Search Icon
search_close_button
1
FREE Latest Issue
Q.

What does the term ‘pilot franchise’ mean?

Author: Vicky Wilkes

answered by Vicky Wilkes

Senior Associate at Squire Patton Boggs (UK) LLP

A ‘pilot franchise’ is the name commonly given in franchising to a test phase that aims to establish whether a proposed franchise is conceptually and financially sound, prior to becoming a full-scale franchise operation. A pilot franchise should allow both a franchisor and pilot franchisee to operate the franchise business with the aim of identifying any problem or potential problem areas, and consider any lessons that can be learned from operating it.  It should help a franchisor to reflect on the results of the test run and assess whether franchising is right for its business and adjust, where appropriate, various aspects of the franchise operation before the franchise concept is launched on a full scale.  A pilot franchise should operate in similar circumstances to those that will be operated by a franchisee. It typically needs to be run for at least 12 months, or longer if there is a seasonal element, to allow proper time to assess the effectiveness of the franchise.  In the event that a pilot fails, it justifies its value by averting more serious consequences of a fullscale operation.

What Franchise Suggests

Our suggestions of top rated franchise opportunities

Other Running a Franchise Q&A

  • Q. Who sets employees’ salaries in a franchise?

    answered by John Pratt

    Senior Partner at Hamilton Pratt

    John Pratt writes: The important point to remember, in relation to franchising, is that the franchisee’s business is theirs - it is not the franchisor’s. Franchisees generally make all business decisions, subject...

  • Q. What Is My Status As A Franchisee?

    answered by Shelley Nadler

    Legal director at Bird & Bird

    Shelley Nadler writes: As a franchisee, your status is that of an independent business person entering into a contractual relationship with a franchisor for the right to carry on a business format...

  • Q. If I Buy A Franchise, Who’s In Control Of The Business?

    answered by Brain Duckett

    Chairman of The Franchising Centre

    Brian Duckett writes: Assuming you’ll be the majority shareholder and will take day to day responsibility for the operation of the business, you will be most definitely in control. However, the purpose...

Ones to Watch

Franchisors provide an insight into how they’ve built their businesses.

This Month's Best Opportunities

Our other business brands