Proven Systems?

Why does the everyone keep saying that franchises are "proven systems". 

Using the word "proven" is gratuitous and self serving.  I have not seen one UFOC that provides enough data to the use the word "proven" in any description.  Perhaps, you can point to some grand fathers of the franchising industry that can justify the use of "proven" only because historical data and shareholder approval, but most franchises get a lot of mileage out of throwing the term "proven" around with no means of backing up the word. 

I will go even further and submit that some concepts are the opposite of "proven" and that they are non-viable from the first day the doors are open.  And even worse, over an extended period time - after adding increasing product costs, increasing wages, added competition (in and out of the system) - that the viability falls even further.

Even systems with hundreds or thousands of stores can fall into the non-proven category as the franchiser attempts to pile additional requirements (fees) and modifications onto the franchise system with no regard to the bottom line.   I challenge the AAFD to make part of the accreditation process the task of providing sufficient data to justify that the Franchise is a "proven system".  If a franchise system wants to use the "proven", I say "ok, then show it". The franchiser cannot just point to corporate stores and "see" without coughing up the data behind those stores to justify their success. 

How about - as part of the accreditation process that the Average Unit Expenses be reported along with the Average Unit Volume?  Those franchises (franchiser and franchisee) who have been sensitive to the bottom line of the brand will have nothing to fear by providing this data.  Include the Average Unit Utilities, Average Unit Lease Cost, Average Unit Labor, Average Unit Product Costs.  These values weighed against the Average Unit Volume will give the franchiser, the franchisee, the market analysts and any future investor a snap shot of how "proven" the system really is.  Each of these numbers will be an indicator to how well the franchiser and franchisee have done during the quarter at working TOGETHER in promoting the brand.

Over a period of time the Brand improves in stability and quality because to attract future investors the franchiser will need to ensure that the reported Unit Averages reflected a truly "proven system".

I know, I know - don't hold your breath on that one….but it felt good thinking about how good it could be.

-jm