Buying a franchise: assess the ongoing operational support

Buying a franchise means joining a network, but you are still running an independent business. You therefore need to know what help the franchisor is actually committed to providing once you are up and running. A promise of “close support” tells you little about who will respond, which issues are covered or what the help will cost. Assess ongoing operational support as a specific service, rather than a general benefit of the brand.

1. Distinguish operational support from training and monitoring

Initial training should prepare you to operate the franchise concept. Operational support should help you deal with questions that arise afterwards. The franchisor’s compliance checks serve a different purpose: making sure you are operating in line with the concept. The same contact person may perform all three roles, but a compliance visit is not automatically an advisory visit.

Ask the franchisor to describe the support provided during a typical year of trading. Focus on practical tasks rather than phrases such as “personal coaching”. Is help available to analyse weak sales, plan workflows, handle customer complaints or improve day-to-day operations? Which issues will you need to resolve yourself with external advisers?

Draw up a simple list with three columns: your needs, the franchisor’s contribution and your own responsibilities. Highlight anything essential to running the business with your current level of experience.

Also ask what regular visits involve. Will your contact simply record instances of non-compliance, or also suggest improvements and follow up on them? This will help you distinguish useful support from oversight intended primarily to maintain consistency across the network.

2. Test availability against your day-to-day needs

An extensive range of support is of limited value if you cannot access it when you need it. Ask about contact channels, support hours and who is responsible for what. If the business opens in the evenings and at weekends, pay particular attention to what happens when head office is closed.

Use a few specific scenarios in your assessment:

• You discover a recurring quality problem and need advice before you next open.
• Sales are falling and you need help identifying possible causes.
• A customer complaint involves the network’s shared procedures and needs urgent attention.
• Your usual contact is absent when an important operational issue arises.

Ask the franchisor to explain who receives each query, who has authority to make decisions and how the issue is escalated if the first contact cannot help.

Distinguish between acknowledgement of receipt, an initial informed response and an actual resolution. A quick automated reply is not the same as useful help. A guaranteed resolution time is not possible for every problem, but you can agree on updates and a clear escalation process.

Also investigate how support will be staffed as more units join the network. Ask how cover is arranged and how ongoing cases are documented. Support should continue to work even when a valued contact leaves.

3. Link the scope of support to the agreement and Swedish law

Sweden’s Act (2006:484) on Franchisors’ Duty to Provide Information requires franchisors to provide clear, understandable written information about the meaning of the agreement and other relevant circumstances well before it is signed. The minimum disclosure requirements include the structure of the business, fees and other financial terms.

However, the Act does not prescribe a set number of advisory hours, visits or response times. It does not guarantee a particular level of operational support. Sweden has no comprehensive franchise-specific legislation, so the agreement and general contract law, including the Swedish Contracts Act, are particularly important in determining the parties’ obligations.

Ask for a specific description of ongoing support in the agreement or in an appendix expressly incorporated into it. This should state:

• which services are included and which are excluded,
• how often scheduled meetings or visits will take place,
• how day-to-day queries are received and followed up,
• which services require a separate order and payment.

Pay particular attention to the difference between wording stating that the franchisor “shall provide” support and that support “may be offered”. These phrases may create different levels of commitment. Ask a lawyer with franchise expertise to assess whether the wording gives you the right to the help you are expecting.

4. Calculate the cost of support that is not included

Ask for prices and ordering terms for additional services. Can travel, site visits or specialist advice be charged separately? Is your approval required before costs are incurred? Also check whether a set number of hours is included and what happens once you have used them up.

Then budget for the help you will need to buy from outside the network. Do not assume that the franchisor’s advice replaces an accountant, employment law advice or other specialist expertise. Support with clearly defined limits may be perfectly adequate, but the cost of everything else must be factored into your decision to buy.

Practical takeaway: Do not buy a vague promise of help. Establish what the support covers, when it is available and what you will pay extra for. That makes the network’s support a part of the offer you can properly assess.