Social franchising

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In social franchising , the techniques of commercial franchising are adapted to projects in the non-profit sector in order to achieve public welfare purposes.

definition

The division of labor is defined in a contract between a franchisor and several franchisees. This business concept is based on a "prototype" that has been successfully tested in practice and is implemented by the franchisees in a decentralized manner and with limited adaptation to local specifics.

Furthermore, there are basically three different forms.

a commercially organized franchise
the focus is not on individual gain, but on social benefit and social progress.
a subsidized system
through subsidies , services can be offered more cost-effectively than for profit-oriented entrepreneurs.
Non-profit replication process.
It differs most from the commercial version as it only has the essence of franchising, not the profit orientation. It can still be divided into two types:
Network franchising
Replicates complete solutions. Partial products or services are linked to form a whole. The members of the network, the franchisees, work out partial services that are coordinated by a head office to form an overall service. The franchising of products and individual services does not play a role here, but the coordination of concepts and know-how. The complexity of non-profit projects can therefore be better addressed.
Master Franchising
Master franchising is suitable for both the commercial and the non-profit sector. The franchise system is supplemented by a further level. The franchisee takes over the distribution rights for a franchise concept for a selected area. The main difference here is that the latter tries to acquire further franchisees in order to ultimately build a functioning franchise system on their own responsibility.

For the nonprofit sector this means: International projects and social institutions benefit from this form of franchising, as it can be spread over a large area.

Difference from commercial franchising

The differences between the social organizations in terms of financing, corporate goals, etc. require the franchise system to be adapted. The following 'basic building blocks' are available in profit-oriented and social franchising:

  • a successful prototype and expansion
  • a manual
  • a brand name
  • a contract
  • standardized training
  • systematic assessment methods

However, there are differences between commercial and social franchising:

Different objectives
Non-profit organizations strive less for profit maximization and more for social benefit. The result is that franchisors are more sensitive about their agents.
Different target groups
The third sector includes services that are used by certain 'customers'. On the one hand, this means that a higher level of loyalty can be expected and, on the other hand, that the organization cannot expect direct payment after the service has been performed. This in turn means that the approach to the beneficiary is different.
Additional actor
As a rule, beneficiaries of a service do not pay themselves. This results in financial dependence on a third party. This means a disadvantage for start-ups, as they have to coordinate any controversies with the sponsors and the company's goals.
No transfer of investment risk
In contrast to commercial franchising, in social franchising there is generally no or only a limited transfer of the investment risk from the franchisor to the agent. That has its advantages and disadvantages. Because the risk that the franchisee has with the use of his own capital in the conventional system increases his motivation. The Federal Association of German Foundations argues that “an important impulse is missing in social franchising”. On the other hand, the franchisee is also relieved of the pressure and the federal association opposes the motivation of maximizing social benefit to the previous argument.
Franchise fees
It is not always possible for a franchisee to pay a fee in social franchising, as high returns are not to be expected. The franchisor must therefore be satisfied with a small amount or non-monetary means. These can be, for example: receiving important data or information about quality. In this way a project of the principal can be further developed.

chances and risks

Opportunities:

  • faster and more efficient replication of non-profit projects
  • continuous further development of the system through systematic development
  • Know-how transfer and further training
  • simplified quality management through standardization
  • financial benefits
  • Advantages through network synergies
  • Easier acquisition of volunteer employees

Risks:

  • Risk of dilution of the originally intended objective
  • Risk of image loss
  • Difficulties in control and assessment
  • Problems of standardization
  • Competition for donations

Examples

In Germany belongs Wellcome to the best known representatives of social franchising. Wellcome is a social and non-profit project to support families for one year after the birth of a child. At the end of 2013, the organization consisted of 250 teams in 15 federal states. This idea has received several awards, such as B. with the Social Entrepreneur 2007 of the Schwab Foundation .

Other social franchise systems are Joblinge , Youth-to-Youth , the START Foundation , Aflatoun , Dialogue in the Dark , Knirpsenparadies , Hauptschul-Power , MUNTERwegs , Fairplay Franchising , ROCK YOUR LIFE! , CAP markets and the Bürgerermut Foundation .

literature

  • Bröker, Jasper J. (2005): Successful management of complex franchise systems based on the Viable System Model, Diss., Bamberg (pdf; 3.3 MB) online
  • Deutscher Franchise Verband eV (Ed.) (1999): Business start-ups with a system - The guideline of the German Franchise Association eV, Bonn
  • German Foundation for World Population : Social Franchising - A Worthwhile Alternative for Development Co-operation. Documentation of the workshop on social franchising of the German Foundation for World Population in cooperation with Wellcome Trust , Hanover, 2001
  • Eschenbach Rolf u. Horak Christian (ed.): Leadership of the Nonprofit Organization , 2nd edition, Stuttgart, 2003
  • Evers, Adelbert: Social Enterprises - A Proposal to Rethink the Future of Public Social Services . Published in: Publications of the Heinrich Böll Foundation Bremen, 2002
  • Herz, Peter: Self-employed with a franchise: Financing - Concepts for success - Risks , Regensburg / Bonn, 1997
  • Kirst, Andreas: Limits of self-interest - the importance of social preferences in franchising , 1st edition, Wiesbaden, 2007
  • Köchling, Egbert: Financing and Law of Social Institutions - Basics for Practice , Hannover, 2004
  • Kubitschek, Christian: Franchising - efficiency comparison with alternative sales concepts , Wiesbaden, 2000
  • Lahme, Cornelius: Social Franchising - Systematic Scaling of Socially Relevant Activities, Wiesbaden, 2018
  • Markmann, Frank: Franchising in groups - an economic analysis of the institutional barriers to its implementation , 1st edition, Wiesbaden, 2002
  • Maelicke, Bernd : Strategic corporate development in the social economy , 1st edition Baden-Baden, 2002
  • Maelicke, Bernd : Innovation and Management in the Social Economy , Neuwied, 2005
  • Mühlhaus, Karsten: Franchising - The other kind of self-employment; Advantages and disadvantages of partnerships in franchising systems , Munich, 1997
  • Lower Saxony Ministry for Women, Labor and Social Affairs (Hrsg.): Soziale Betriebe in Niedersachsen- Development and effectiveness of the program in comparison to other instruments of labor market policy , Hanover, 1998
  • Schneck, Ottmar: Handbook of alternative forms of financing - occasions, private equity, participation certificates, ABS, leasing, factoring, employee participation, BAV, franchising, silent partnership, participatory loan, IPO , Weinheim, 2006
  • Skaupy, Walther (1995): Franchising - Handbook for Business and Legal Practice, 2., revised. Ed., Munich
  • Steiff, Julian (2004): Opportunism in Franchise Systems: A Contribution to the Management and Evaluation of Franchise Systems, 1st edition, Wiesbaden
  • Wachs, Philipp-Christian : Success model for Germany? - Foreign examples of social franchising , in: Stiftung & Sponsoring 04/07, pp. 36–37, 2007
  • Wendt, Wolf Rainer : Social Economics - Basics and Perspectives , 1st edition, Baden-Baden, 2002
  • Wendt, Wolf Rainer : Social economy - a system , 1st edition, Baden-Baden, 2003
  • Wellcome : Wellcome - Practical help for families after the birth , information brochure, Hamburg

Web sources

  • Egold, NW: Customer Orientation and Customer Satisfaction: Correlates of Personal and Organizational Customer Orientation , Diss., University of Frankfurt a. M., 2007, http://publikationen.ub.uni-frankfurt.de/volltexte/2007/4704/pdf/DISSERTATION_EGOLD.pdf , last accessed on: March 27, 2014
  • Evers, Adelbert: Social enterprise. A proposal to think differently about the future of public social services. , Contribution to the 31st Congress of the German Society for Sociology in Leipzig “Denationalization and Social Security”, online publication of the Heinrich Böll Foundation Bremen ( http://www.boell-bremen.de/daten/35340b9d7cf36d5bdd2a.doc ), last accessed on: March 27, 2014
  • Franchise-Blog.de: http://franchise-blog.de/social-franchise-systeme-kurz-vorgestell/ , 2010, last accessed on: March 27, 2014
  • Hoelscher, Philipp: License to help - social franchising as a successful model for foundations (source no longer available)
  • MCM: MCM News April 2008, (source no longer available)
  • Meuter, Julia: Social Franchising , http://www.berlin-institut.org/online- Handbuchdemografie/entwicklungspolitik/ social-franchising.html ?type=98, 2008, last accessed on: March 27, 2014
  • Tran, The Nguyen: Franchising as a sales concept for social institutions using the practical example of Wellcome (source no longer available)

Individual evidence

  1. ↑ Bundesverband Deutscher Stiftungen (Ed., 2008): Social Franchising - A method for the systematic reproduction of charitable projects , http://www.stiftungen.org/fileadmin/bvds/de/Projekte/Projekttransfer/Social_Franchise_Manual_Deutsch.pdf , as of: 24. October 2011
  2. ↑ ibid., 26
  3. ↑ see ibid.
  4. ^ Ditges, Florian (2001): Franchising - the partnership form with a system; a guide for initial orientation , Bonn.
  5. ↑ (cf. German Foundation for World Population (2001): Social Franchising - A Worthwhile Alternative for Development Co-operation. Documentation of the workshop on social franchising of the German Foundation for World Population in cooperation with Wellcome Trust, Hanover , 9)
  6. ↑ Bundesverband Deutscher Stiftungen (Ed., 2008): Social Franchising - A method for the systematic reproduction of charitable projects , http://www.stiftungen.org/fileadmin/bvds/de/Projekte/Projekttransfer/Social_Franchise_Manual_Deutsch.pdf , as of: 24. October 2011, p. 28
  7. ↑ ibid.
  8. ↑ see ibid.
  9. ↑ http://www.wellcome-online.de/was_wir_tun/hilfe_nach_der_geburt/zahlen/index.html , accessed on March 11, 2014