What Makes a Good Franchisor Good in NZ?

In Short

• A good franchisor has well-established operations, providing clear processes for franchisees.

• They ensure uniformity across the franchise network, maintaining consistency in quality and service.

• Effective communication, ongoing support, and a strong marketing strategy are key traits of a successful franchisor.

Tips for Businesses

When looking for a franchisor to partner with, focus on their ability to provide strong operations, consistent quality, and effective communication. A franchisor should offer ongoing support and mentorship, guide franchisees in local marketing, and ensure the success of the franchise network through clear, strategic direction.

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Table of Contents

• 1. Effective Operations
• 2. Values Uniformity
• 3. Good Communication 
• 4. Provides Ongoing Support 
• 5. Marketing-Focused
• Key Takeaways
• Frequently Asked Questions 

Franchise agreements last for several years and require a substantial financial investment. As such, prospective franchisees searching for a good franchising opportunity should look for a franchisor they feel supported by and can trust. This article will take you through six traits that indicate whether a franchisor is good to work with.

1. Effective Operations

The most critical element that makes a franchisor good is having well-established business operations. Access to a franchise’s business systems and processes is why someone would join a franchise network instead of opening their own business. The operations manual will outline these processes.  

This document essentially sets out the roadmap that helps new franchisees succeed. It will cover everything that the franchisee needs to know about the business, including details on: 

• day-to-day operational processes;
• goods and services offered;
• compliance information; and
• marketing and advertising. 

2. Values Uniformity

Franchisees should look for a franchisor that ensures consistency across the franchise network. One of the reasons customers like franchises is because they know what they can expect from them. For example, a customer can walk into a McDonald’s in multiple locations and expect to find the same goods and services of the same quality.

The franchisor can ensure uniformity by having effective training and a well-developed operations manual to ensure that all branches operate similarly. The franchisor should also do regular quality assurance checks to ensure all branches maintain the same standards. A franchisor who fails to ensure consistency across the franchise network is letting down the franchisees who maintain high standards.

3. Good Communication 

It is critical for the success of a franchise that the franchisor be an effective communicator. This is because franchisors must keep franchisees updated about changes that might affect their business. 

Similarly, a franchisor should recognise that communication is a two-way street. Franchisees need to be able to reach out to share ideas or concerns with the franchisor before they escalate. As such, a franchisor should establish clear lines of communication with its network. This might include:

• regularly hosting events for franchisees to attend;
• routinely checking in on each franchise location; or
• sending out network-wide communications, such as newsletters.

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4. Provides Ongoing Support 

Maintaining the franchisor and franchisee relationship requires continuous work. Therefore, most franchisors will provide new franchisees with initial training to help them commence business operations. 

However, a franchisor will be desirable to work with if they take steps to assist their franchisees beyond initial training. For example, this includes providing:

• ongoing support through check-ins;
• mentorship;  
• training materials; and
• networking opportunities. 

5. Marketing-Focused

A good marketing strategy is the cornerstone of every successful franchise brand. All franchise networks should have advertising campaigns and promotional activities to drive customers to all locations. This might include:

• email marketing;
• social media marketing; 
• search engine optimisation;
• offline marketing campaigns, such as TV and radio ads;
• pay-per-click advertisements; and
• public relations activities. 

Franchisees must also use localised marketing strategies to appeal to their local customers. A good franchisor will guide its franchisees to develop local marketing strategies and campaigns.

Key Takeaways

A positive franchisor-franchisee relationship is vital for the success of a franchise. As such, franchisees searching for a franchising opportunity should seek a franchisor capable of providing them with the support they need. Some key traits that make a franchisor good to work with include a franchisor that:

• has effective operations;
• values uniformity;
• is a good communicator;
• provides ongoing support;
• is marketing-focused; and
• provides a personalised experience for their franchisees. 

If you need assistance deciding if a New Zealand franchise opportunity is right for you, 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