Franchising in Belarus: how to assess quality requirements

An attractive product in a presentation does not necessarily mean you can reproduce it consistently at your outlet. Before buying a franchise, you need to understand the quality you must deliver, how the franchisor defines it and what it costs to meet the requirements day to day. Across a franchise network, the shared reputation depends on every operator, so vague promises to ‘meet the brand’s standards’ should be translated into clear specifications and working procedures before you commit.

What Belarusian law requires

In Belarus, franchising relationships are specifically governed by Chapter 53 of the Civil Code. The legal term for the agreement is a ‘comprehensive business licence agreement (franchising)’. The rights holder grants the user, meaning the franchisee, a package of rights to carry on a particular business activity.

Article 910-4 of the Civil Code requires the franchisee to ensure that the quality of the goods produced, work performed and services provided is no lower than that of the franchisor’s equivalent goods, work and services. This is a mandatory requirement: the parties cannot simply state in the agreement that a new outlet may operate to a lower standard.

However, the wording of the law is no substitute for a description of the specific outcome required. The relevant characteristics for a bakery will differ from those for an appliance repair business. A prospective franchisee needs to establish which of the franchisor’s goods or services serve as the benchmark and which documents substantiate it.

Under Article 910-3 of the Civil Code, the franchisor must provide the technical and commercial documentation needed to use the licensed package of rights, and instruct the franchisee and their employees. However, you should not wait until signing to discover requirements that could change the financial viability of the project. Ask for the information that materially affects your calculations during negotiations, under confidentiality arrangements if necessary.

How to turn a promise of quality into a clear benchmark

Ask for a list of specifications for the core product or service. The document should help employees reproduce the required result and allow a prospective franchisee to assess the resources needed. Photographs, promotional descriptions and phrases such as ‘premium service’ are not enough.

For each key product or service, examine four elements:

• Outcome: exactly what the customer should receive, including all required components, appearance and functional properties.
• Acceptable variations: which differences are permissible and which constitute a failure to meet the requirements.
• Assessment method: measurement, testing, a reference sample, a production specification or a clearly defined service scenario.
• Conditions for reproducing the result: the equipment, staff qualifications, materials and time required.

For example, a promise of ‘fast service’ does not explain how to organise a shift. Clarify when the clock starts, whether complex orders are taken into account and what performance is expected at peak times. This is not a suggestion to impose universal targets: the measures should suit the particular business format.

Ask to see not only a successful example, but also typical failures to meet the standards, with explanations of their causes. This makes it easier to identify where you might need an additional workstation, a more experienced employee or extra time. Separately, establish which specifications are brand standards and which arise from mandatory legal requirements for the goods or services concerned. One does not replace the other.

How to check whether quality is achievable and what it costs

Before buying, it is useful to observe the day-to-day operation of an outlet comparable to the one you plan to open. Arrange the visit with the franchisor and the outlet’s operator. A staged demonstration during a quiet period is less informative than normal operations under a typical workload: you need to see whether the result can be maintained without constant intervention from a manager.

Create a table with the headings ‘requirement — resource — cost — evidence’. Against each specification, record what is needed to meet it. For example, product consistency may depend on equipment adjustments, while consistent advice may require a specialist with particular qualifications.

Include not only the initial investment but also ongoing costs:

• servicing, adjusting and carrying out necessary checks on equipment;
• consumables for trial runs;
• write-offs of products that fail to meet the requirements;
• repeating work and correcting defects;
• staff time spent on preparation and internal quality checks.

Do not insert an arbitrary allowance for wastage without an explanation. Ask the franchisor to justify the assumptions, and substantiate your own costs with quotations from local suppliers and staffing cost calculations. If data is not yet available, mark the item as uncertain and test several scenarios.

Pay particular attention to any dependence on a specific specialist. If the result relies on one experienced practitioner, the financial model should allow for replacing them and for the additional time a new employee will need to get up to speed. For a buyer, this is a question of whether the franchise model can be replicated, not just a recruitment issue.

What to agree before signing the contract

Agree on the list of documents that define quality, their versions and how they will be supplied. The agreement should make clear which requirements apply to your particular format. A reference to unspecified ‘network rules’ does not allow you to assess your obligations in advance.

It is also useful to agree on a process for resolving, in writing, any inconsistencies between a production specification, a reference sample and an instruction. Uncertainty should be resolved before goods are produced or services delivered, rather than after a problem arises. If a locally sourced substitute for a material or piece of equipment is proposed, establish a way to confirm that it will maintain the required result.

Franchise agreements and amendments to them must be registered with the National Centre of Intellectual Property. This requirement is set out in Resolution No. 346 of the Council of Ministers of the Republic of Belarus, dated 21 March 2009. Where agreed specifications are formalised as an amendment to the agreement, allow for the relevant procedure. Registration does not, however, confirm that the standards are financially achievable at your outlet — the buyer must arrange that assessment separately.

Practical takeaway: before buying, obtain a clear quality benchmark, check whether you can reproduce it and calculate the resources required. If the required outcome cannot be explained, demonstrated and budgeted for, it is too early to commit to buying the franchise.