Clean It Up
UK Window Cleaning Forum => Window Cleaning Forum => Topic started by: sunshine windows on October 13, 2014, 09:08:45 am
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Hi Fellas
For those that are running franchises through Ian's system, have you included somewhere in the agreement that the franchisee has to use aworka? (cleanerplanner in my circumstance).
Id also like my franchisees to use Santander, so I can have a view only option on their account.
How easy would these 2 clauses be to implement into the agreement? If anyone has done similar could you please get in touch with how you worded it.
Thanks
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Why do you need to see their banking activities?
Is that how it is with a franchise? I think I'd tell you to sling your hook if thats what you wanted.
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Hi Sunshine
You can put whatever you like in the agreement just make it concise an not ambiguous, if your not sure consult a solicitor.
I would suggest the most important part of the franchise is to provide a service that they want, i.e. great support, marketing and plenty of work, if you do all of this correctly you'll probably find your contract gathering dust.
Hope it helps
John
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Just me wanting reassurance that everything's above board Matt. Not even sure it could be enforced?
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Id also like my franchisees to use Santander, so I can have a view only option on their account.
For anyone who's curious to know: Franchising doesn't work like that - each Franchise Owner runs their own business independently of the Franchisor. Their banking is no one's business except their own. In our system all the Franchisor needs to know is the value of the work the Franchise Owner has achieved in any period and he then invoices the Franchise Owner for the agreed percentage.
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Id also like my franchisees to use Santander, so I can have a view only option on their account.
For anyone who's curious to know: Franchising doesn't work like that - each Franchise Owner runs their own business independently of the Franchisor. Their banking is no one's business except their own. In our system all the Franchisor needs to know is the value of the work the Franchise Owner has achieved in any period and he then invoices the Franchise Owner for the agreed percentage.
Hi Ian
Do you know exactly what your franchisee is doing on a day to day basis and how do you 'police' that if you don't mind me asking?
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Hi Fellas
For those that are running franchises through Ian's system, have you included somewhere in the agreement that the franchisee has to use aworka? (cleanerplanner in my circumstance).
Id also like my franchisees to use Santander, so I can have a view only option on their account.
How easy would these 2 clauses be to implement into the agreement? If anyone has done similar could you please get in touch with how you worded it.
Thanks
The franchisees run Aworka. That makes sense because it means we have one set of instructions in the system manual.
Their bank accounts belong to their businesses. As it happens they do all bank with the Co-op but that's because they get free banking. I don't see why I would ever want to look at their bank accounts.
If you're going to franchise you need to be doing it for the right reasons. Your franchisees are going to run truly independent businesses and you need to let them do that. You have to trust them to run their businesses albeit with your guidance. Running franchisees is not just a cheap way of not employing.
If you're interested, one of the most important things in my business is the notice I have above my desk.
(http://i1359.photobucket.com/albums/q797/Onionman9999/20141013_170402_zps674063da.jpg) (http://s1359.photobucket.com/user/Onionman9999/media/20141013_170402_zps674063da.jpg.html)
I genuinely, genuinely believe that you need that attitude if you want to franchise successfully.
Vin
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Thanks for your replies guys, also for your time on the phone earlier Ian.
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Hi Fellas
For those that are running franchises through Ian's system, have you included somewhere in the agreement that the franchisee has to use aworka? (cleanerplanner in my circumstance).
Id also like my franchisees to use Santander, so I can have a view only option on their account.
How easy would these 2 clauses be to implement into the agreement? If anyone has done similar could you please get in touch with how you worded it.
Thanks
The franchisees run Aworka. That makes sense because it means we have one set of instructions in the system manual.
Their bank accounts belong to their businesses. As it happens they do all bank with the Co-op but that's because they get free banking. I don't see why I would ever want to look at their bank accounts.
If you're going to franchise you need to be doing it for the right reasons. Your franchisees are going to run truly independent businesses and you need to let them do that. You have to trust them to run their businesses albeit with your guidance. Running franchisees is not just a cheap way of not employing.
If you're interested, one of the most important things in my business is the notice I have above my desk.
(http://i1359.photobucket.com/albums/q797/Onionman9999/20141013_170402_zps674063da.jpg) (http://s1359.photobucket.com/user/Onionman9999/media/20141013_170402_zps674063da.jpg.html)
I genuinely, genuinely believe that you need that attitude if you want to franchise successfully.
Vin
Nice attitude to have Vin.
What happens if a franchisee gets more work on his own? Is that new additional work still subject to your monthly percentage or is it treated as his own to resell in the future should be want to?
In other words, what is to stop your franchisee growning his business and starting his own franchise round in the future as you have with your own business?
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Hi Spruce, speaking about my own business (im sure Vin will be running his the same way on this subject) Any new work gained by the franchisee belongs to the franchisor, its added to the round and commision is paid on this. The franchisee is using the franchisors name and system of cleaning. Any franchisee caught 'moonlighting' could have his licence revoked therefore losing his business. Pretty sure this will apply in Vin's case as well.
Regards
Dave
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Surely that cant be right??
If i bought into a franchise that gave me £1000 a week to clean and id have to pay 20 percent to my franchisor (£200)which is fair enough as they own that work but if i gained new customers whilst out and about myself then surely those customers would be mine as i didnt pay for those customers in my upfront franchise fee and also how would the franchisor know i have those new customers or am i totally wrong and there is a law to say the work belongs to the franchisor no matter what if you buy into 1??
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Hi Spruce, speaking about my own business (im sure Vin will be running his the same way on this subject) Any new work gained by the franchisee belongs to the franchisor, its added to the round and commision is paid on this. The franchisee is using the franchisors name and system of cleaning. Any franchisee caught 'moonlighting' could have his licence revoked therefore losing his business. Pretty sure this will apply in Vin's case as well.
Regards
Dave
Hi Dave
Things must be good your side - new van combo etc. :)
Met one of your franchisees about 3 weeks ago - nice lad.
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Surely that cant be right??
If i bought into a franchise that gave me £1000 a week to clean and id have to pay 20 percent to my franchisor (£200)which is fair enough as they own that work but if i gained new customers whilst out and about myself then surely those customers would be mine as i didnt pay for those customers in my upfront franchise fee and also how would the franchisor know i have those new customers or am i totally wrong and there is a law to say the work belongs to the franchisor no matter what if you buy into 1??
Franchising isnt buying a round , most franchises come without customers
You buy a method and someone's experience and brand
it seems pointless to most of us who have already built a business in window cleaning
But i reckon for someone stuck in an office or other job they hate who needs to be earning similar money quick but in window cleaning - franchising is a great option- they are paying to basically be guided past all the pitfalls we all had , pricing wrong , cleaning wrong etc etc
But like everything theres a cost - in this case the franchisee commision on everything they earn
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From what i have read in the web the main problem with going down the franchise route is franchisee fatigue.
Keeping the franchisee feel they are get value for their 20% not just wasting money and eventually leave to setup on their own.
Paul
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Surely that cant be right??
If i bought into a franchise that gave me £1000 a week to clean and id have to pay 20 percent to my franchisor (£200)which is fair enough as they own that work but if i gained new customers whilst out and about myself then surely those customers would be mine as i didnt pay for those customers in my upfront franchise fee and also how would the franchisor know i have those new customers or am i totally wrong and there is a law to say the work belongs to the franchisor no matter what if you buy into 1??
Of course it's right. You would only be there in the first place with the knowhow, equipment and good name because you the franchise. Name any other franchsie that allows the franchisor to build up a customer base independent of the franchise business. It's the equivalent of a McDonalds franchise selling an Iceland burger in an Aldi bun and the franchisor keeping the money cause it's nothing to do with McDonalds innit.
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If i bought a mcdonalds franchise then custom would come to me so its quite different.
If i bought into a franchise for say 10k for 4k a month of work and by myself over the years gained another 2k of work that i didnt buy when i bought the franchise then surely that other 2k would belong to me as i did t pay for that extra 2k of work otherwise all id be doing is profiting the franchisor when he didnt actualy gain me that work in the first place.
Im guessing the more work a franchisor gives is the more the franchise outlay has to be??
Eg 2k of work could be 5k to buy in or 4k of work 10k to buy in??
If so then that extra work shouldnt end up being owned by the franchisor! If not and the franchise costs the same nomatter how much work is given then yes id agree it should belong to the franchisor.
Not that it realy bothers me as im not planning to franchise im just curious if in the eyes of the law if there is anything in stone that would make that extra work gained by the franchisee by canvassing or however He gets the extra work that states it should belong to the franchisor?.
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Its all set out in your 'agreement' that your franchisee signs. Once signed this can be used in court by either party.
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If i bought a mcdonalds franchise then custom would come to me so its quite different.
If i bought into a franchise for say 10k for 4k a month of work and by myself over the years gained another 2k of work that i didnt buy when i bought the franchise then surely that other 2k would belong to me as i did t pay for that extra 2k of work otherwise all id be doing is profiting the franchisor when he didnt actualy gain me that work in the first place.
Im guessing the more work a franchisor gives is the more the franchise outlay has to be??
Eg 2k of work could be 5k to buy in or 4k of work 10k to buy in??
If so then that extra work shouldnt end up being owned by the franchisor! If not and the franchise costs the same nomatter how much work is given then yes id agree it should belong to the franchisor.
Not that it realy bothers me as im not planning to franchise im just curious if in the eyes of the law if there is anything in stone that would make that extra work gained by the franchisee by canvassing or however He gets the extra work that states it should belong to the franchisor?.
I can only speak for myself here.
The franchisee doesn't have to gain any work at all, ever. We supply the work they need to reach an agreed target turnover. All the franchisee has to do is to clean windows (and run the business). The franchisee never, ever has to canvass, or write a leaflet or run a website, etc, etc.
Ref the customer, if a franchisee is only out cleaning windows because they have bought our franchise, it's reasonable that walk-ups and referrals result in royalty payments. Without the franchise, that business would never have come in. We make sure that franchisees know this before starting. That way, anyone unhappy with that arrangement can just not buy the franchise.
Yes, we charge a flat fee. You can buy our franchise and aim to work a day a week or you can buy it and work four days a week. Your choice. I'll keep feeding the work as long as you can service it.
We also (and I know this is unusual) make almost no profit from the franchise fee. Why? Keeps me honest. There's no incentive to take someone on unless they look likely to succeed in the long term. Some of the franchises I've seen seem to make so much money from their franchise fees that they are very focussed on selling to new people to the detriment of making the franchises work.
Vin
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Nice 1, that made sence. I didnt realise you build as much work as they want or can handle! I assumed they just buy in and recieve a set amount of work to go and get on with without room for growth.
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The office cleaning franchises like dublecheck etc work like this as well ... any new contracts go to franchisor and u pay the royalty on top
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The misconception here is that the franchise owner 'buys' the work
He doesn't. He buys a franchise. This entitles him to operate a business according to the franchisors proven system and earn the profits from doing so. The work is the franchisor's. This is true for all franchises and in fact most come with no work at all! The new franchisee starts from scratch, building his customer base according to the franchisor's method. My system is different because we guarantee the franchisee as much work as he can handle.
If the idea that 'self generated' work was the franchisee's 'own' work and not subject to royalties, then no franchising system would work.
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Ian
Can I ask, does your franchise license/agreement allow your franchisee to take on employees? Is there an additional franchise fee payable if they do take on employees?
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Yes. They can take on as many employees as they like.
No, there is no 'additional' royalty - it's all covered by the basic 20%, i.e. 20% of the franchise turnover, so whatever the gross value of work done is we invoice for 20%.
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Thanks Ian
Hope you don't mind a few more questions.
How long does your license agreement last and what is the renewal fee?
Is there reductions in the royalty fee if certain amounts of sales are achieved?
i.e. First 50k of work royalty is 20%
Next 50k of work royalty is 15%
And so on ... This gives franchisee incentive to build his business for both your benefits.
What is the minimum amount of work you would consider franchisable? I like working in batches of £750 per week, but I am in Scotland and prices are not anywhere near what you get down your end of country.
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The licence is for as long as you want it to be - you decide. It's guaranteed renewable at no cost provided all conditions have been met during the period.
Again any reduction as an incentive would be up to the franchisor - we don't have such an arrangement because none of our franchise owners have that much ambition.
As I said in an earlier post, we guarantee as much (or as little) work as the franchise owner can handle. Obviously it would need to be enough for the franchise owner to earn a good income after royalty payments