Franchising is proven to be one of the safer and more lucrative business models when compared to other SMBs, which are started out by individual business owners as startups. It’s no wonder then that franchise operation manuals are guarded so well by franchisors. They’re literally worth gold. Franchise manuals often contain the secrets of a franchise’s success and they tend to be protected by various legal agreements until the final franchise agreement is signed. Seeing that this document is so valuable, it’s worth putting time and effort into creating it. So, if you’re wondering how to write a franchise operations manual, stick with us and find out!
Table of contents:
The secrets of how to write a franchise manual
Any successful franchise manual will start out with an outline. This is where you start brainstorming and putting all your ideas down on paper (or a laptop, if that’s easier). Your outline will contain all the important details you will want your franchisee to know about your business. The best thing to do is to start writing ideas as they come to you and continue writing them down over several days and even weeks until you feel you’ve covered all the important aspects related to your franchise business. Once done, you’ll be able to create your manual by organising your ideas in a clear and methodical way. (For more on this, see the Operational details section below).
The language of your franchise operations manual is also uber important. Remember, this is not a marketing piece of content where you use friendly terms and lighthearted language. You need to be as precise as possible as you’re essentially creating a legal document, which sets out both parties’ rights and responsibilities. In essence, keep it short and concise where you can, but don’t worry about needing to spell out other, more complicated details. It’s better that your franchisee understands what you mean from the first read, rather than having to come back to you with a hundred questions later. This will save both parties valuable time.
It’s important to protect yourself legally, too. After all, you don’t want someone to use your franchise manual, your secrets of success or your profitable business model to start up something on their own based on your hard work. This is why your franchise operations manual should usually be presented to a franchisee once they’ve signed a legal agreement with you regarding confidentiality and non-disclosure and also after the franchise agreement has been signed. Another step in protecting yourself along this point is to have your franchise operations manual checked by a legal eye before you hand it out to others.
All the brainstorming that you did in the Outline step above will ultimately boil down to the following few elements, which should form the crux of your franchise operations manual.
Franchisor/franchisee relationship: this is where you outline the rights and responsibilities as well as duties of both sides to the agreement. Outlining the nature of the relationship including the profit-sharing model, royalties, the actual carrying out of the services (if your franchise is service based) or the sale of products and other similar factors need to be put in writing. The location of where the services will be carried out by the franchisee should also be predefined.
Business processes and procedures: business processes and procedures could very well make the bulk of your franchise operations manual because they require thoroughness and depth. These are crucial in order to avoid inconsistencies across different franchisees, ensuring that each franchisee provides clients with services to the right standards you’ve set out.
Brand identity: a business’ brand identity is something by which it is recognised by its customers and potential customers on the market. A brand identity contains trademarked logos and slogans or taglines, visuals and images as well as a brand voice. There needs to be consistency in your brand identity across all franchisees that work for you and spelling this out in your franchise operations manual is another key component of ensuring that it helps the franchisee know what to expect and what to deliver.
HR technicalities: hiring staff is one thing, retaining staff is another. Also, ensuring that your staff carry out the service to the highest possible franchise standards is crucial. Staffing and recruiting can be difficult, especially if you need to get the right type of cadre for the job with a specific skills and knowledge set. Therefore, consider spelling out your recruitment policy in great detail so that you hire the right people, retain them, are able to train them on an ongoing basis and consider steps for disciplinary actions, as these may arise at some point in the future and it’s better that you’re prepared for a worst-case scenario as opposed to playing it by ear.
Health and safety rules and regulations: depending on the nature of your franchise business, you will also need to ensure that your franchisee is certified according to industry regulations as well as follows and abides by health and safety rules set out by the government bodies and local municipalities. Non-compliance with these can tarnish a franchise’s reputation and it is crucial your franchisee is covered from all possible angles.
Financial management details and systems: this is a big one. This is where you’ll share with the franchisee your past, current, projected and anticipated financial results as part of your relationship with them, provide for accurate financial management, share the systems you have in place for financial monitoring and compliance and other relevant details. This is an important one when it comes to confidentiality and the Legalities section above will come in handy at this point.
Monitoring: ongoing monitoring of how the franchisee performs their duties in terms of their responsibilities as outlined in point one above is crucial for a successful relationship. Monitoring can take several shapes – from financial monitoring to the implementation and carrying out of services that require industry compliance and compliance with the standards of the parent franchise.
Complaints management: unfortunately, it does happen that some clients are displeased with a service that they’ve received from your franchisee and this is where you need to put in place proper procedures for how complaints and disputes are handled. From regular monitoring on social media to ensuring you have the right insurance cover for a legal claim against you – these elements are essential.
Marketing: one of the franchisor’s main responsibilities in the franchisor-franchisee relationship is marketing. Marketing should essentially always be carried out with the brand identity of the franchise in mind, sticking to a consistent tone of voice, using a consistent set of images all while staying within the boundaries of the brand identity. Franchisees who wish to market themselves will need to be aware of these factors so that they adhere to the franchise’s brand identity in a consistent way.
Your franchise is an extremely valuable asset that you need to protect. You already know the importance of vetting potential franchisees and this element of caution should help you protect your business further down the road. As you sit down to start writing your franchise operations manual, a crucial document for both franchisor and franchisee, consider its outline, the language used and the legalities behind it.
Once you’re ready to start drafting, break down the main components into separate sections and consider using flow charts, bullet points and shorter sentences to ensure that your points are clear and easy to understand. This will not only save you time answering questions that could have been covered in the manual itself, but will also ultimately help you make more money.
The clearer your franchise manual is, the better the relationship with your franchisee and the more profitable you can expect to be. To see an example of a franchise manual template pdf, check out an awesome template that we’ve prepared to help you get started here.