When entering an expert franchise agreement you must pay particular focus on the section on selling requirements. Generally speaking franchisors would like to try secure brand recognition from the assigned master franchise territory (County, State, Country). The franchisor also understands what works great for their enterprize model in attracting new company, and even has probably given careful consideration to how this will likely affect the master’s franchise sales, plus the over-all name brand.
Still, it may be irresponsible to consider that the marketing techniques that has worked in a region or country works the same in another. Indeed, there must be regional variation’ and infrequently the master franchise buyer may have some decent clues about their own territory. What works one place is not going to necessarily work everywhere. Therefore the master territory buyer will have to look into the master agreement and will need to negotiate some changes.
Global Franchise experienced a particularly telling article within their 2016 December issue titled; “Fourteen Questions to get a Master Franchisee Buyer” and also the well written piece noted that master franchise buyers certainly ought to ask themselves; “Who is in charge of advertising within my Territory?” and continued to say: “The master franchise agreement sets forth the parameters of who is in charge of advertising, marketing and related activities. The master franchisee will almost certainly have the obligation to build up and implement an advertising and marketing plan for each territory. The franchisor will either require or reserve the authority to review and approve the marketing plan and then materials used by advertising purposes.”
One thing I had learned in starting master franchises for my business was that what worked in California wouldn’t work so well in Pennsylvania, Texas, Florida, Arizona or Colorado. The weather was different, the culture slightly different, along with the buyers just weren’t always exactly the same types. And mind you, that is all one-country. As I create master agreements far away the regional variation with advertising, branding and marketing got a lot more diverse, understanding that was a a valuable thing too. Had it not, or if I’d forced my master partners to perform things just how I’d always done them, I doubt they may have succeeded or stayed on schedule because they developed their cluster of franchisees to boost our name.
Let’s be realistic, being a franchisor, the hardest situation that could happen could well be for an expert franchisee to travel out of business after which have burned territory plus a tarnished franchise name in that territory. It’s hard to post the pieces when you do. Suffice it to convey it’s better for many concerned when regional variation is inside the mix when it comes to promoting. So, master agreement signers must realize that franchisors ‘get this’ and therefore are often happy to negotiate the terms under these provisions. Think for this.