Q.

What information should a franchisor’s operations manual contain?

Author: Shelley Nadler

answered by Shelley Nadler

Legal director at Bird & Bird

It will contain in a written or electronic form the complete systems and method for conducting the franchise, including the franchisor’s ideas, know-how and trade secrets, as well as the day to day instructions for the operation of the business. 

The manual should contain an introduction explaining the nature of the operation and the business philosophy of the franchisor. It should set out what the franchisee should expect from the franchisor and what the franchisor will expect from the franchisee.

There should be a detailed description of the operational system, which explains how the operation is set up. There should also be a section dealing with the equipment that’s required for the operation of the business. It should give an explanation of what the equipment is, what it does and how to operate it. Details of suppliers and maintenance companies may also be included. 

There will follow the operating procedures, which may deal with staff and training, purchasing policies, product and service standards, accounting and reporting, advertising and marketing, insurance and stock control. 

It’s usual to include a section on the franchisor’s social media policy for franchisees and their employees. There may also be a section setting out the standard forms used in the business, such as customer contract forms and contracts of employment.

The exact contents of the manual will depend on the type of business operated.

Shelley Nadler is a legal director in Bird & Bird’s international franchising team and has many years’ experience of advising on all aspects of franchising.

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