The FDS International Franchise Consultancy Work Programme
For franchisors thinking about franchising their business internationally, Franchise Development Services (FDS) recommends starting with a detailed pre-entry study to help assess the suitability of the business for market expansion. This pre-entry study covers up to 21 key areas which include market research, license fee structures, capital requirements, financial projections for the originating franchisor, Master and Area Developers, Intellectual Property Rights, Franchise Rights documentation, draft International Franchise Memorandum and other additional important considerations. The objective is to adapt the franchise offering to suit local customs, trading conditions, and to ensure maximum synchronicity between the original franchise operation and the replicated systems in the targeted country.
This service is designed specifically for franchisors who wish to enter any of the markets where FDS has offices established, such as the United Kingdom, Spain and Australia or one of the 21 countries worldwide where we have FDS Associates and investors. All our clients need to be prepared to commit the necessary time and resources to work with us to achieve the end results. Whether you are new to international franchising or an experienced operator, we strongly recommend that you talk with us in the first instance so that we can confirm our interest in working with you and we will then carry out a review of your documentation with no cost or obligation. We will also provide you with immediate advice and guidance so that you will better understand what will be required for specific target markets.
Below is a summary of what we normally expect to receive:
1/ Copy of both your National and International Franchise brochure
2/ A copy of your Franchise Information Memorandum or equivalent
3/ A copy of your Master Franchise or Area Development application form
4/ Your Franchise Disclosure Document or country equivalent
5/ A copy of the content pages of your National Operations Manual and CEO’s Operations Manual
6/ A copy of your Master Franchise agreement
7/ Copies of any pre-entry research that has been carried out in relation to the target markets
8/ Your standard forms of undertaking confidentiality and any other agreements that you would like us to sign
Once we have carried out this detailed analysis, we will come back to you with our thoughts and recommendations. We will then nominate an FDS International Franchise Consultant who will be totally responsible for facilitating all elements of the agreement between our two companies and remain with you even after the awarding of the franchise rights.
A summary of the seven steps that we work through is as follows:
Step one: Our process begins with a review of your existing documentation and then if considered necessary, we will meet with key personnel at your head offices to determine needs, analyse your systems used, identify corporate strengths and access suitability for the target market or markets under consideration.
Step two: We commence a detailed work programme to conduct pre-entry research so that we can define the content and market value of the Master Franchise Rights to be offered.
Step three: We then work with you to confirm the content and value of the Master Franchise Rights package and outline the development programme and financial projections for investors and their networks.
Step four: Creation of pre-sale documentation. FDS will work with experienced franchise lawyers to produce the franchise agreements and assist with securing the Intellectual Property Rights and coordinate the production of promotional materials to support the marketing of your Franchise Rights.
Step five: Master Franchise Owner investor recruitment. FDS will utilise what is considered to be one of the most valuable databases of international investors. We have over 100,000 individuals and organisations registered with us seeking to own Master, Area Development or single unit franchise rights. We will also use our printed, online, digital and App franchise titles to market the availability of your Master Franchise as considered most appropriate.
Step six: Recruitment of Master Franchise Owner investor. FDS will respond to enquiries through our international FranMatch service, drawing up a short list of suitable candidates and arranging introductory meetings between you, the franchisor, and prospective investors.
Step seven: Master Franchise Owner investor assistance. FDS will deploy their resources to assist the Master Franchise Owner investor to develop their franchise in accordance with the franchise development business plan.
When we promote the availability of your Master Franchise Rights, they will appear in print in national and international franchise publications, including The Franchise Magazine, The United Kingdom Franchise Directory, Irish Franchise Magazine and for the international market www.Franchise-International.net and our new International Franchise Directory, which is totally dedicated to promoting the availability of Master Franchise Rights worldwide. For Europe, we use www.EuropeanFranchising.net and national franchise recruitment websites as appropriate.
When enquiries start to be received your international FranMatch Executive will act as your Account Manager and carefully evaluate every application and process through to visiting with you and working through to conclusion. They will respond to all applications, screen and interview qualified candidates and help them to understand not just the opportunity being offered, but their obligations of owning, operating and developing your franchise to its full potential in the target market.
We never recommend that you award a franchise to the first candidates that come over to meet with you. It is very important to award your franchise to the best organisation rather than the first applicant. We also have ‘Brand and Sector shopping lists’ of some very important international franchise developers who give preference to acquiring Master Franchise Rights for the countries where they have established and already developed other franchise brands.
All of our agreements are on an exclusive basis so that all enquiries, including those that may come directly to you, will be passed to us for processing. This avoids any conflict with prospective investors endeavouring to deal directly with you to try to circumnavigate our agreement.
We clearly discuss and agree any third party costs and do not incur these until the receipt of instructions from you. All of our contracts are based on year-to-year agreements and work done to achieving results within this timeframe.
Written by Professor Roy Seaman, founder and Managing Director of Franchise Development Services