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Is it Franchisor or Franchiser?

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Many, including myself, refer to franchising as an industry... even though we know it's really not an industry. A business model is probably one of the better definitions, but what does that really mean?

When referring to a franchise, even many within franchising choose from a variety of terms as a point of reference - franchise organization, franchise system, franchise company.

Of course, there's also the varying terms relating to the franchise relationship - franchisee, franchise partner and not to mention the slang, zee. And to the other side of the relationship - franchisor, head office, corporate office, parent company... and yes, zor.

And what's the difference between franchisor and franchiser?

Confused yet?

And, franchise locations are independently owned and operated. Yet, the franchise relationship is interdependent... or at least it should be interdependent and not dependent or independent upon... Well, you get it, right?

Now let's look at the people serving the franchise community. Yep, franchise community is another reference for the franchise list above but let's move on. Franchise consultants, do they sell or consult? How about franchise brokers, sales agents, sales representatives, and again, franchise consultants. Whew!

Moving down the chain there are franchise suppliers, service providers and vendors... What's the difference? Preferred or approved? Is there really a difference?

Of course, there are references to segments within franchising such as master franchising and sub-franchising... Which one is correct? And, isn't the sub-franchisor actually the master franchisee? I guess it all depends on which end of the relationship one is on.

How about now - confused yet?

Franchise services means what, and providing services to who? Franchisee to end-user? Franchisor to franchisee? Franchise service provider to franchisor and/or franchisee?

Same can be said of franchise marketing, right? Does marketing in a B2B or B2C scenario but within a franchise environment mean that it's franchise marketing? Or, is franchise marketing actually marketing to franchise candidates?

Speaking about franchise candidates, when is a candidate actually a candidate and not a lead or just an interested party? Does this fall under franchise sales or franchise development? And who's in charge - the VP of Franchise Sales, VP of Franchise Development, or VP of Franchising?

And then there's reference to franchise professionals. Is a franchisee a franchise professional? How about if the franchisee is a multi-unit franchisee with 25 locations? How about a franchise attorney? Franchise service provider?

If a franchise executive is a franchise professional, at what level of management does one begin to be considered a franchise professional? How about within the franchise organization itself?  Secretary, if their support is purely administrative as opposed to an admin that actually communicates with franchisees?

Oh, and should the CEO of a franchise company be considered a franchisor as we often refer to them as such at franchise events?

Ironic how franchising is the replicating of a system with focus on consistency in image, appearance, product and service from one location to another. Yet, there's little consistency in the terminology used to define many aspects of franchising

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7 Comments

At my last position, my title was Franchise Development Director (or FDD for short). But then they changed the UFOC to an FDD and we had to change our titles to avoid confusion. You're correct in pointing out that inconsistency seems to be the constant we can all count on.

@Patrick -

So you didn't want to be an FDD anymore?

Paul that was a fun read. The who is in charge question is a whole topic on its own. Next you could get into the franchise disclosure and agreements. Try to figure out what all that legalese means and what you are signing up for. I think every company is different and every time there is a new leader it changes.

I want to deliver FDDs, not be one - ha!

I think the IFA should release "The Definitive Guide to Franchise Jargon" and set the record straight here ;)

I must say though, it does get under my skin a bit every time I see "franchiser" when referring to "franchisor".

Hello:

I do not usually engage in this manner, but I felt compelled. One, because I have been in this industry for a very long time ( and yes it IS an industry) and I have felt the accolades and the failures first hand.

Also, because I respect Paul Segreto as being one of the best Educators we have currently, and a pioneer.

"Many, including myself, refer to franchising as an industry... even though we know it's really not an industry."

I take issue with this considering (the "Franchising Industry" has been my main source of financial support for the better part of 20 years), I have been a Franchisee, supported Franchisors (and it is "sors") in their quest to grow as well as new companies considering franchise growth.

"Franchise consultants, do they sell or consult? How about franchise brokers, sales agents, sales representatives, and again, franchise consultants. Whew!"

Let's consider this for a moment... If a Franchisor or a Broker/Coach is under the assumption this is a "sale" or there is a "selling component" to this, in my opinion they are wrong.

If a Franchisor is selling their concept and not "awarding", they aren't considering their community, the investments of their franchisees and the long term effects on their franchise community, let alone their overall earning potential, by awarding and not selling.

If a potential Franchisee or their Broker/Coach is positioning this or viewing it as a purchase rather than an investment, then both are misguided.

Franchisors are not "selling", they should be awarding and potential Franchisees are not "buying" they are investing.

There is a big difference in the realities of selling vs. awarding and purchasing vs. investing.

"Speaking about franchise candidates, when is a candidate actually a candidate and not a lead or just an interested party?"

In my opinion, it depends on the process of awarding through the Franchisor. If the Franchisor has a reciprocal process "the candidate/lead" will become viable (interested party) after the first conversation.

"And then there's reference to franchise professionals. Is a franchisee a franchise professional?"

Absolutely not. They are no more versed in matching a prospective business owner to businesses, financing, fear management, and adhering to the process than any other person considering a Franchise.

Those of us that are in this "Industry" as professionals, take great lengths to enhance our education (CFB, CFE, etc) perfect our craft, and take our clients best interest to heart through every step. These are the true "Franchise Professionals."

"How about if the franchisee is a multi-unit franchisee with 25 locations?"

Simply put they are great business partners and facilitators.

"How about a franchise attorney? Franchise service provider?"

They are Franchise professionals.

"Does this fall under franchise sales or franchise development?"

Franchise development.

Again in my opinion it should be development, not sales.

And who's in charge - the VP of Franchise Sales, VP of Franchise Development, or VP of Franchising?"

The VP of any of the these departments, whichever they choose to be called is responsible for the
overall performance of their group.

"If a franchise executive is a franchise professional, at what level of management does one begin to be considered a franchise professional?"

This depends greatly on the organization,and how they define it, but I have to admit I have come in contact with many Franchise professionals that are in business for themselves and do not work for an organization that they themselves do not own.

How about within the franchise organization itself? Secretary, if their support is purely administrative as opposed to an admin that actually communicates with franchisees?

This position (secretary or Admin) should be considered a Franchise Professional, one would be "hard pressed" to find an Admin/ Secretary that was versed in the types of contracts and regulations required to fulfill a Franchise Agreement.

Thank you for your time and consideration.


It is interesting to see that debates about terminology used in Franchising are going on everywhere. There has recently been some debate over the use of "Franchise Owner" versus "Franchisee" here in the UK. An agreed set of jargon would be nice but in my view is nothing more than a dream, especially here in the UK where regulation is minimal.

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About this Entry

This page contains a single entry by Paul Segreto published on January 17, 2013 8:30 AM.

Can This Old Franchise Survive? was the previous entry in this blog.

Do You Know the 7 Reasons a Franchisor Can Terminate You? is the next entry in this blog.

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