Disillusioned about Franchising?

Throughout my 20 plus years of experienced in franchising I have taken several sabbaticals. These times of rest away from franchising have been driven by different events in my life and have lasted from just a few weeks to several months. Underlying these times has been a sense of disappointment. Late last year this feeling of discontent was approaching again. I could sense it and see the signs, but this time it was different. For the first time I was more aware of its approach and thus could observe what has happening and why. One day I heard myself say to Bob, my husband and business partner: “I am just disillusioned about franchising, specifically about the franchise relationship.” All of the sudden after those words were expressed, a new understanding arouse.

I had used the perfect word to express my feelings, as well as its causes! That word ‘disillusioned’ was the key.

The dictionary defines ‘disillusion’ as ‘to free or deprive of illusion’. And, I definitely had been under a self-created illusion.  I believed that because the franchise relationship is based on the win-win principle, the parties involved must care ‘first’ about the other party; and, must always seek the win of the other party because it is in the other party’s win that they can find their own.

When the veil of illusion was lifted, I could see that I had created standards impossible to achieve. The problem was in the absolute nature of my belief. The use of the words “must,” “first” and “always” tainted an otherwise true statement.

People in most cases care more about themselves than they do about others. We even see it in the closest of families; so, why on earth would I think that a business relationship would be exempt of this human trait? The franchise relation is dictated by a legal and operational structure that invites more cooperation and more dependency than other business relationships. In more than one way the franchise relation resembles a family. Yet, although it invites cooperation, it cannot make an entrepreneur care more or less about others; nor can it make a franchisee be a better team player. People who are drawn to franchising their businesses, in most cases, feel the pull because of the economic and ego rewards it offers. Very rarely have I heard people express that their main reason for franchising was to help others. That has been my trip, my blind spot, and the cause of my disillusionment. I had created a belief to match my own preferences; and thus, when reality did not match my expectations I felt a sense of discontent and disappointment.

When illusions are lifted one can see, accept, and even appreciate, things as they are. There is nothing wrong with the franchise relationship. There is nothing wrong with franchisors seeking their own gain and franchisees doing the same. That’s just the way it is; these parties are human. The structure of the relationship makes franchisors aware that it’s to their best interest to support franchisees and likewise encourages franchisees to protect their brand and team.

Now that the illusion is gone, I can appreciate the franchise relationship even more for what it is and for what it’s not. In franchising we are dealing with people with their strengths and their weaknesses, and with their humanness. Yet, in franchising people are encouraged to bring their best qualities to the forefront; they have an economic incentive to do so; and when they don’t, they suffer the consequences. Franchisors who don’t support and/or abuse their franchisees experience a shrinking of their network of locations. Franchisees who decide not to follow the franchisor’s system or not to be part of the team have a harder time achieving the success they seek.

Last year’s debate triggered by the CNBC report “Behind the Counter: the Untold Story about Franchising,” in my opinion, resulted in the best of franchising coming forward as franchisees joined the franchisor of Cold Stone Creamery to defend their brand. This is what franchising is all about: the team, the single objective, the win-win. Franchisees and franchisors may have differences; but, like in many families, when an outsider attacks the system or the family, its members unite.

The recent economic downturn definitely has taken its toll and this time franchising was not able to escape it. As many franchisors were not able to respond quickly enough to the economic changes, their franchisees experienced drastic consequences and in many cases failure. Yet, overall, I bet that franchised businesses still have done better than most small independently owned ones.

So, yes, Franchising is not perfect. But, what is?