Starting a Franchise: The Significance of your Operations Manual.

If you are considering and evaluating the process of "franchising your business" one significant factor that you must evaluate is the significance of your operations manual. Your operations manual should serve as an integrated component to your franchise disclosure document (FDD) and franchise agreement by providing franchisees with a detailed blueprint as to each and every administrative and operational detail of the franchised business. Start-up franchisors should consider the following:

  • Your confidential operations manual should serve as a supplement to your franchise agreement wherein you provide franchisees with detailed information about starting-up, managing and operating the franchised business.
  • Your operations manual cannot be outsourced to a third party or simply based on generic forms. As the key architect of your (presumably) successful business you must be actively involved in the drafting and preparation of your manual. During the drafting and preparation process you must actively consult with your franchise lawyer to ensure that your franchise agreement and operations manual support and compliment one another.
  • Your operations manual must be continuously updated to ensure that it reflects your then current systems and procedures. This is an important point and critical resource for franchisors, that is, your operations manual (if your franchise agreement is drafted property) should serve as a vehicle to "contractually" implement new and revised systems and procedures to be followed by franchisees.
  • Some of the topics and information that should be included in your operations manual, include information about:

    • The Franchisor and the Franchised Business;
    How the Operations Manual Should be Utilized;
    The Franchisors Procedures for Supplementing and Modifying the Operations Manual;
    The Confidentiality of the Operations Manual;
    The Mission of the Franchisor and the Franchised Business;
    About our Clients and Customers;
    What you Need to Know After Signing your Franchise Agreement;
    Locating your Business;
    Plans, Specifications and Approved Vendors for theEstablishment of your Store;
    Your Initial Training;
    Operating the Franchised Business;
    Managing the Franchised Business; and
    Advertising and Marketing.

    There are numerous other topics and within most of the topics outlined above there will be numerous sub-topics. However, for the start-up franchisor you simply need to know that your operations manual is important. In fact, it is so important that you - personally - must be engaged in the development process. During this process there must be coordination with your franchise lawyer to ensure a comprehensive integration of your FDD, Franchise Agreement and Operations Manual.




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