Co-Op: Franchises

I was explaining this plan to my sister in-law. At the time, I was exploring only a pizza shop using a cooperative approach. While my point was that scores of local owners makes it difficult for competitors, she brought up the idea of franchising the pizza shop. Franchises are not necessarily the way to go, but the idea needs exploring.

 

With a pizza shop, scores of local owners bring a competitive advantage. All those owners, buying pizza from their own shop, make that shop resilient and remove any advantage held by competitors. If we have a successful pizza shop in this town, it may be possible to open a franchise or second pizza shop in the next town over. If the second shop is close, some of our people would be able to pitch in, and some would patronize the shop. There are plenty of examples of small town pizza shops with a small chain of stores.

 

Putting the same shop in a town further away is a little tougher. We don't have the same word of mouth advertising from local owners which gives us a competitive advantage. As a company owned store, we would be just another pizza company. We'd be fighting head to head with the big corporations for market share. It better be a good pizza.

 

Using the same business model we started with, a franchise could be established in much the same way, with scores of local owners. We'd have to put together the specifications manual, operating procedures, and administrative structures to support these businesses, but it can be done.

 

To some degree, franchising flies in the face of the purpose of this plan. This is an open source business plan that anyone, or any group, can emulate. A franchise would limit creativity in favor of consistency. I think sacrificing flexibility would make it more difficult to establish and operate a cooperative enterprise. The point of the plan is to promote local ownership and relocalization. It is not well served with franchises outside of a local area. Nonetheless, with hundreds of people bringing their creativity to bear, the idea of developing a product or service which is well suited for franchising must not be ignored.

 

 

Cooperative Enterprise, Plan Outline