Benefits of Franchisee Associations

Karen Axelton
Wed, 16 Sep 2009 00:00:00 +0000

When you join a franchise system, should you also join its franchisee association if the company has one?

Joining your franchisee association

A good franchisee association can do many things to help build a stronger franchise. In fact, Robert L. Purvin, Chair and CEO of the American Association of Franchisees and Dealers, believes so strongly in the importance of a good franchisee association to the success of a franchise’s brand that “AAFD only recommends investment in a franchise system that has a strong owners’ association that has been recognized by the franchisor.”

One of the key benefits of a franchisee association, Purvin says, is that “[it] has the ability to represent and protect the interests of franchise owners in a way that individual franchisees do not.” By working on a collective basis through an association, he explains, franchisees can negotiate franchise agreements, as well as influence supplier and marketing programs and their expenses. “Strong associations have valuable vendor and supplier programs that largely pay the cost of membership,” Purvin adds. “[They] also provide mentoring, training and legal support services.”

Alisa Harrison, spokesperson for the International Franchise Association (IFA), says joining a franchisee association can be especially helpful when you’re part of a large franchise system. “As franchise systems grow, as the number of franchisees grows, and as the scale and the scope of operations become more complex, an association can help more franchisees get involved in advertising and purchasing issues and planning on regional and national levels,” she says.

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Some franchise associations work better than others, adds Harrison, who says that a good association will provide for “open and consistent” communication among the franchisor and its franchisees: “To be effective, any forum should be representative of the entire community and allow for unbiased representation.”

“Associations vary widely,” agrees Purvin, “but the best associations are focused on being the voice of the franchisees through a collaborative process with the franchisor management.”

Keep in mind that a franchisee association cannot solve all your problems. “You should not expect all issues and crises to disappear solely because you formed or joined an association,” cautions Purvin. “A [franchise owners’ association] is a tool to attack and address issues, not the solution by itself.”

“Members should expect the association to focus on brand and franchise system matters,” adds Craig Barber, Chair of the Denny’s Franchisee Association. “[They should] not expect the association to be the advocate for specific individual franchise issues with the franchisor.”

Not sure about joining a franchisee association?

If you’re still uncertain about joining your franchisee association, it may help to investigate the history of the organization and why it was founded. Does it focus on negativity and problems? Sometimes, associations are launched by franchisees who are unhappy with their franchise system. “[Associations] that are formed to engage in disputes often do not survive the resolution of the dispute,” Purvin warns.

By contrast, a good franchisee association will focus on the positive, will be forward-looking and will create ample opportunity for franchisees to get involved. “There should be opportunity for engagement and involvement in policy setting,” says Harrison.

To make the association work for you and for everyone in the franchise system, you need take advantage of that opportunity and do your part. “Get involved by joining and actively participating in committees and meetings,” urges Harrison. “Be constructive — everyone is working to build the brand and business.”

Purvin agrees: “Be active, and constantly try to steer the association towards a positive and productive relationship with your franchisor.”

“Members should communicate frequently with the [association] board,” advises Barber. This type of approach helped the Denny’s Franchisee Association members work with the franchisor in adding a gift card program, including a program where gift cards are sold by third-party vendors.

“The negotiation of the legal documents, along with the financial settlement issues associated with the program, were worked through carefully and thoroughly before the franchisees were asked to participate,” Barber says. “The entire franchise community accepted the program and benefited from the hours and expertise of DFA board members who worked diligently for the good of the brand.”

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