How the Franchisor/Franchisee dynamic has changed

franchisee agreement

Elana Koral, founder of Franchise Coaches and a co-sponsor of FASA’s Franchising in Africa conference held in August shared interesting insights into the franchisor/franchisee dynamic. “The franchisor/franchisee relationship is like a tug of war,” says Elana “with a power struggle between the franchisor and the franchisee in achieving their respective goals. It’s because one party has naturally more power and more control than the other – with the franchisor holding the intellectual property and the goodwill so naturally they are in a stronger position within the relationship.”

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Could this be why you are not recruiting franchisees?


What can we do to recruit franchisees is a question the Association is asked daily. What do you do when you’ve done all the right marketing but still not getting buyers to sign on the dotted line? You continue with your marketing efforts while at the same time taking a step back to evaluate everything in your business.

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How store revamps can boost a franchise brand – setting the record straight

Renovating a store

In response to the article, Are Franchisors undermining their franchisees with unreasonable demands? that focused on the challenges that face franchisees in these trying times when their franchisors impose unreasonable expenses such as store re-vamps in accordance with their contracts, Tony Da Fonseca, MD of the OBC Group and immediate past chairman of FASA sets the record straight and shows how revamps, done the right way, can have positive results for all.

“As a franchisor who takes his role seriously, I was slightly taken aback when reading an article that appeared in a recent edition of the FASA newsletter. Flighted under the heading, “Are franchisors undermining their franchisees with unreasonable demands?” It implies that franchisors force their franchisees to incur expenditure they can ill afford.

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Are franchisors undermining their franchisees with unreasonable demands?

Start up business

In this tight economy where franchisees are having to contend with a myriad of challenges, the demands of franchisors on their franchisees in relation to contractual clauses such as upgrades and revamps are causing concern. The Franchise Association of South Africa receives calls from existing franchisees sometimes that really seems quite concerning once one hears how they have apparently been treated by their franchisors.

A typical example of such a call the Association receives frequently is made by a franchisee that refused to disclose their details especially the franchisor in question – many quite openly say they fear intimidation and retaliation from the respective franchise company – but would still like to obtain an outside opinion. It is not surprising to learn during the conversation when the franchisee sometimes decides to disclose the franchisor’s name after all, that the relevant franchisor is usually a powerful household name brand.

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