Franchising: check the franchisee’s operational role

Joining a franchise network does not necessarily mean buying a business you can run remotely. Some models require the owner’s daily involvement; others allow a manager to run the operation. Before choosing a brand, establish which work you will need to do yourself and which tasks you can delegate. An appealing model may be unsuitable if it demands more time than you have available.

Map out the owner’s working day

The first question is not just ‘How much does it cost to join?’ but ‘What will I need to do each week?’ Ask the franchisor to describe both a typical week and a particularly busy one, distinguishing between the launch period and established operations.

Look beyond the hours when the business is open to customers. The work may include preparing the outlet, managing orders, recruiting staff, checking takings, local sales and marketing, and meetings with the franchise network.

Prepare a table with four columns: task, frequency, person responsible and scope for delegation. Include at least:

• opening, closing and overseeing the outlet;
• organising shifts and covering staff absences;
• quality control and handling complaints;
• administration and communication with the franchisor;
• finding customers and building relationships with local businesses.

Ask which tasks the owner actually performs at outlets using the same staffing and management structure proposed for you. An outlet run directly by its founder, with family members helping to manage it, does not automatically prove that the model will work with an employed manager and an absentee investor.

Distinguish business independence from personal obligations

In Italy, franchising is governed by Law No. 129 of 6 May 2004. Article 1 defines the franchisor and franchisee as economically and legally independent parties. This means you join the network as an independent business owner, not as an employee of the franchisor. It does not, however, mean you are free to organise every aspect of the operation as you wish.

The contract may set out attendance requirements, organisational standards and conditions for appointing a manager. The law does not generally require every franchisee to work personally behind the counter: any such commitment must be established by examining the contract and the applicable operating rules.

Article 3 requires the agreement to be in writing, otherwise it is void. Article 4 also requires a complete copy of the contract and the prescribed supporting documents to be provided at least thirty days before signing. Use this time to check, in particular:

• whether the franchisee or a nominated person must be personally present;
• whether there are minimum time commitments or requirements to manage the business directly;
• whether the manager needs the franchisor’s approval;
• what requirements the manager must meet and which duties they may perform;
• how extended absences and replacements are handled.

If you are buying through a company, also establish whether the obligations apply to the company or to a specific individual. A verbal promise that ‘management can be delegated entirely’ is not enough if the contract says otherwise.

Assess the cost of replacing your own labour

The owner’s time has an economic value even when it does not result in an immediate payment from the bank account. An operation that looks financially attractive because you put in many hours yourself may become difficult to sustain once paid staff take over that work.

With your accountant and an employment adviser, compare two arrangements: one involving you every day, and another with an operational manager in charge. Keep the other assumptions as consistent as possible so that you can isolate the effect of delegation.

For the second arrangement, consider not just salary but also employer contributions, holiday entitlement, cover, training and the time needed to recruit the right person. Check who will cover shifts when the manager is unavailable: employing a manager does not automatically remove every need for the owner to step in.

Do not treat your unpaid labour as an inherent advantage of the franchise model. Assigning a notional salary to your work makes it easier to compare brands that require different levels of personal involvement, without confusing the return on your investment with payment for your labour.

Agree on delegation arrangements that work in practice

Before signing, ask for the essential conditions governing delegated management to be clarified in writing. If the franchisor’s approval is required, seek objective criteria and a procedure that works with the business’s operational needs, and have your lawyer review them.

Define who will be able to access management systems, receive communications, attend meetings and coordinate employees. Also clarify which decisions will remain yours: delegating day-to-day work does not automatically transfer your responsibilities for the business to the franchisor or manager.

Finally, test three practical scenarios: your sudden absence, the manager’s resignation and a particularly busy period. If you do not know who will keep the business running, the arrangements are not yet ready.

In practice: choose a brand only after aligning three things: the role required by the contract, the time you can realistically commit and the cost of the people needed to replace you.