Why franchisor must hold the reins to the brand
Brand is integral to franchising, and taking control and ownership of a business brand away from the franchisor and handing it to individual franchisees is just not franchising, a Griffith Business School researcher has claimed.
Maurice Roussety says such a business model is nothing but a fix-all solution that will fail in the face of emerging challenges to franchising.
He was responding to an article published by the Wall Street Journal in which two Australian researchers put forward the merits of ‘quasi franchising’.
This franchising model would give franchisees control of front-of-house activities like name, image and feel, while still retaining franchisor input and guidelines for back-of-house functions in kitchens and offices.
“The franchisees, in effect, are paying to slap their own brand over an existing, well-oiled operation,” write Andrew Terry and Cary Di Lernia from the University of Sydney Business School.
It’s an argument rejected by Maurice Roussety, a PhD candidate at Griffith’s Asia-Pacific Centre for Franchising Excellence.
Read Maurice Roussety’s paper here.
“Franchisees would have all their own branding,” he says. “But this is not franchising.
“It would be like putting a Mercedes engine in a Holden chassis with a Toyota badge”.
“Can you imagine how Ray Kroc would react to someone mounting anything other than the golden arches outside one of his restaurants?”
Maurice Roussety argues the foreseeable focus for franchising should be on adapting to e-commerce and changes in customer choice and preference.
“The franchising model is not broken. Brands just need to reinvigorate their franchisees.”
Dr Maurice Roussety is a Consulting Strategist for DST Advisory and Lecturer in Small Business, Franchising and Entrepreneurship at Griffith University in Queensland, Australia. He has worked with leading organisations such as Queensland Transport, IAG, Westpac, Australia Post, Coles Myer, Red Rooster, Commonwealth Bank, ACCC, and Optus. Maurice holds a PhD in Intellectual Property and Franchise Goodwill Valuation. He also holds a Master’s degree in Leadership and in Business Administration. He is available for consulting and public speaking engagements and can be contacted further at maurice@dstadvisory.com or you can visit him at www.mauriceroussety.com.au
