Criteria and checklist for membership
Joining the British Franchise Association involves a rigorous accreditation of a franchisor's history and standards, which is why membership is important for the credibility of any brand that's proud of its model and wants to attract the best franchisees to its network.
Members commit themselves to comply with the terms of the following bfa policies and procedures:
- The Code of Ethical Conduct
- The Disciplinary Procedure
- The Complaints Procedure
- The Appeals Procedure
Members also agree to comply with the Code of Advertising Practice as published by the Advertising Standards Authority.
Members agree to provide to the Association any non-confidential information relating to their franchise business or relating to the standing and qualifications of its directors, as may be requested by an authorised official of the Association.
Members also agree to provide a full-time official of the Association access (at reasonable times and on reasonable notice) to confidential information relating to the franchise and its standing (on the understanding that such information remains confidential to the authorised official).
The bfa operates an informal conciliation scheme, and facilitates mediation and arbitration schemes. These services are available to franchisor members and franchisees who jointly agree to the use of these schemes.
Members of the Association also seek to comply with the spirit and intent of the Guidelines to Best Practice as published by the Association from time to time.
In respect of both the foregoing general conditions of membership, and the following specific terms, whilst the Association will use its best endeavours to establish the eligibility of an applicant, the onus for demonstrating that the criteria have been met on initial accreditation or re-accreditation lies finally with the applicant.
Full and Associate Members
All Full and Associate members of the bfa must meet four key criteria: that the business is viable, franchisable, ethical and fully disclosed.
These principles underpin the accreditation process before membership is granted. As part of their application, franchisors are expected to demonstrate how they meet these standards and provide evidence of the same, where appropriate.
- Viable: The business will have evidence to show that the product or service is saleable, and at a level of profit that will sustain a franchised network.
- Transferable: There is a means for the transfer of the know-how to a new operator at arm’s length, essential if the business is to be franchised.
- Ethical: The franchise is structured and operated in accordance with the ethical principles set out in the European Code of Ethics for Franchising, which covers matters of advertising, recruiting, selecting, and interactions with franchisees. The applicant’s franchise agreement is formally assessed.
- Disclosed: All information on the business that is material to the franchise proposition and contract is disclosed without ambiguity to prospective franchisees.
With these checks in place, franchisors can be admitted to membership, providing also that they commit themselves to abide by the Advertising Standards Authority’s code of practice and also to the Association’s own complaints and disciplinary, appeals and re-accreditation rules. Full members will have a proven trading and franchising record.
The length of time a franchised business has been in operation, and the changes in business and financial circumstances it must have survived before it can be said to be “established”, vary from sector to sector.
Full Membership: To become Full Members, franchisors must prove a sustained trading, financial and franchising record over a period of time. The record of Full Members on openings, withdrawals and failures (if any), as well as their trading and financial performance, is subject to an initial assessment and periodic re-accreditation.
The requirements for Associate Membership are the same as for Full Membership, except that the criteria relating to the length of time the franchise has been operating, the size of the network and the range of experiences, are less demanding. Associate Members are franchisors working their way towards Full Membership. The bfa will determine whether a franchisor applying for membership is suitable for Associate or Full Membership.
Provisional Listing is available to businesses with a successful trading record in the UK of at least one year and that are in the process of developing a franchised business (most often with a pilot operation at this stage, whether franchised or company-owned).
The business will have offer documents that are free of ambiguity and misleading statements, and any direct or indirect references to future trading potential will be objective and based on actual experience.
It will already have a franchise agreement that meets the bfa’s Code of Ethics and will be able to demonstrate that its development programme is founded on good franchising practice. Provisionally Listed companies commit to complying with the conditions of membership and to work to achieving the standards for Associate Membership within two years.
Affiliate Members are professional advisors (such as solicitors, banks, accountants and so on) who have been accredited on the basis of their proven professional skills and the successful application of those skills to franchising.
They undertake to ensure that the advice on franchising that they provide to clients is of a standard consistent with the aims and objectives of the European Code of Ethics. The involvement of bfa-affiliated advisors in the development of franchise companies is one of the measures the bfa uses in assessing companies for Provisional Listing.
Affiliate membership is limited to six core discipline areas:
- Finance (banks and accountants)
- Franchise consultants (business development)
- Franchise consultants (recruitment and brokers)
- Recruitment media – websites
- Recruitment media – magazines and newspapers
Franchisees of accredited bfa franchisors are encouraged to join the Association, where they can receive business benefits, cost savings and influence the future of UK franchising. For more information see the Franchisee Membership section.