Does your franchise association need support?

Franchisees and franchisors confer with each other. As a franchise organization grows, there arises a need for consultations between the franchisor and a collective of franchisees. This begins with informal meetings and later progresses to a ‘franchise council’, also known as ‘franchise consultation’ or ‘central consultation’.

Franchisees often gradually organize themselves into a franchise association. This creates a so-called ‘formal entity’ in relation to or alongside the franchisor. The association is a democratic body with an elected board that speaks on behalf of the affiliated franchisees. Individual board members then bear responsibility on behalf of the affiliated franchisees.

However, franchisees often lack the time and/or experience with all the formalities that accompany this. Think of statutes, regulations, annual reports, and separate VAT returns, for example. The board of the association is also confronted with complex matters that are economically or legally complicated. Or with issues where franchisees might have differing opinions. In such cases, external support can be extremely useful.

Koelewijn & Partners has years of experience in assisting franchise councils and franchise associations. There are three basic forms, all possible as an independent party:

• Chair of the association
• Advisor to the franchise association
• Chairmanship of the central consultation with the franchisor

Chairmanship of the Franchise Association

As chairman, we lead the board meeting(s) and the annual meeting of the franchise association. We can also arrange the documentation of these meetings. Our tasks generally include:

• Preparing the meetings
• Telephone pre-discussion
• Sending invitations
• Leading the meetings
• Taking minutes of the meetings
• Drafting the minutes
• Sending minutes to members
• Monitoring decisions
• Maintaining contact with the members and the board of the association

In this option, our role is primarily focused on technical or independent chairmanship, process support, and documentation of the meetings. An important part of the independent chair's task is often to promote connection among the franchisees.

Advisor to the Franchise Association

If the board is willing and/or able to handle the chairmanship itself, it is also possible to engage Koelewijn & Partners as an independent advisor to the franchise association. Engaging an independent advisor can be beneficial for various reasons. For example, if:

• There are differences of opinion within (members of) the franchise association
• Certain issues within the franchise formula remain unsolved and the board wonders what is reasonable and fair
• The board seeks a sparring partner with more experience on how to handle the managerial consultation with the franchisor
• The franchise collaboration needs to be renewed, where there are conflicting interests between the franchisor and franchisees and/or among franchisees
• Temporary additional expertise is needed on specific franchise topics

These aspects can, depending on the agreements, also be part of the task package of the independent chair described earlier.

Chairmanship of the Central Consultation

It also regularly happens that the franchisor and franchisee representation experience difficulty focusing both on the content and the process during the consultation meetings. Or that the results of the consultations, despite all the time invested, are minimal. An independent, knowledgeable chair can then be a solution. This also applies, for example, if the central consultation has been running less smoothly for a while. Additionally, this role can be beneficial if parties simply prefer to ‘outsource’ the chairmanship and documentation independently. An advantage of such a role is that the independent chair can also mediate between the franchisees association and the franchisor, for example.

Practically and substantially saving costs

It is not immediately clear which base form is best for your franchise organization. A preliminary meeting is necessary for this. Our extensive experience with consultations between franchisors and franchisees indicates that structural support not only costs money but actually saves a lot of money. Primarily because:

• There is consistent follow-up on the consultations
• Time is spent more effectively and efficiently
• More specific results are achieved
• Better communication and explanation often help avoid higher legal costs
• The advisor or independent chair can act as machine oil

It is clear that both the franchisees and the franchisor benefit from professional consultations. In practice, it is often the case that the franchisor, depending on the form of support, often provides a financial contribution to professional consultation. In short, if your consultation could use a push in the right direction or more, please contact us.