Purpose of a Franchise Operations Manual (Part One)

Before working with a new client, I think it’s a great exercise to review the functions of a Franchise Operations Manual. Over the next couple of days, I’ll review the main functions of a Franchise Operations Manual because it serves four main purposes.

First, the Franchise Operations Manual is the authority document of the franchise System Standards. The System Standards are the standard procedures that a franchisor requires of all franchisees in order to duplicate the customer experience in every location. The customer experience is the driving force behind profitability. If you can duplicate a favorable customer experience, then you may have a business that you can franchise. If you have a well prepared Franchise Agreement, it should refer to the Franchise Operations Manual as the System Standard. This way, as your system grows and your System Standards change, you only have to update the manual instead of updating the Franchise Agreement.

Second, the Franchise Operations Manual is the most effective tool for protecting your Brand. A company’s Brand is one of its most valuable assets. The Brand is also the asset that is at most risk when a company decides to franchise. When you franchise a concept, you are putting your Brand in the hands of other people, all of whom likely have different ideas about the best direction for the company. A properly prepared Franchise Operations Manual, with well defined and organized System Standards, will be the only tool you have to manage the Brand and control the franchisees when they try to act on their vision for what is best for your Brand.

I’ll conclude with Part Two tomorrow.