The Faded Franchise Operations Manual

The Franchise Operations Manual is often toted as one of the most important documents in franchising, so it is rather disturbing that many franchisees choose to ignore it.


Throughout my 17 years in franchising I’ve had numerous and varied responses to the question of “What is the purpose of the Operations Manual?”, the least favourable of which is, “If it is clearly set out in the Operations Manual franchisees have no leg to stand on in the event of a compliance dispute.” An Operations Manual is not measured in reams or centimetres; instead, its value is measured in its relevance. Ideally it should be a proactive body of best practice guidelines to ensure that franchisees operate at the greatest levels of efficiency for business success. 


Not too long ago just about every household had a set of encyclopaedias — the unquestioned and essential reference manuals for knowledge and research on just about any subject. Today, however, these green giants are extinct, replaced by instant access to information in the palm of our hand. Instant access to information or the solution to a problem is becoming the norm, no more thumbing through index pages when we can ask Siri or perform a quick Google search. In fact, some rely on and have so much faith in the results that they have taken to ‘diagnosis by Net doctor’ rather than seeking the opinion of a trusted and trained family physician. 


What should be on the inside?The Operations Manual should incorporate all aspects of the business system and the intellectual property the franchisor is transferring to a third-party franchisee; essentially everything needed to run the business successfully to fast track the franchsees journey to success. A franchisee investing in a brand pays a premium for the ‘school fees’; the lessons the franchisor has already learnt. However, these lessons are of no use unless the best practices and templates are documented and easily accessible in the day-to-day operations of the business. 
It is also advisable to incorporate a ‘pre-opening’ section with the set-up plan and applications required prior to opening the franchise. The roles and responsibilities of each party (franchisee, franchisor and other contractors) could be as simple as a detailed spreadsheet or project plan that sets out the deliverables, the responsible party, and a clear timeframe or countdown to opening. 
A typical error is an Operations Manual which contains only operational practices specifically related to the franchised business; an Operations Manual should be all-encompassing. In addition to the menus and recipes, an Operations Manual for a quick service restaurant, for example, should include business management sections such as: 

  • Financial management;
  • Key performance ratios;
  • HR/IR;
  • Customer service;
  • Stock management;
  • Sales and related targets;
  • Marketing (including local area marketing);
  • Supply (including procurement and ordering);
  • Emergency procedures; and
  • A directory of all relevant contact details.

A comprehensive Operations Manual is an integral part of managing franchisees and the consistency of the business format. It is also the basis for the franchise training that should take place prior to opening. Most importantly, the Operations Manual is a living document that should be amended and updated as the business model is improved and refined. It is also advisable to incorporate a clause in the Franchise Agreement that compels franchisees to adhere to the manual and its updates. 


Is it a printed body of paper? Progressive franchisors are embracing technology and opting to make their Operations Manuals available electronically with intranet/extranet or cloud-based solutions. This move to modern solutions is accompanied by search options and help button functions that make it easier to use.
Franchise Infinity is a new international tool in the South African market developed by Philip Morrison, founder of Franchise Accountants, a firm that specialises in providing accounting solutions to the franchise community, and Shane Boulle who has experience as a franchisee, franchisor and operations manager for KFC. By pooling their experience, they have brought together every aspect of a franchise’s daily operational routine in one easy-to-use app and mobile cloud-based solution. Everything from operations manuals to employment documents, marketing tools, margin calculators, training content and order forms, essentially everything a franchisee needs, could be accessed from a single location so that everyone always has access to the latest information. “And because access is traceable, franchisors can see who has received the latest information and who has actually read it,” says Morrison. Franchisors can now follow up to ensure that new product menus have been opened, that franchisees are aware of new promotions and how to set the till codes, as well as important legislative changes such as health and safety procedures. Furthermore, where those items are linked to training requirements, franchisors and their support staff can also see who is up-to-date and who might need help.


Tackling the taskBecause drafting a manual may seem daunting, we suggest that you start small and prioritise the sections and templates which are most critical to the business — you can slowly add to the manual and refine it over time. Create a skeleton or framework (essentially a comprehensive table of contents), then tackle a section at a time and the content will start to take shape. You may want to draw on the expertise already present in the business by assigning selected sections to different resources. If you already have a network of franchisees, engage them by assigning sections for verification, especially to those franchisees who show pockets of excellence. If you choose to appoint an external service provider to compile the manual for you, be aware that you cannot be absolved of all responsibility; you are, after all, the one who knows your business best.
In summary — draw up a table of contents, draft the chapters and then edit and review. Ensure it is relevant to your business and provides user-friendly access to information. A manual is only as good as the efficient behaviour it directs — ensure that yours is relevant and accessible.


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