Basic Steps for Success

Before even starting to think about social franchising, a social enterprise should
have a proven and successful business model that has been operating and
tested for some substantial amount of time. That literally means:

 It is safe with its economic numbers and has shown some good
revenues.
 It has put apart an amount of money that can be invested for the
expenses of realization of the franchising processes. That means that a
lot of people need to be paid (employees or other partners) in order to
prepare all the material and business plans for the expansion.
 Its brand name is well known and trusted in the specific geographic
location of its existence. That means people trust its products or services
which abide to a specific high standard.
 Over the years it has developed partnerships and good relations with
the local community, with financing institutions, donors, volunteers, and
with other social solidarity economy sector institutions.

Only after the above terms are fulfilled a social enterprise can think of getting
into the social franchising venture. The steps to be followed are:

 Prepare a business plan for the expansion.

 Prepare an operations manual (see details in the next text titled:
Operational issues)
 Compile the franchise agreement, which is a legally-binding text with
provisions for the important aspects of the partnership (see details in the
next text titled: Operational issues).
 Decide on the amount and the structure of the franchise fee (whether
it will be only initial, or only ongoing or even both).
 Build training procedures for the franchisees employees which means
decide how and when (initially or ongoing) the training of the franchisee
will take place and what it will involve.
 Develop a quality control system for the franchisees.

When preparations are over, the franchisor is ready to search for the proper
franchisees or he may already have a few candidates in mind. This is a very
important step as selection of the right franchisees will ensure the success of
the whole undertaking.

Franchisee selection: In order for the right candidates to be chosen the

following factors play a key role:

 A compilation on part of the franchisor of a description of the

characteristics that are essential for the franchisee
 Precise and complete informing of the candidates about the franchisors
social enterprise and mainly about its social mission
  Detailed screening of the candidates so that they fit to the description
and social mission of the franchisor

It is important that the selected franchises are enthusiastic about the social
cause at hand and that they will be committed to the values and aims of the
social economy enterprise. On the other hand, they should demonstrate a
certain kind of entrepreneurial spirit that is, of course, absolutely essential if the
whole undertake is to prove successful. Last but not least, franchisee
candidates should have an extensive knowledge of the location and the
community that they are going to settle their business in and maintain good
relationships with as many shareholders as possible.