Should a franchisor be carrying out research and development to improve the franchise?

The franchisor should have research and development facilities in relation to the products, services or system and the market image projected. It should constantly be seeking to innovate and introduce ideas and methods for improving the business of the franchised network and the operational systems.The franchisor should be experimenting with new product lines and/or the introduction of new or improved services. These products and services must be compatible with the existing business and should be thoroughly market tested before they are adopted. A franchisor with company-owned operations can conduct market research by offering the products and/or services in those operations to test the efficacy of their introduction. The franchisor may also involve some selected franchisees in market testing through their operations.All changes, whether to system, products or services, should be as carefully evaluated as the original operation that was the basis upon which the franchise was stated, so that the franchisor can demonstrate to franchisees the likely benefit that should result from their introduction.The research and development activities can extend to exploring new sources of materials supply or supplies/ products for franchisees, so that costs are kept to the most economic level possible. As the network grows its bulk purchasing requirements will also grow, resulting in considerable accounts with manufacturers and suppliers.This should produce valuable savings for each individual franchisee, since bulk purchasing can reduce prices and retrospective volume rebates can also be available.Manufacturers of supplies also promote products and provide marketing support that the size of the network’s account may justify. Benefits and savings can thus be obtained for franchisees that would not be available to them outside the franchise network, when they would only have their own individual resources with which to bargain.