Inside a Franchise Operations Manual

By Kerry CroccoOctober 22, 2019

When you're awarded the rights to start a franchise, the franchisor will provide you with a business blueprint stipulating the procedures of running your business. The instructions contained in this document help you maintain the the franchise system’s intellectual property and offer quality services in your new store or business. In short, it outlines the parameters within which you should operate. This blueprint is the franchise operations manual.

meeting discussing the franchise manual

The primary purpose of this document is to instruct you on how to operate the business; it is not persuasive or fluffy. Instead, it is concise, written in bullet point formt and has charts and other graphs and illustrations.

The operations manual contains confidential information from the franchisor to the franchisee about the systems, procedures as well as operations of the business. Namely, it covers the “how-to” guides that make it easy for the franchisee to operate.

Also, it serves as a legal document through which a franchisor advises the franchisees about the elements of the business, including the marketing, procurement, and other operations. This includes the exclusive suppliers from which the franchisee can buy products and ingredients.

Contents of the Franchise Operations Manual

The layout or format that each franchise system uses can vary. The operations guide could be in the form of conventional print or in digital content such as videos. It doesn’t matter how the franchisor presents the document as long they convey the information. The content addresses quite a few topics such as:

1. Confidentiality of the operations manual

The document needs to disclose to the franchisee that the document contains confidential information and must remain private. Then, the introduction outlines what role the manual will play in the franchise system and how it should be used. Also, it mentions any updates the manual may have and any legal disclaimers worth mentioning.

2. About the Franchise

The second objective of the manual is to tell the franchisee about the brand. It's a chance for the franchisor to tell the new owners about the business. The section empowers the franchisees to replicate the brand quality and standards to the new business.

The franchisees, though not from a legal perspective, serve as business partners to the parent company. This section of the document should help them to imitate the mindset in the business. Therefore, franchisees and their employees can follow the parent company's policies and procedures, especially with customer service.

The "Our Story" section should also inform the franchisee about the founders and management team and protocol. It should also tell them about the potential customers, services and products offered.

3. Operations of the business

The third important part of a franchise operations manual communicates how the business operates. Here, the franchisor trains the franchisee what the company does and the procedures to do it. This section describes the products and/or services offered in the business. So, this part has two sections: the description and the explanation.

Some of the information contained in this section includes the following:

  • Services and products offered
  • How to provide the services or products
  • Process of developing the products
  • The prices and pricing formula
  • Exclusive suppliers
  • Customer support and service
  • Human resource management
  • Accounting

4. Marketing and development

The fourth objective of the manual is to inform the franchisee about their role in marketing the products and services within their region. In this section, the franchisor educates the franchisee on how to promote and manage the business effectively. Here, the franchise owner learns how to make use of the tools provided to them to increase sales. The content in this section includes information about:

  • Marketing strategies based on the franchisor’s case studies
  • Using the company’s website
  • Social media and email marketing

5. Suppliers, ingredients, procurement, and signage

The other goal of an operations manual is to instruct the franchisees on the exclusive supply chain and, with food franchises, approved ingredients. This section outlines in detail any products that must be used to make the signature flavors or styles of the company. Further, the document illustrates how to obtain these ingredients from approved suppliers.

It is in this section, you'll find detailed information about recipes, restrictions, and signage as well as other instructions about product and brand compliance. In most cases, this section is used as a reference guide where you might find:

  • List of accredited suppliers
  • Insurance for the maintenance
  • Approved ingredients and services
  • Construction and design layout
  • Using the management systems
  • Process of requesting the approval of other suppliers
  • Templates of answering emails and phone calls

The franchise operations manual may vary between a company or an industry. However, the content discussed is primarily what you’d find in a standard document.

Resources
https://www.franchiselawsolutions.com/franchising/franchise-operations-manual/
https://www.msaworldwide.com/blog/franchise-operations-manual/
https://jcheathampr.files.wordpress.com/2012/07/wave-energy-drink-franchise-operations-manual.pdf
https://www.franzoom.com/wp-content/uploads/samples/FranchiseOperationsManualTableofContents.pdf
https://www.franchiselawsolutions.com/franchise-agreements/

About the Author - Kerry Crocco

Marketing Coordinator for Franchise Solutions and Franchise.com; conduct email marketing campaigns, web page management and trade show coordination. Mother of two, wife and Young Living Essential Oils representative.
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