6 ideas for social venture franchising

June 16, 2015       The NonProfit Times      

The word “franchise” is likely to conjure up an image of one fast food restaurant after another popping up along a highway, but for-profit food service is not the only activity benefiting from franchising.

In his book “The Mission-Driven Venture” Marc J. Lane reveals that social venture franchising is an increasingly attractive business model for philanthropic ventures. It is a license to market a product or service in a standardized way, but for the mission-driven franchisee it avoids some of the risks of a new business without sacrificing the personal satisfaction of initiating one’s own venture.

Lane wrote that social venture franchising has certain appeals:

  • Existing goodwill. The franchisee will be dealing in a proven and well-known socially beneficial product or service.
  • Relatively small capital investment. The franchisor will have already undertaken substantial research, marketing and advertising, and the franchisee won’t be responsible for most of the costs.
  • Good help from the beginning. The franchisor might help select the site and help with other negotiations and can supply equipment and a time-tested design for layout.
  • Continuing managerial expertise. This might even include management assistance, employee training, inventory control aids, accounting help and more.
  • Mass buying power. A large franchisor can command volume discounts and pass them along to the franchisee.
  • Wide-area promotion. The impact of the franchisor’s advertising might do more for a small social entrepreneur than the franchisee ever could do alone.