2011 Company ABC Inc.

Confidential

Operations Manual

How to use this manual to develop your

own franchise
About this manual
In the following guide you will find the foundational building blocks necessary
to create an operations manual for your company. A well-written operations
manual enables your franchise branches to represent your brand consistently
and profitably. It also provides a great opportunity to clearly define your
business operations. While every successful business has a general idea of
their operations, few know their business at the level of detail the operations
manual demands. By investing the necessary time and resources to complete
this manual, not only will you be on your way to franchising, your existing
business will benefit greatly as well.

The importance of developing Standard Operating Procedures

As you read through this manual, you will begin to understand the importance
of developing a set of standard operating procedures (SOPs). A key factor in
building a successful franchise is standardization. Regardless of the franchise
location and ownership, standardization ensures customers will always be
met with a consistent experience. For example, McDonalds is regarded as
one of the worlds most successful franchises. Thanks to standardization,
their food is the same whether youre in Baton Rouge, Louisiana or
Albuquerque, New Mexico. You always know what to expect when you see
those golden arches.

The purpose of this manual

This manual was created using a fictitious window cleaning company named
Company ABC. This content was provided to give you an example of a
typical operations manual. As you customize the document to reflect your
business, the name and many of the details will change. We recommend you
save multiple copies through the writing process. This will allow you to refer
to this document as the master template and your document as the new
customized operations manual.

Guidance boxes
Weve also included valuable text boxes with questions, notes and additional
information to help you write each section. Read each box carefully before
beginning each section. An example of guidance box:

2011 Company ABC Inc.

Confidential

Operations Manual

Guidance Box

Introduction pages
At the beginning of each chapter you will find a page outlining the goals for
that chapter, questions to ask yourself, required materials and other important
information to review.

Guidelines for preparation of the manual

Remember, the operations manual is a living, breathing document. As

such, the contents will continue to change over time right along with your
franchises standard operating procedures. Therefore, prepare the
manual in manner that accommodates updates as they may occur from
time to time.

Many new franchisors do not have a written set of SOPs. Your

franchisees will likely have little existing knowledge of your industry. The
manual should be written in a manner that is easy to understand, even for
the complete layperson. Manuals that are too complex or overly technical
will be of little or no use to your franchisees.

Leave no stone unturned, no detail unaddressed, and no procedure left to

the discretion of your franchisees. Detail, detail, detail.

Your manual should address different operation procedures, if any, as

they relate to differences in geography, population, and other conditions
that could affect the successful operation of a franchise.

Maintain consistency between the manual and FDD. Discrepancies

between the two documents could lead to legal trouble down the road.

Obtain legal review. It is absolutely critical that you acquire local legal
council to review your operations manual, franchise agreement and FDD.
We are not legal experts; entering into franchising without legal oversight
is an accident waiting to happen. Because franchising is such a litigious
industry it is critical you do not skimp when finding an attorney. Your
attorney must have a long track record of specializing in the franchise
industry.

Lets get started!

2011 Company ABC Inc.

Confidential

Operations Manual

Table of Contents
How to use this manual to develop your own franchise ..................................................... 1
CHAPTER 1: INTRODUCTION ......................................................................................... 8
How to use this manual ...................................................................................................... 8
Confidential Disclosure Agreements ................................................................................ 10
CHAPTER 2: WELCOME TO COMPANY ABC .............................................................. 15
History of Company ABC .................................................................................................. 16
The Company ABC Management Team .......................................................................... 18
Legal advisory and franchisors management support ..................................................... 19
Company ABC Mission Principles & Promises ................................................................ 20
CHAPTER 3: SUPPORT RESOURCES .......................................................................... 23
Franchisee support matrix ................................................................................................ 24
Franchise Corporate Officers ........................................................................................... 26
CHAPTER 4: PRE-OPENING TIMETABLE & OBLIGATIONS ...................................... 27
Company ABC pre-opening timetable .............................................................................. 28
Week One ......................................................................................................................... 31
Week Two ......................................................................................................................... 32
Week Three ...................................................................................................................... 33
Week Four ........................................................................................................................ 36
Week Five ......................................................................................................................... 40
Week Six........................................................................................................................... 42
Week Seven ..................................................................................................................... 47
Week Eight ....................................................................................................................... 54
Week Nine ........................................................................................................................ 55
Week Ten ......................................................................................................................... 56

2011 Company ABC Inc.

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Operations Manual

CHAPTER 5: FRANCHISEE TRAINING REQUIREMENTS ........................................... 62

Company ABC Orientation Training ................................................................................. 64
Company ABC qualified certifications .............................................................................. 69
Additional training & refresher courses ............................................................................ 70
Annual Company ABC national sales meeting ................................................................. 72
CHAPTER 6: STAFFING YOUR COMPANY ABC FRANCHISE ................................... 74
Staffing your Company ABC franchise ............................................................................. 76
Position descriptions with profiles..................................................................................... 78
CHAPTER 7: OFFICE POLICIES .................................................................................... 80
Setting up your office ........................................................................................................ 81
Quality Standards of Service ............................................................................................ 82
Service and courtesy to clients ......................................................................................... 85
Handling typical complaints and problems ....................................................................... 86
Employee appearance (trade dress) and hygiene ........................................................... 87
Visitors in the workplace ................................................................................................... 88
Computer usage ............................................................................................................... 89
CHAPTER 8: OFFICE OPERATION AND MAINTENANCE ........................................... 90
Business processes mapping ........................................................................................... 91
General housekeeping ..................................................................................................... 92
Opening procedures ......................................................................................................... 93
Closing procedures ........................................................................................................... 94
Cleaning procedures ........................................................................................................ 96
Miscellaneous franchise duties and responsibilities ......................................................... 96
Office administration major activities listing ...................................................................... 97
Administrative management checklist .............................................................................. 98
Material Safety Data Sheets (MSDS): ............................................................................ 100
Alarms, locks and keys ................................................................................................... 100

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Operations Manual

Inventory levels ............................................................................................................... 100

Daily procedures ............................................................................................................. 100
Restrooms ...................................................................................................................... 100
Safety.............................................................................................................................. 101
CHAPTER 9: OFFICE EQUIPMENT, COMPUTER SYSTEM, INVENTORY, AND
SUPPLIES ...................................................................................................................... 102
Office equipment ............................................................................................................ 104
Approved vendors .......................................................................................................... 108
Equipment Starter Package ......................................................................................... 110
CHAPTER 10: ADMINISTRATION ................................................................................ 114
Record keeping .............................................................................................................. 115
Accounting services ........................................................................................................ 119
Collections and Accounts Receivable management ...................................................... 122
CHAPTER 11: REPORTS, AUDITS & INSPECTIONS ................................................. 125
Franchisee reports .......................................................................................................... 126
Records and reports ....................................................................................................... 128
Failure to report .............................................................................................................. 128
Audits and inspections .................................................................................................... 129
Contact with others ......................................................................................................... 129
CHAPTER 12: VEHICLE ADMINISTRATION ............................................................... 130
Auto theft & carjacking .................................................................................................... 133
Leasing ........................................................................................................................... 134
CHAPTER 13: MARKETING ......................................................................................... 135
Company ABC franchisee marketing requirements ....................................................... 138
Target marketing with selected media ............................................................................ 143
Executing your marketing plan ....................................................................................... 156

2011 Company ABC Inc.

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Operations Manual

CHAPTER 14: SALES & PRICING ............................................................................... 160

Introduction ..................................................................................................................... 161
Phone selling .................................................................................................................. 161
Referrals ......................................................................................................................... 165
Group presentations ....................................................................................................... 168
Pricing policies and fee structures .................................................................................. 169
CHAPTER 15: INSURANCE REQUIREMENTS & RISK MANAGEMENT ................... 172
General insurance coverage .......................................................................................... 173
Risk management ........................................................................................................... 176
Managing risk at the franchise location or job site ......................................................... 177
Franchisee site security .................................................................................................. 177
Reporting incidents ......................................................................................................... 178
CHAPTER 16: CORPORATE STRUCTURE AND FINANCING ................................... 180
Setting up your entity ...................................................................................................... 181
Legal business structures ............................................................................................... 181
Types of structures ......................................................................................................... 183
Setting up the new corporation ....................................................................................... 187
Financing arrangements ................................................................................................. 189
Financing alternatives ..................................................................................................... 189
CHAPTER 17: TRADEMARKS AND TRADE SECRETS - PROTECTION POLICIES 192
Patents, copyrights and proprietary information ............................................................. 192
Trademark usage and guidelines ................................................................................... 193
Examples Of trademark misuse ..................................................................................... 194
CHAPTER 18: FIELD OPERATIONS ............................................................................ 195
Safety first ....................................................................................................................... 195
Business processes mapping ......................................................................................... 196
Outline of the window cleaning process ......................................................................... 198

2011 Company ABC Inc.

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Operations Manual

CHAPTER 19: RESALE, TRANSFER, RENEWAL AND CLOSING ............................ 204

Conditions of renewal ..................................................................................................... 204
Continuation.................................................................................................................... 205
Assignment or transfer ................................................................................................... 205
Termination ..................................................................................................................... 208
CHAPTER 20: EXPANSION AND RELOCATION REQUIREMENTS .......................... 211
Franchise expansion, new territory, resale purchase or territory expansion .................. 211

2011 Company ABC Inc.

Confidential

Operations Manual