FRANCHISE ADVICE


t is crucial that the nchisor an the oint enture partner are committe to orin toether an are aline on stte alues an oecties


A JV franchise can also be a useful business structure to launch international expansion. In certain countries, a franchisor is required to open and operate its own corporate units before embarking on developing a franchise network. Establishing a JV with a potential franchise partner can allow the franchisor to comply with this legal requirement and enter a market. A JV model could also be applicable as a platform to test a franchise system in a new market before launching a fully- fledged franchise. McDonald’s and Starbucks have both used JV models to enter and expand in international markets, leveraging local knowledge and expertise, ensuring


successful market entry and driving growth. In the UK and internationally, Specsavers, the opticians, operates a unique, highly successful JV franchise business model that has resulted in the business becoming a major high-street brand, delivering professional, high-quality eyecare products and services.


What are the advantages of a JV franchise? There are several tangible advantages to adopting a JV franchise model: 1. As well as “opening the doors” to franchise candidates who can’t meet the investment requirements on their own, there is the benefit of both


parties sharing the financial burden and associated risks. 2. Combined expertise, accelerated expansion and access to local markets. 3. For franchisors, they have the added benefit of additional controls and influence over and above the Franchise Agreement, through the JV Shareholders Agreement. This control can extend to all aspects of the franchisee’s operations such as recruitment, staffing levels, site selection, business planning, pricing, and marketing activities. In essence, franchisors


adopting a JV model can provide greater assistance, support and guidance to the franchisee. →


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