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Social Franchising In Scotland

Franchising is a method of business expansion where an established company grants permission to a franchisee to use its brand name, product/service and processes. The franchisee pays the franchisor for this permission and is allowed to operate their own branch largely independently, with the added bonus of training, support, marketing assistance and other resources from the franchisor.

Social franchising works in a similar way, only it refers specifically to social enterprises who are looking to grow. It allows charities and non-profit organisations to expand the reach of their operations in new locations through a franchise model.

The obvious difference between traditional franchising and social franchising, however, is that the primary function of social franchising isn’t to maximise profits, but to achieve a greater social impact. (A social enterprise still needs to make a profit in order to survive, of course.)

This social impact could be anything from providing employment to disadvantaged people to tackling environmental issues. At The Franchise Company, we’ve worked with social organisations across a variety of sectors including mental health, education and children’s services, helping them to franchise successfully.

Social franchising is a relatively new concept. It only came into effect in the mid ‘90s, whereas the modern-day concept of franchising itself has been around since the 19th century. Due to the complex and unique nature of the issues that social enterprises serve to fix, there can be lots of variety in social franchising models. Some franchisors will want to maintain a high level of control over their franchisees and keep the funding centralised, while others will grant their franchisees more freedom and flexibility in how they operate.

In any case, a social franchise will want to ensure that their identity, values and social objectives are being fully realised and upheld by their franchisees.

Why Social Franchise?

Social franchising offers a wide range of benefits to your organisation, including:

  • Improving your social impact. By expanding your organisation into new locations and sharing knowledge, information and practices with franchisees, you’re able to positively impact more communities, transform more lives and achieve your mission as a social enterprise.

  • Allowing strong and financially-stable growth. Because you’re providing your franchisees with a proven model for success, social franchising can help you to achieve financial sustainability, longevity and effective expansion for your organisation.

  • Easier to raise funds. Being part of a strong social franchise network improves your chances of attracting investors/ donors and securing funding.

  • Quicker and cheaper way of expanding while maintaining brand integrity. The cost for wholly-owned growth in multiple cities/locations will not only be much higher than if you take the social franchising route, but you’ll be expanding your organisation in a way that creates distance from the frontline.

  • Low-risk model. Studies show that franchises are less risky than start-ups, primarily because they provide a proven model for success, with the added bonus of training, support, marketing and other resources from the franchisor.

  • Best of both worlds. Social franchising allows your organisation to reap the benefits of being a larger organisation (economies of scale, more bargaining power) while enjoying the advantages of being an independent brand (nimble operations, effective communication).

What’s The Process Of Social Franchising?

Assessment

The first thing we do is assess whether your organisation is suited to social franchising -- not just in the short term, but in the long term, too. There are many factors that we take into consideration and if it doesn’t make sense for your enterprise, then we won’t recommend it. We always give honest and impartial advice.

If we believe that social franchising is a viable option for your organisation, then our next step is to get to grips with your brand. We’ll examine everything from your finances and operations to marketing and competition so we get a thorough understanding of how your organisation works.

This allows us to create a bespoke franchise model that’s accurately tailored to your organisation. The model will be designed to maximise the impact of your organisation’s mission and uphold your brand values while ensuring its long-term financial sustainability.

Documentation

Once we have a personalised franchise model in place, we then put together the proper paperwork. This makes sure that all parties involved are on the same page, allowing the franchisor, franchisees and investors to understand their individual roles and responsibilities, as well as how your organisation works and what its objectives are. The documentation includes an operations manual, a franchise agreement, a franchise fee structure, a training programme and a territory analysis.

We’ll also help you to produce marketing and recruitment materials to promote your franchise and attract franchisees. Finding the right franchisees is essential to the success of social franchising. You need to find people who are competent, driven, motivated, reliable and passionate about your organisation.

Piloting the Franchise

Once our assessment, planning, documentation and recruiting phases are complete, it’s time to pilot your social franchise. We recommend starting out with one to three franchisees to help establish a strong foundation of franchises before expanding any further. We’ll create a feedback loop between you and your franchisees to improve operations, strengthen relationships and identify and resolve any issues.

If your pilot period is successful, we can help you to expand even further. Between training resources and marketing assistance to coaching/mentoring and franchisee recruitment support, we can provide you with the necessary guidance to grow your network of social franchises.
 

Why Social Franchise In Scotland?

Scotland is a fantastic place to franchise your social organisation.

The country welcomes social enterprises with open arms and offers a fantastic support infrastructure for social franchises. In 2018 alone, more than £5 million of grant funding was allocated to social organisations. This wasn’t a one-off occurrence, as there has been more than a decade of sustained investment in Scotland’s social enterprise sector.

There’s arguably not a better time to social franchise in Scotland. Currently in full swing is the Scottish Government’s 10-year Social Enterprise Strategy, which aims to develop the potential of the country’s social enterprise sector and support organisations that are dedicated to social change. It’s a mutually beneficial relationship: the social enterprise sector contributes £1.68 billion to the country’s economy each year and sustains more than 100,000 jobs.

Scotland boasts a rich heritage of social enterprise. It was at his New Lanark textile mill where social reformer Robert Owen tested his ideas (including the eight-hour working day) and pioneered the cooperative movement. The mill developed an International reputation and was visited by social reformers, statesmen and royals from around the world. With more than 5,000 social organisations currently operating in the country, Scotland remains a hotspot for social enterprise.

By social franchising in Scotland, you’ll be stepping into a culture that truly values social enterprise and tapping into a market that’s rich with suitable franchisees.

Scotland’s franchise industry as a whole is thriving. By 2020, the sector is expected to be worth as much as £1 billion. However, that doesn’t mean Scotland doesn’t still face its problems. Rising levels of poverty, unemployment and wealth inequality continue to plague the country. This only creates a bigger and more urgent demand for social enterprises. If you’re looking to expand your social organisation through franchising, Scotland presents a huge opportunity to deliver truly transformational change for local communities who need it.

By social franchising in Scotland, you will receive plenty of support from the government and other bodies, be welcomed into a country that values and is proud of its social enterprise efforts, and be able to make a real difference to the lives of people who need it.

Case Study

We’re currently working with Invisible Cities, a social enterprise that trains people who have experienced homelessness to become walking tour guides of their own city. They offer a unique, interesting and increasingly popular alternative tour for locals and tourists alike while empowering disadvantaged people with new skills, confidence and stability. So far, they’ve trained more than 50 tour guides across four cities.

Invisible Cities currently run tours in Edinburgh, Glasgow, Manchester and York, and are currently gearing up to launch a new operation in Cardiff in February 2020. With our help, they’re actively looking to expand further into Scotland through social franchising. We’ve assisted them in producing a Franchise Prospectus that is already attracting plenty of interest.

Why Choose The Franchise Company?

Since our beginnings in 1991, The Franchise Company has helped over 200 businesses and organisations across all different sectors franchise successfully.

Our founder Julie Waites is one of the leading voices on social franchising in the UK and has been asked to become a trustee with the Social Enterprise Academy, an international social franchise network. Julie has a real passion for helping social enterprises to expand their operations and increase the amount of good they can do in the world.

We have extensive experience in both social franchising and international franchising, making us uniquely equipped to help your social enterprise successfully franchise in Scotland. It may be a part of the UK, but Scotland has its own franchising regulations -- not to mention social, cultural and economic complexities -- so it’s important that you seek advice from the experts.

As a BFA-accredited franchise consultants, we’re here to help you successfully launch and operate a social franchise while giving you honest, straightforward and trustworthy advice every step of the way.

If you have a social enterprise and want to expand your operation into Scotland using a franchise model, contact one of The Franchise Company’s trusted advisors today.

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