Franchise research highlights need for better communication

Written on the 22nd of April 2010 by Fiona Taylor

Franchise conflict research findings released today reveal a need for greater transparency by franchisors to their franchisees.

The research into franchise conflict, conducted by Griffith University’s Asia-Pacific Centre for Franchising Excellence, was funded through an Australian Research Council linkage grant with the Australian Competition and Consumer Commission.

Lead researcher and Asia-Pacific Centre for Franchising Excellence Director Professor Lorelle Frazer said while results were relatively positive there were still areas that needed attention.

“Findings show three quarters of franchisees trust their franchisor to be honest with them, however it’s a little concerning there is still a quarter of franchisees who don’t trust their franchisor,” Professor Frazer said.

“Trust is the foundation of any strong and prosperous relationship, whether in business or otherwise.”

The franchise research also revealed only half of franchisees surveyed feel information communicated by the franchisor was accurate.

“So although franchisees may trust their franchisor they may question the accuracy of information presented to them, which highlights the need for franchisors to be more transparent,” Professor Frazer said.

The franchise conflict research findings also reveal while half of franchisees do believe in the accuracy of information provided by their franchisor, only half feel communication is prompt and timely – highlighting another communication issue.

“A recurring theme throughout franchise research conducted by the Centre is the importance of communication in a franchise relationship,” Professor Frazer said.

“Communication was given as the cause of major franchise conflict between a franchisor and franchisee in 9 percent of cases.

“By addressing communication issues as they arise, and putting proper structures and measures in place franchisors may be able to avoid or at least decrease conflict in their franchise business.”

The research was conducted through surveys with 350 franchisees from across Australia.

Other members of the research team included: Centre Deputy Director Dr Scott Weaven and Centre researchers Professor Jeff Giddings, Associate Professor Debra Grace and Anthony Grace.

Click here to view the full franchise conflict research report.