The Importance Of Trust And How A Franchise Can Help Build That

In a recent survey conducted by Better Business Bureau, it was found that trust on the companies that a customer deals with on a daily basis is dropping. There are a few recent incidents that have contributed to this notion such as unethical and criminal acts by top company executives or the sub-prime mortgage and foreclosure crisis. Nearly one in five Americans says that their trust in the companies has decreased in the last 12 months and such feeling is neither good for the industry nor for the economy. In the survey, 93% people have said that honesty and good reputation is what they are looking for while dealing with a company. In the franchising business, trust is even more important. A customer, while dealing with a franchised unit, knows that he is not dealing directly with the company and hence, the parent company has to work doubly-hard to check whether people trust the name wherever they hear it.

In order to make the customers trust them, the franchisor and the franchisee should trust each other first. Trust is the foundation of any business; and the franchising arena is no different. The franchisor must have conviction in the ability of the franchisee to run the business smoothly. He should not always assume that “it could have been better.” He have to trust the franchisee on sales figures and the revenue earned; if he nitpicks every detail, then the relationship between them will get hampered and so will be the business. If the customers find the franchisor and franchisees fighting among themselves (like it happened with a well-known food-industry franchise giant), then they will think twice before stepping into any store of that company. It is necessary to see that the franchisees maintain uniform standard, but too much interference can ruin the relationship with the customers. So, for the sake of the customers, the franchisor is required to have confidence in the ability of the franchisees.

The franchisee, on his part, must keep the two promises that he made – paying the bill and following the system. Both have to be strictly maintained, if he wants the relationship to work. The franchisor has spent a lot of time and money to perfect the system that the franchisee uses. Hence, he has every right to ask for the money that the franchisee gets by using the system. Also, if the franchisor has more than one franchisee; he has the same duty towards each one of them, because, if one franchisee does not follow the system and things do not go well, the whole chain suffers for that. This is especially true for food-related industry where strict standards have to be maintained as per the instructions of the franchisor. Lastly, no matter what internal problems they have between themselves, the franchisor and franchisee are supposed to present a unified face in front of the customers.

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