Training Before Franchising Your Business in the Philippines

Running your own shop well is not enough. Before franchising your business, you need to pass on your knowledge to someone who was not involved in setting it up. A clear training programme bridges the gap between your personal expertise and a new partner’s ability to run the business. In franchising, readiness needs to be assessed before opening—not after complaints or losses arise.

1. Identify what each role needs to learn

Start with this question: what should your partner be able to do without calling you at every step? Provide separate training for the owner, manager and staff. Their responsibilities differ, so a single explanation for everyone is not enough.

For the franchise owner, prioritise financial management, interpreting reports, recruitment and meeting their obligations. For the manager, focus on scheduling, stock control, quality and handling complaints. For staff, emphasise correct working practices and safe service.

Create a checklist with four sections:

• Task: the specific job that needs to be carried out.
• Standard: the acceptable result and any errors that cannot be overlooked.
• Evidence: a practical demonstration, report or test.
• Assessor: the person authorised to confirm readiness.

For example, “understands stock control” is not enough. A clearer description is “can count remaining stock, record discrepancies and explain when to reorder”. This makes expectations specific and assessment fairer.

2. Teach through hands-on work

Arrange training around the actual sequence of work: preparing to open, serving customers, dealing with problems and closing. Demonstrate the task first, let the trainee carry it out, then provide feedback. Do not make the programme a series of lectures.

Use your existing business as a training venue, but assign someone to focus on teaching. A good manager is not automatically a good trainer. They need to explain the reasons behind each process, spot mistakes and give clear guidance on correcting them.

Include situations that do not arise every day:

• A delayed delivery of a key ingredient or product.
• A mismatch between cash takings and sales records.
• A complaint requiring an immediate decision.
• Equipment failure or loss of connectivity.

In every exercise, make clear which decisions the partner can make and when they need to seek help. Do not use real customers’ sensitive data when a fictional example will suffice.

Also try handing the training over to another trainer. If you are the only person who can explain things clearly, expansion still depends on you.

3. Set out your training commitments in the agreement

The Philippines has no single comprehensive law covering every aspect of franchising. However, this does not mean there are no specific regulations. Executive Order No. 169, series of 2022, is important for franchise agreements involving micro, small and medium enterprises, or MSMEs.

The minimum content required for agreements covered by the order includes full disclosure of both parties’ rights and obligations, as well as details of the assistance to be provided. Promised training and support should therefore be clearly set out in writing, rather than left to verbal discussions. The order also directs the Department of Trade and Industry (DTI) to create a register of covered agreements; confirm the current procedure and applicable rules with the DTI.

The Civil Code also applies to obligations and contracts, while the Intellectual Property Code applies to the use of trade marks and protected know-how. Have a lawyer review the agreement and its related schedules.

Specify who will be trained, where training will take place, which costs each party will cover and what happens if the required standard is not met. Include a policy for training replacement managers. Avoid promising “unlimited support” if you do not have the staff and funding to deliver it.

4. Set pre-opening standards and provide support afterwards

Attendance does not equal readiness. Before opening, ask your partner to carry out essential tasks without guidance. Record the results, areas for improvement and the date for reassessment. Where shortcomings affect safety, do not press ahead with opening simply because the launch date has been set.

After opening, arrange regular check-ins and establish a clear way to request help. Distinguish urgent problems from routine questions. Specify who will respond, the expected response time and the next steps if a problem cannot be resolved promptly.

Use recurring questions to improve your training. Mistakes may stem from unclear explanations rather than a lack of effort.

Practical summary: Before taking on a franchise partner, prepare a skills checklist, practical assessments and written support commitments. Your training is ready when others can do the job correctly—even when you are not there beside them.