A new approach to franchises is gathering sway that treats the relationship less like a ‘master and servant’ set-up and more like a marriage of equal sides. Giving franchisees more input can have its pitfalls, but brands are finding the benefits far outweigh the negatives. By MaryLou Costa
Relationships between brands and franchisees are a little like marriages. They take patience, understanding and, above all, communication. Accordingly, franchisees are now being treated by brands as business partners rather than as subservient employees. To make sure the partnership is productive, franchisees must receive clear communication from the central brand when new initiatives arise, and have a voice in the marketing and product strategy.
But as with all partnerships, a breakdown in communications can lead to conflict which in the case of franchises, can put the brand at risk. In the US, the franchisees of KFC have been making headlines since January, when they filed a lawsuit against the company. They claim that KFC management has gone against franchisees’ concerns that its new grilled chicken product didn’t warrant so much of the company’s advertising budget, forsaking promotion of its core fried chicken products. They sought an injunction to protect their rights around their input into marketing decisions. Continue reading this article…