Franchisors are finding that multi-unit operators tend to need less help in running their franchise. The result is that those operators, when either buying into another franchising system or renewing their agreements, are looking to fit their fees to services they need. They’re reassessing the talents and resources of their franchising infrastructures and finding that, in many cases, the tools they have in place outstrip what a franchisor, especially a new one, can offer them.

For example, most traditional franchise agreements call for an initial franchise fee, usually broken down to the per-restaurant level. A pizza operation, such as Papa John’s at $25,000 for the initial fee, might require more oversight and input from the corporate level than a Subway sandwich shop at a $12,000 franchise fee. Royalty rates for those same businesses run 4 percent for Papa John’s and 8 percent for Subway, excluding required contributions for advertising.

For that money, and subsequent fees, franchisees have traditionally relied on the franchisor’s corporate office for help in site location, selection, development toward opening day, and then further operational support to ensure that the store’s opening went smoothly. Deeper than that went help for staff development, local advertising support, and consultation visits.

While those services are certainly touted by franchisors proud of the expertise they offer to franchisees, multi-unit operators are telling franchising experts that “one size fits most” does not work for a modern franchising model.

That leaves franchisors trying to balance having a responsive, helpful support network with the idea of a franchisee group that can have almost as sophisticated a corporate structure as the brand. That franchisee expects support from the corporate office, but the type of help needed will be far different than what might have been envisioned when the franchise agreement and fee schedule were originally set.

“What franchisors are struggling with is do we make these changes incrementally or roll them all in as part of the deal,” observes Darrell Johnson, FRANdata president. “You just can’t look at it anymore and say, ‘What is the rate?’”

Another argument for brands having kept things simple for so long is because they did not want to alienate individual unit operators. Once the backbone of franchising, single owners who do not have backgrounds in franchising or restaurants need a full spectrum of services. Asking a franchising newcomer to select which service and fee schedule would suit him would be futile and counterproductive for both parties in the franchise agreement.