FACILITY CENTER
Location Selection
One of the most important decisions franchisees make is where to locate their offices. The location selection process includes research, analysis, approval and negotiation. Although a franchisee's sales ability is the first determinant of success, a suitable location improves the odds for success.
- Research
Facility center personnel begin the location selection process by researching the franchisee's individual situation including location preferences, specialty preferences and budgeting limitations. The franchise application and the franchise committee meeting with prospective franchisees are the primary sources of information. This information is used to identify one or more prospective locations.
- Analysis
A cost-benefit, or “doability,” analysis is compiled by the facility center for each prospective location. Facility center personnel analyze the costs of the prospective location and advertising center personnel analyze the marketing and branding benefits of the prospective location. Population trends, demographic information, crime rates, vacancy rates and other neighborhood factors are also analyzed. Traffic counts, complementary businesses, parking, lighting and other facility-specific issues are considered as well.
- Approval
Signing an office lease agreement is a significant financial commitment. The doability analysis for the prospective location is reviewed by a lease committee whose members include senior franchise management, facility center management and advertising center management. If approved by the lease committee, the facility center enters into a lease agreement on the prospective location, which is then subleased to the franchisee. Oftentimes, landlords prefer a relationship with a larger established company instead of a smaller startup company, so franchisees are more likely to get the property that suits them if it is subleased from the facility center. The facility center's willingness to enter into a lease agreement, demonstrates senior franchise management's confidence in the suitability of the location.
- Negotiation
Once a location has been approved by the lease committee, the facility center begins lease negotiations in earnest. Facility center personnel have negotiated hundreds of leases. Their familiarity with the process improves the chances that the lease rates will be competitive and the lease terms reasonable.
Office Setup
Getting an office opened immediately is important to franchisees because a delay in opening a franchisee's office means a delay in selling. Office setup by the facility center typically saves franchisees time and money. The office setup process is governed by the Office Rent Agreement, or ORA, which outlines what the facility center will do to help franchisees reduce office expenses and facility hassles.
- Office Rent Agreement
The ORA is a comprehensive, one stop office setup solution that may include office premises, signage, office equipment, computer equipment, utilities, telephones and logo vehicles. Because the setup of an office usually results in branding from signage and logo vehicles that benefit all franchisees, the ORA typically reflects a discount in the franchisee's occupancy expense based on the estimated value of this branding benefit to the franchise network.
An important part of the ORA is a plan for office setup that provides franchisees with the experience resulting from the setup of hundreds of offices by facility center personnel. The ORA specifically identifies the equipment and premises available for use by franchisees under the rent agreement. The portion of ORA monthly rent expense allocated for use of equipment that does not provide a branding benefit is typically calculated at a reasonable rate by dividing the cost of equipment by 60. Franchisees do not typically receive a discount on the portion of ORA monthly rent expense for monthly expenses like utilities because there is no branding benefit; however the facility center personnel typically process utility payments which results in a time and administrative cost savings to franchisees.
 - Office Renovations
The ORA's office setup plan sometimes provides for the renovation, build out or refurbishing of an office space. Facility center personnel hire contractors, secure permits and coordinate renovation activities, resulting in significant time and administrative cost savings for franchisees.
- Office Equipment
Facility center personnel coordinate delivery of office equipment and recommend office décor based on the ORA office setup plan. Computer equipment is ordered based on recommendations from facility center's computer support team.
- Office Utilities
Facility center personnel coordinate utility hookups, utility deposits and other utility setup tasks.
Facility Support
After an office opens, the facility center generates more time for selling by reducing the time devoted by franchisees to facility administration. - Office Utilities Support
Bill paying and other routine office tasks distract franchisees from customer sales and service. The facility center pays utility bills on behalf of franchisees and the checks are recorded on the franchisee's monthly statement. When practical, the facility center consolidates utility billings and negotiates for volume discounts.
- Office Computer Support
During office setup, a router is typically installed that permits computer support personnel direct Internet access to a franchisee's computer for troubleshooting purposes. When a problem arises, the problem computer is usually switched with a new computer from the facility center's inventory. If necessary, a computer is sent via overnight delivery to help ensure minimal downtime.
- Emergency Assistance
The facility center has staff on duty 24 hours a day, seven days a week to help franchisees in the event of an office or computer emergency.
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