I’ve noticed some franchisors guarantee a certain amount of work for their franchisees. How is this possible?

Some franchisors – but not many – do indeed guarantee a certain level of work.  You see this obligation especially in cleaning franchises.  The danger is that the work that is offered is offered at rates which are unprofitable and once the work has been offered then if the franchisee either does not accept it because the franchisee does not believe it can make money from it or enters into the contract with the customer and then terminates because it cannot make money or the contract is terminated by a customer, the franchisor has complied with its obligation to offer work.  This does mean that prospective franchisees do need to exercise very considerable caution in entering into franchises where guaranteed work is included.

That is not to say that all franchisors who do offer guaranteed work are “dodgy” – although the British Franchise Association has, for some time, been concerned about this practice and has issued a technical bulletin in respect of it.  If you are contemplating entering into such a franchise you need to raise the question of profitability with the franchisor and there should be guarantees from the franchisor that any work offered could be undertaken profitably.  You should also talk to the franchisor’s other franchisees – and not simply the ones that the franchisor wants you to talk to – to ensure that they can confirm that the work that they had offered to them was, indeed, profitable.