Franchisee-Franchisor Relationships - How Strong Partnerships Drive Innovation featuring James Sakalian
Franchising expanded in the United States at the turn of the 20th century, exploded in the 1950s and 60s, and has grown exponentially ever since. The innovation and development inherent in the franchise model, combined with the introduction of mass production capabilities, created new opportunities on the business landscape. Once retailers, manufacturers, restaurants, and the hospitality industry recognized the possibilities in commercial franchises to sell and distribute products at lower costs, there was no holding them back.?
Friendly’s Restaurants was one of the first full-service restaurant franchises. Operating since 1935, Friendly’s mission from the beginning has been to provide families with a dining experience that offers delicious American favorites, especially ice creams. As a brand with nearly 90 years of experience in franchising, Friendly’s cites the relationships with its franchise partners as the main contributor to its long-term success.
In all the best franchises, strong relationships between franchisees and franchisors create a foundation of trust and collaboration, leading to operational consistency, brand loyalty, and shared success. Positive relationships foster better alignment between both parties’ goals, increase franchisee engagement, and reduce the risk of conflicts, all of which are essential to scaling the brand, maintaining long-term growth, and encouraging opportunities for innovation.
The Role of Strong Partnerships in Business Innovation?
Innovation is what has continued to drive franchising forward and helped businesses evolve for decades. Innovation forces franchisors and franchisees to look at the state of the industry as well as the economy and understand their consumers on a deeper level. These insights help franchises adapt to market trends, discover new ways to challenge competition, and make technology advancements that will improve operational efficiencies to cater to consumer interests, improve product quality, and enhance customer service.
A mutual investment in a strong relationship can lead to collaborative innovation in franchising. Strong partnerships between a franchisor and franchisee open the doors to new opportunities and better ideas. The best relationships between these partners enhances operational consistency across locations and builds trust, ensuring the brand evolves with market trends and stays on top of consumer demands. When these relationships are successful, franchisee satisfaction and retention get a boost, turnover is reduced, and a network of experienced partners is created. A collaborative approach to problem-solving not only increases profitability for both franchisors and franchisees but also fosters brand loyalty and alignment, bringing everyone together to work toward shared, long-term goals.
Collaboration as the Foundation for Innovation?
As a franchisor, working collaboratively with franchise partners is key to fostering relationships in which innovation and creativity thrive. Franchisees can be successful in their roles only if they’re backed by leadership support and a system that works. Franchisors can better strengthen and support their franchisee relationships by:?
Real-Life Success Stories of Franchisee-Franchisor-Driven Innovation?
Founded on innovation, Friendly’s Restaurants was the brainchild of Prestley and Curtis Blake of Springfield, Massachusetts. As one of the first food service franchises in America, the restaurants were created to provide a place for families to enjoy a nice meal together. What started as a small ice cream shop later turned into a full-service diner-parlor experience with over 100 locations around the U.S. for guests to enjoy.?
For decades, Friendly’s has continued to evolve, introducing new menu items adding new ice cream desserts, breaking records and reaching new milestones thanks to franchisee input and collaboration. Most recently, owner James Sakalian has brought innovative ideas to Friendly’s, testing new products and introducing beer, wine and cocktails at his location.?
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Sakalian has been a Friendly’s Restaurant owner for more than 25 years, opening his first restaurant in Myrtle Beach, South Carolina, in 1998. Over the years, Sakalian has experienced trends, remodels, changes in ownership, highs and lows of the economy, and switches in leadership. He’s learned firsthand what it takes to operate a business and how to serve his community with a singular guiding light: Relationships are everything.?
"Being in business for 25 years, I've seen the challenges that many face in this industry. Having consistent support from BRIX and key employees who’ve been with us for over 20 years, who love taking care of people with respect and integrity, makes all the difference,” said Sakalian. “Our restaurant has adapted to changing trends while staying true to its core values, which is why I believe in its lasting success. Treating staff well is essential—it’s what keeps us strong. Though attitudes and beliefs have shifted over the years, our commitment to respect has remained unchanged."
It’s the relationship Sakalian fostered with BRIX leadership that afforded him the opportunity to be the first Friendly’s owner to introduce alcohol on his menus during breakfast and lunch. At Sakalian’s Friendly’s location, guests can now order mimosas, Bloody Marys, along with traditional breakfast favorites like shrimp and grits and Eggs Benedict. Sakalian operates in a global tourist destination, and the idea came to him after locals and tourists continued to request the new menu additions during their visits.?
Sakalian brought his market insights and trends to BRIX leadership, and together they began working on making his idea a reality. After a year of collaboration with finance, marketing, legal and innovation teams, Sakalian has begun testing the new menu options at his location. The items launched in early October, and while data is still new, feedback from the community has been positive.?
“Our whole company is focused on finding ways to increase sales, and a lot of owners, as well as corporate, are watching to see how our initiatives perform with the hope of potentially rolling them out across the market,” said Sakalian. “We have a great breakfast menu, but it’s essential to introduce items that are easy to replicate while maintaining quality. Adding new menu items and advertising is exciting, and I’m honored that we get to test them here first, which not only boosts our bottom line but also has the potential to benefit the entire company.”
Overcoming Challenges in Franchisee-Franchisor Partnerships?
Franchisee-franchisor relationships often face challenges when driving innovation, including resistance to change, as long-standing practices can limit openness to new ideas. Cost constraints also play a role, as franchisees may be hesitant to invest in unproven initiatives without clear returns. Additionally, compliance and consistency issues can arise, as innovations must align with brand standards to maintain a cohesive brand image across locations.
To overcome these challenges, franchisors can encourage pilot testing to validate new ideas on a smaller scale, minimizing risk for franchisees. Establishing clear guidelines helps ensure that innovations align with brand standards while allowing flexibility for experimentation. Offering financial support or risk-sharing incentives can also make franchisees more open to adopting unproven initiatives. Additionally, fostering a culture of experimentation by recognizing both successes and valuable lessons from failures promotes an environment in which franchisees feel supported in driving meaningful, brand-consistent innovation.
90 Years of Brand Innovation with Many More to Come
Franchising has been around for decades and continues to innovate and evolve every day. The best businesses continue to succeed because prioritizing relationships between franchisors and franchisees is foundational. Friendly’s values the work of its franchise partners and is grateful for their dedication, transparency, and collaboration to the brand. The business continues to grow, serving new communities and providing new spaces where memories are made, and creative ideas come to life—just as it has for the last 90 years.?
If you’re interested in learning more about franchising with Friendly’s, visit our franchise website here.
For more information about BRIX Holdings and the other BRIX brands, visit our website here.?