Why Should You Join the British Franchise Association?

Originally posted on 25/09/2017. Updated on 20/04/2019.

The British Franchise Association (bfa) regulates the franchising industry to protect franchisees and customers who use the services of franchised businesses. The regulatory body ensures that those who receive its stamp of approval offer a franchise opportunity that has potential for success and sets out fair terms for franchise partnerships. In order to achieve full membership of the bfa, franchises need to apply to be tested against strict, extensive accreditation criteria to prove that they’re worthy of the prestigious member status.

The bfa was set up in 1977 to establish an industry-wide standard of best practice for franchises across the country. Before this, there were no guidelines or regulations for companies in the world of franchising, meaning it was difficult for prospective franchisees to work out if a franchise opportunity was worth the investment or not. The reputation of the industry was suffering, as it was plagued by scammers pretending to offer legitimate business opportunities. Something needed to be done.

So, eight of the biggest franchises in the country – which included well-known business such as Dyno-Rod, Kentucky Fried Chicken, Holiday Inn UK and Wimpy International – came together to do something about it. The businesses set up their own association that would act as a regulatory body for the franchise industry, protecting prospective franchisees from scams and illegal pyramid schemes that masqueraded as legitimate franchise opportunities. It was also hoped that it would stop individuals starting a franchise that had very little potential for success or even a return on the initial investment.

Since the bfa was founded, franchising as an industry has experienced huge growth and almost 1000 brands are currently operating in the franchising industry. It has also launched its own industry recognised qualifications, such as the QFP (Qualified Franchise Professional) accreditation, teamed up with major bank HSBC to host an annual awards ceremony and educational franchise seminars across the country.

Read more:

• What is the British Franchise Association?

What standards must be met for franchisors to become members?

There are four criteria on which a franchise will be assessed. Franchisors will have to prove that they can achieve the required standards as set out by the bfa. The franchise must offer something that’s:

• Viable – a franchise must be able to show that the product or service it provides is easily marketable and profitable enough to support a network of franchisees.
• Transferable – a franchise must be able to share the relevant information with new franchisees so that they’re able to run their operations with relative ease. If it’s tricky to explain to franchisees how to operate a new location of a business, it won’t be up to par.
• Ethical – a franchise must comply with the European Code of Ethics for Franchising and must make it clear to all prospective franchisees in the franchise agreement that it does so.
• Disclosed – franchisees must be able to access relevant data, statistics, and financial figures regarding the franchise proposal in a way that’s clear and easy to understand.

Why franchisors should join?

Although becoming a member can seem like a rigorous process, benefits of joining the bfa include:

• Benefitting from the excellent reputation of the bfa and establishing your business’ status as a legitimate, ethical franchise opportunity. Pop the bfa badge on your website to show that your business is the real deal.
• Easier franchisee recruitment thanks to the bfa’s status as the go-to for those looking to enter the world of franchising. Appearing on the bfa website will drive potential franchisees to your opportunity.
• Access to five annual bfa exhibitions annually, which offer the chance to network, learn and meet potential new franchisees.

Why franchisees should join?

It’s surprising how much franchisees can benefit from joining the bfa too. Reasons to join include:

• Money-saving incentives – members of the bfa can access discounts on everything from airport parking to high-street retailer gift cards, making their money go even further.
• Improved local profile – network with other franchisees and raise your local profile through the bfa’s Local Franchise Networks.
• Personal improvement – through the bfa you’ll be able to access a wide range of resources that will help you become a better business person. From online courses to helplines covering everything from financial aid to office tech skills, you can learn how to run your business in the most efficient, effective way.

How much does it cost to join?

Let’s start with the easy answer. For franchisees of a bfa member franchise, the membership fee is only £10 plus VAT per month.

Now, for the more complicated franchisor membership fees. The subscription rates are banded depending on the number of franchisees in the business.

Banding Annual Subscription

Band 1 (0-5 franchisees) £2,192.16 + VAT Band 2 (6 – 25 franchisees) £3,256.44 + VAT Band 3 (26 – 100 franchisees) £3,761.40 + VAT Band 4 (100+ franchisees) £4,837.32 + VAT

If a franchisor operates more than one branded franchise, then additional fees are applied:

• First additional brand: 50 percent of the relevant banding
• Second additional brand: 25 percent of the relevant banding
• Third and other additional brand: 10 percent of the relevant banding

The above fees are only paid when bfa membership has been approved and there is no charge for the accreditation process.

And remember…

Just because a franchisor has membership of the bfa, it doesn’t mean you’re guaranteed to succeed. You must still make sure you carry out plenty of research before signing yourself up to any opportunity. Even though the stamp of the bfa tells you that a business is legitimate, not all businesses that are accredited offer the same potential for growth and profit. Educate yourself on the risks and potential returns of each franchise before entering into a franchise agreement, as it’s a legally binding document that can be tricky to get out of if you realise you’ve made a mistake. Using the bfa as a tool to aid any decisions made, as well as appointing a bfa affiliated solicitor for advice and expertise, is the only way to confidently enter the world of franchising.