Restaurant Franchising, 3rd Edition

Franchisor–Franchisee Relationships 279

Financial capability of the franchisees should not be the only criterion.

Franchising is a long-term relationship, and the acceptance of unqualifi ed

franchisees has repercussions that will last for a long time. Poor perfor-

mance of a problem franchisee affects the performance of other well-qual-

ifi ed and hardworking franchisees and, fi nally, the entire franchise system.

Problem: Franchisor tries to expand too quickly and the system cannot

handle the strain.

Cause(s): Franchisor’s expansion plans are unrealistic.

Solution(s): Franchisor should reevaluate the expansion plan. The advi-

sory staff should also ...