It is natural for your franchise to evolve over time. Consequently, you may need to implement system-wide changes to your operations from time to time to improve or maintain your system or implement new products or services. However, regardless of the change you implement, you should understand how to communicate and implement operational changes in your franchise network to minimise disruption and any disputes. This article will take you through six tips for introducing operational changes to your New Zealand franchise.
Research the Proposed Change
You should conduct thorough research before introducing any operational changes to your franchise. It is important not to rush the research stage. The long-term success of these operational changes depends on ensuring you fully understand the context for any changes.
For example, take the time to assess if you have the resources needed to implement such a change. This includes having:
- the right team to oversee the implementation of the change;
- sufficient funds to cover the costs associated; and
- enough time to roll out the change.
By carefully assessing these factors, you will better understand the likely impact of a proposed system change before rolling out the developments across your franchise network. In addition, this step can help avoid disputes while franchisees adjust by being able to explain and demonstrate the process and costs to franchisees.
Conduct Testing
Consider testing the change on a smaller scale. Testing will help you reduce any negative impacts of a proposed system change. This is because it will show you any potential consequences of wide-scale implementation. Accordingly, you will have the perspective to make any necessary amendments before launching the change across the entire network.
Further, testing will provide you with tangible evidence of the benefits of your change. You can then use this information to market the change to your franchisees and help make the transition process more manageable.
Unfortunately, testing every operational change on a broad scale is not possible. If this is the case, you should carefully analyse the anticipated results of the change and have a report ready to present to franchisees.
Continue reading this article below the formConsult Your Franchisees
It is good practice to discuss any proposed changes with your franchisees before rolling them out. The process of consulting your franchisees will differ depending on the size of your franchise network.
If you have a small number of franchisees, you may be able to collect feedback from every branch. On the other hand, if you have an extensive franchise network, it may be more appropriate to consult a smaller group of franchisees.
Consulting your franchisees will have several benefits. Firstly, franchisees can provide valuable insights into whether the proposed change fits with the franchise’s day-to-day operations. This feedback will be essential to make any necessary adjustments to ensure the operational change is correctly implemented. Secondly, consulting with your franchisees will make gaining their support for a change easier. This allows franchisees to feel like they have some representation and will make it easier for them to accept the change.
Communicating the Change
You should notify your franchisees of any upcoming changes as soon as practicable. One way to do this is proactively involving franchisees in planning and implementation.
Providing your franchisees with plenty of notice of any upcoming changes will ensure that they:
- have the opportunity to ask questions about the implementation process;
- prepare their business for the new changes; and
- are less likely to feel any time or financial restraints.
Overall, the more notice you can provide, the better your franchisees will receive the changes. Moreover, the more significant the change, the more time to be provided to the franchisees to implement the change.
Update Your Operations Manual
Significantly, you must update your operational manual to incorporate any changes you make. Additionally, you should provide the updated version of the operations manual to your franchise network as soon as possible. Doing this ensures they have time to adjust to any operational amendments. Further, updating the operations manual will formalise this change, which can be helpful if any disagreements arise.
You should also consult a franchise lawyer to ensure that the proposed change does not conflict with or breach the terms of the franchise agreement.
Expect Conflict
Finally, you must anticipate pushback on any changes you propose. It is impossible to please everyone. Therefore, it is natural that some franchisees will be less than satisfied with your proposal. For example, a franchisor may generally remove certain products that are not popular throughout the franchise network. However, some products or services may be more prevalent in some territories than others, so those franchisees may be unhappy at their removal.
However, you can minimise conflict by being deliberate with your changes and involving your franchisees in the process as much as possible. Furthermore, you could explain that it is for the benefit of the franchise network, generally based on your research and testing.
This publication provides you with the fundamentals for franchising your New Zealand business, including set up, branding and management.
Key Takeaways
Naturally, you will change some of your operations to improve or maintain the performance of your franchise system over time. However, you must understand how to communicate such operational changes to your franchise network to minimise dissatisfaction and disputes. Some key tips for introducing operational changes include:
- research the proposed change;
- conduct testing;
- consult your franchisees;
- notify franchisees of any upcoming changes;
- update your operations manual; and
- expect conflict.
If you need assistance introducing operational changes to your New Zealand franchise, our experienced franchise lawyers can assist as part of our LegalVision membership. For a low monthly fee, you will have unlimited access to lawyers to answer your questions and draft and review your documents. Call us today on 0800 005 570 or visit our membership page.
Frequently Asked Questions
It would help if you discussed any proposed changes with your franchisees before rolling them out. This will provide valuable insights into how well the proposed change fits the franchise’s operations. Consulting your franchisees will also make gaining support for a change easier by ensuring they feel represented.
An operations manual contains all the relevant information a franchisee needs to operate a business as part of your franchise network. This manual details goods and services, technologies, suppliers and customer service. You must update your operational manual to incorporate any system-wide changes.
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