matthew O'Neil, Franchise Sales Director of Snack-in-the-Box
"In short the answer is no. A good franchisor should provide you with all of the necessary tools to make your business a success. The whole essence of good and ethical franchising is that the franchisor teaches and trains the franchise owner in all aspects of running the business. A good franchisor will also cover the basics, such as VAT, how to run your accounts and how to deal with people on a daily basis.
When buying a franchise, make sure that the franchisor's support doesn't end the week after your head office training. You want to be confident that they will provide ongoing support after the initial training period but most importantly that this will continue throughout the launch of the business and during the whole term of your franchise.
Never forget that franchising is a two-way partnership. So your franchisor will be looking for you to provide something too. They will want you to have enthusiasm for the project, the motivation to get up and make your business work and stick-ability. All new business owners have to go through the pain of a learning curve, but your franchisor should be there to help you and soften the experience.
Finally, your franchisor won't want you to try and re-invent the wheel - after all that is the reason why you are buying a franchise in the first place. However, they will want you to follow their recipe for success. It's a bit like baking a cake. If you follow the recipe from the Master Chef, the cake will turn out to be fabulous. If you decide that you know better and leave out a few of the ingredients or add some of your own, you can only expect the cake to be a disaster."
Question: What is a franchise?
Answered by Gary Clere, Managing Director of Cargocall
"Obviously the word 'franchise' can mean slightly different things to different people but to me it means 'partnership under licence' - multiple business entities working under one banner (the brand) for a common cause but having clear lines of demarcation.
It is very important to keep the 'partnership' ethos strong within a franchise network as this is something I see as being vital to ensuring the network is dynamic and engaged. This also gives a sense of belonging to the franchise owner and ensures the franchisor is highly focused on the well-being of each franchise.
For the franchise owner it is important they do not feel isolated or lacking support and for the franchisor they need to see their business system being followed and their brand treated with respect.
I see these two needs encapsulated in the term "partnership under licence" or as we say, franchising."
Question: What support will the franchisor give me with regards to managing staff and employment law?
Answered by Nicholas J Cooper, Managing Director of Northwood
"Recruitment plays a hugely important role in the success or failure of a business and getting the right staff, with the right experience and credentials doing the right job is critical to a company's success, so a franchisor will usually provide training on recruitment selection and staff management.
At Northwood we help our franchise owners to identify suitable candidates by providing job profiles. We even review CVs and attend initial interviews. Once a candidate is selected we advocate using employment screening as a way of verifying their credentials and qualifications. In a recent Mori Poll over 71 per cent of candidates admitted to lying on their CVs.
We provide the franchise owners' staff with ongoing training and have systems for future performance management. We advocate the use of outsourced employment law specialists who, at discounted rates provide the reassurance that all current and future employment laws are being adhered to."
Question: Can a company offer a franchise without protecting their trade mark?
Answered by Jonathan Chadd, Head of Franchising Team, Leathes Prior Solicitors
"While it is always very much better for any business, and in particular a franchised business, to have its trademark protected by registration, it is not essential that registration is secured.
The franchisor will still have rights in an (unregistered) trademark acquired through prior use and these may include copyright in any logo or design which forms part of the trademark and rights enforceable by a "passing off" action before the High Court.
Where a trademark is registered, the use of it - both by the proprietor (franchisor) and the franchise owners who are licensed to use it - is that much more secure and the risk of any third party challenging the franchise network's right to use the trademark is significantly reduced.
The position, put simply, is that while it is always preferable for a franchisor to secure by registration its rights to its trademark, the fact that it has not done so is not, of itself, a bar to it franchising under that name.
Any franchise owner should, however, be aware that without the protection of registration, there is a greater risk of its right to use the trademark being challenged and of the brand having to be changed at a later date if any other party establishes rights in it. For that reason the franchisor should always try to secure registration at the earliest possible date."
Question: What is the main advantage to the franchisor calling their franchisees 'franchise owners'?
Answered by Pam Bader, MOLLY MAID
At MOLLY MAID we are proud that our franchise owners have full ownership of their business and therefore are in control of their own destiny. The very word 'owner' gives the notion of empowerment, responsibility and accountability to their staff as well as to the business and takes into account that their every action has a direct impact on their business.
As franchise owners they are not only 'owners' of their own business but as part of the MOLLY MAID network they are our strategic partners whom we, as franchisor, coach and support to help them build successful businesses.
Question: "Is there an organisation that can report on the status of the franchisor and their track record in helping their Franchise owners to succeed?"
Answered by Godfrey Lancashire, Managing Director London House International Ltd
I would encourage any potential franchise owner to invest their time and energy in doing due diligence at the outset and really getting to know their potential franchisor very well before any commitment. I believe there are four groups who can help with this.
Most good entrepreneurs would welcome the comfort of a respected and professional trade association for their industry. The bfa is world renowned for credibility and support to franchising in the UK and most franchisors would certainly be members of the bfa. The bfa then is the first port of call to confirm how long the franchisor has been trading, do they have full or associate membership and are they credible in the UK marketplace.
Franchise Development Services
In my view, Franchise Development Services gives excellent impartial advice to franchisor and franchise owner alike. They are highly respected, have been in business for 28 years and Roy Seaman and his team of regional consultants certainly know their business and the market place. Their knowledge would prove invaluable.
Don't miss the obvious. It is essential that potential Franchise owners speak to existing franchise owners who are already operating for the chosen franchisor. Do not be fooled by being offered a small selected list, make sure the Franchisor invites you to telephone any of their franchise owners of your choosing.
Ask what works well and what doesn't, what are the pitfalls and how much real support and help they get from the franchisor. Are there seminars, are there regular visits to franchise owners, is there a help desk, is there out-of-hours support and, of course, the key question to an existing franchise owner "if you had your time over again, would you still have joined the franchisor?"
London House International
We are the UK's leading investigation company and for many of our corporate and consumer clients we carry out due diligence, pre-contract, getting to the truth behind CVs, helping clients get to know potential business partners, understanding the truth behind the balance sheet and the real numbers. With 60 franchised territories UK-wide, we are able to offer this expertise nationally at little cost.