with no experience will listen the most to you. Somebody who
has a lot of experience may think he can do it better,” Russo
says. “At the same time, you do need to listen to your franchi-
sees. We’ve had very knowledgeable people who gave us a lot of
input and strengthened the brand—we don’t know everything.
The Big Mac and Filet-O-Fish were created by McDonald’s
NYPD holds a four-week training session for new partners
in a corporate store and has someone on hand for follow-up
training in new stores during the pre- and post-opening stages.
After that, the company continues to keep close tabs on its
franchisees. “We send in secret shoppers, especially if we have
had complaints, and conduct announced checkups periodi-
cally,” Russo says.
Consistency from one store to another is particularly important to a franchised concept. For example, most franchisors require all of their stores to use certain proprietary ingredients—such as sauce, cheese, flour mix and meats—to ensure
dependable quality and taste from location to location. But they
also may encourage the use of local, seasonal produce and the
addition of ethnic dishes. Many franchises require a basic floor
layout and select furnishings, but they may allow some flexibility in finishing touches to give each shop a mom-and-pop
feel and to reflect the local culture (think Elvis-themed decor in
Memphis or Buckeye souvenirs in Ohio).
“You need to listen to your franchisees. We’ve
had very knowledgeable people who gave us
a lot of input and strengthened the brand—we
don’t know everything. The Big Mac and Filet-O-Fish were created by McDonald’s franchisees.” —Paul Russo, NYPD Pizzeria
Small numbers, Big Choices
To get started as a franchisor, you will first need to create a legal
Franchise Disclosure Document (FDD), which states all of the
information about your business and is presented to prospec-
tive franchise buyers. However, that sort of paperwork doesn’t
come cheaply. “Just obtaining general counsel for the FDD and
trademarking your logo can run six figures,” Russo explains. If,
like Russo, you plan to handle the process by yourself, expect
costs for franchising to run in the six -to seven-figure range.
“I did everything hard-core,” he recalls. “I hired a franchise
attorney, a contract attorney, an intellectual property attorney
and a general business attorney. I hired people in-house for
marketing, artwork and public relations.”
In addition to an FDD and a trademarked logo, you’ll need
a business plan, a marketing plan, an operations manual and
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