Mandate Participation In Operations

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Who is going to operate the franchise business?

Mandate Participation In Operations

Who do you want running your franchise businesses? There's a wide range of commitment between a manager and an owner. Owners have a vested interest in seeing the business succeed. Managers may, or may not, depending on how the business is structured and what the reward system is.

One of the things you, as the franchisor, can do is specify who has to participate in the actual operation of the business, and to what extent. Item 15 of the Uniform Franchise Offering Circular (UFOC) allows you to state whom the principal operator must be and whether his effort in the active management and operation of the business is full or part-time.

You can also require that any managers other than the principal have to complete your training program and be approved by you. While these are important considerations, be careful you do not specify so much that you'll be spending all your time reviewing and approving managerial changes at the franchisee's business.



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