know how in a Franchise

What is the know how in a Franchise?

Posted on 06/07/2017

The know-how is the set of practices and knowledge obtained by an entrepreneur during the dedication and development of his/her business, and with which he/she has managed to achieve profitability and success.


This is delivered as a document for those who wish to acquire the brand as a business model. It must contain all kinds of experiences, both positive and negative.


When you decide to franchise your own brand, you must meet certain legal standards to offer it. And as time and market change, a business adapts its own management, and each owner learns how to manage it.


For this reason, it is essential to transfer as much knowledge as possible to the franchisees, since the prosperity of the business suits both parties; and if a franchise is successful under a proper business structure, it will allow the expansion of the brand much more quickly.

You might find interesting: Steps to franchise your brand


The know how should be a detailed and extensive document which will include all the essential aspects of the business. Aspects that make the difference compared to other companies. It must fit all commercial and technological advances so that in this way, the business can continue evolving.


It is important to include in the know how, the experienced failures, since thes enrich the learning and help to evolve the business. This evolution directly affects the commercial value of the brand, and thus increases its attractiveness.

The know-how should comply with a minimum of specifications, in order to fulfill its purpose. Within them:


  • Whats is being produced?
  • How is it produced?
  • What is the description of the sold product?
  • How is it sold?
  • How do you buy it?
  • What clients are you aiming the product to?
  • How are clients attracted?
  • What kind of processes are carried out?
  • How are these processes carried out?
  • Business flowchart, including responsibilities, functions and tasks
  • Shifts and work schedules
  • Petitions, Claims and Complaints Management


The value of a correct know-how is unthinkable. Many franchisees think it does not have enough or determined value.


On the other hand, the know-how directly affects the opening investment cost, since "knowing how" to open a first branch is not the same as opening the second one (notice that 80% of new businesses fail before their first 5 years, while franchise-based businesses show overcoming this barrier at a 90% of the cases) and opening the second branch is not the same as opening the 100th one. For this reason, the know-how must be constantly updated and renewed, renewing all the good behaviors that appear at the opening of each branch.


In this way, knowing how to guarantee the good use of the product and the brand, is what offers credibility and guarantees stability.

See: What is and how The Uniform Franchise Offering Circular works



Please rate this article: 
[ Votes: 3, Average: 3.7]

Add new comment