Franchise and sustainability: a happy combination

As a franchisor within retail, there have been several developments recently that have required your attention. From the Corona crisis, to disrupted supplier chains and a huge increase in the cost of energy. Since Jan. 1, 2023, your franchise agreement must be in line with the provisions of the Franchise Act. All in all, a time with a lot of movement, and with it opportunities. Niels van den Bogaard explains.

As a franchisor, how can I implement sustainable business practices?

Sustainability of the franchise relationship.

One possibility is the sustainability of the franchise relationship with your franchisees. So what can you think about?

By involving your franchisees in decision-making more, than you already do. Under the Franchise Act, under certain conditions, franchisees have the right to consent to decisions made by you as the franchisor. For example, regarding the intention to change the franchise formula, or the operation of a derivative formula.

In addition, the Franchise Act explicitly requires consultation between you and your franchisees. As a franchisor, it is therefore advisable to create a forum for this purpose. Sustainability of the formula as an agenda item during such a consultation can lead to innovative insights.

Making your real estate more sustainable

Another possibility concerns the preservation of your franchise property, through the:

• energy label requirement under the Energy Performance of Buildings Decree;
• obligation from January 1, 2023 making it illegal to occupy office buildings of 100 m2 or larger without a valid energy label C(Article 5.11 of the Building Code). For that, see this blog by my colleague Jeroen Brinkman;
• requirements under the Nearly Energy Neutral Buildings (BENG) (section 5.2 of the Building Code);
• energy-saving obligations included in the involving several of the energy-saving measures, regardless of whether or not the property in question is covered by the obligations, are extremely opportune to take given the great uncertainty in the energy market(Section 2.15 Environmental Management Activities Decree).

Sustainability of working conditions

If you provide your franchisees with a format of an employment contract, you can include in it a sustainability of the terms of employment. There is room for this within the free space in the work expense scheme. You can read more about this in this blog written by my colleague Sander Poelman.

The following, of course, also applies to the terms and conditions of employment that you, as a franchisor, apply to your employees.

Consider, for example, the:

• Offer additional compensation for transportation by train (or other environmentally friendly form) compared to car;
• Facilitate a "company bicycle.
• Offering a sports subscription;
• Making available a one-time budget to be used for making one's home more sustainable, for example, to be spent on insulation measures, solar panels or energy-saving household appliances.

Franchise and sustainability, a happy combination

Based on the above sketches in a limited number of areas, various sustainability opportunities can already be identified. And that is not counting formulaic subjects such as purchasing, sales and logistics. A symbiotic relationship such as franchising therefore lends itself well to sustainability on a broad front. Should you require further clarification, please contact me or my fellow specialists for personal advice.

This page was last updated on August 14, 2023.