From McDonald’s to Everest

Sotiris Yanakakis will be in Bulgaria on 26th and 27t h of November to take part in the “Franchising Business” conference, part of the Franchising Expo 2010 in the National Palace of Culture.

How did you decide to specialize in franchising law?
My decision to specialize in franchising law was influenced by my involvement with the McDonald’s franchise in Greece in 1993. At the time franchising was a very new concept in Greece.

What are the most common problems in the franchisor-franchisee relationship?
The franchisor must be sure that the person with whom he collaborates is suitable for the particular type of franchise or indeed has the capacity to accept the responsibility of owning his own business. This is very important for the franchisor because the franchisor entrusts his reputation, his trade name, his trademark, his goodwill, his business in general to the franchisee. The franchisee must be responsible and collaborate, or enhance the reputation and the trade name of the franchisor while protecting them from encroachment.
Franchisors specifically face problems of collaboration, communication, control and supervision with the franchisee. These are problems with which the franchisor would be faced while running his own business.

What are the latest projects that are you working on in the Greece Franchise Association?
The presence of the Greek Franchise Association in franchising conferences around the world is very important for the support of the development of franchising in Greece and in the region as well as the adoption and the public proclamation of the principles and correct practice of ethical franchising.
The Greek Franchise Association in collaboration with other Universities, Chambers of Commerce holds seminars for the franchisors, the franchisees, for executives of the franchisors and the franchisees, who receive a certificate of specialty for the specific sector, after completing an approximately 70 up to 120 hours training.
Moreover, it is establishing mediation and bilateral agreements with other Franchise Associations for promoting franchising, and it is participating in the formation of the Mediterranean Franchise Federation with its registered office in Athens.

How the franchising organizations – associations, federations and clubs - can help the franchisors and the franchisees?
Such organizations can help both franchisors and franchisees and franchising in general. For example the Greek Franchise Association substantially aims at securing and enhancing trust among the Franchisors, the Franchisees and the consumers. The Greek Franchise Association publishes the Association’s magazine and it is also in the process of developing an electronic library where legal decisions, tax cases and other matters relating to franchising will be available to its members.
The Greek Franchise Association has established the Association’s Code of Ethics which is based on the European Franchise Federation’s Code of Ethics. This Code makes a significant contribution in building this interplay by assisting all parties involved to be fully acquainted with the rules of ‘business’ via franchising.  Every member receives every year a certificate stating that the member abides by the Association’s Code of Ethics, while it possesses a differentiated value against a non member.
Moreover, the Greek Franchise Association collaborates with business, political and social bodies, to make contacts with the Chairmen of the corresponding bodies in order to gain access to their members and on the other hand to be able to communicate with franchise entrepreneurship, and on the other hand to promote our business activities.

Which are the most successful franchises in Greece and what makes them different?
The most successful franchises in Greece are Everest, Gregory’s and Goody’s which are all in the food sector. These franchises are successful because of the good food and value for money they provide. They are present in open-access, restricted-access and high turnover marketplaces which are factors that increase their popularity.

What are the trends in the development of the franchising systems in the region?
Due to the economic crisis, the rise of unemployment and layoffs, more and more people are looking into franchising as an option.
Moreover, there are a lot of opportunities in the Balkans and many companies are expanding and setting up franchisees in these countries through master franchise or joint venture relationships.

What is your message to the participants in the Franchising Business Conference?
For prospective franchisees I would state that Franchising is an excellent way to be in business «for yourself», but not «by yourself, because the franchisor is your «right hand». The franchisor provides a method of doing business that has been tested over time in the market place and it would be win-win for both parties. The franchisor provides its expertise, experience, continuous advertising and market support.

For prospective or existing franchisors I would state that Franchising is a method used by the franchisor to expand their business more quickly than would otherwise be the case. More and more international companies are currently realizing this and are trying to assess whether franchising can be used as a vehicle for their international expansion. The reasons for the growth of this form of retailing lie in the numerous advantages franchising has to offer to both franchisor and franchisee.

Sotiris Yanakakis is a member of the Maritime Law Association of Greece, the Hellenic Association for European Law, Harvard Law Association of Europe, General Director and Legal Advisor of the Franchise Association of Greece. He is in charge of the vice-secretariat for the Legal Matters of the World Franchise Counsel, and of the newly formed Mediterranean Franchise Federation. He is also member of the legal committee of The European Franchise Federation.