Many franchised businesses now use the internet to communicate with the franchisor. This communication is mainly by way of an Intranet which is a private computer network. This can be done via the internet or via cables interconnecting the franchise network and serve to enhance the whole franchise network if done correctly.

The franchisees can place orders online and check delivery dates. Some of the largest fast food franchises operate "just in time" daily deliveries to their franchise network. This has really enhanced the process and meant that the franchisee can afford to carry lower stock at his premises and dedicate more space to marketing the products.

The more advanced systems even allow one franchisee to order goods from another franchisee if the franchisor is out of stock!

The tills can now be connected to the franchisors network and all sales relayed instantly to the franchisor. This means that in some cases most of the ordering functions can be removed entirely from the franchisee!

For the franchisor this is tremendous and means that they no longer need to rely on the franchisees keeping adequate stock. The franchisees benefits because their work load is reduced even further and allows them to spend even more time on marketing and customer relations.

The franchisee can now make online payments both to the franchisor and other suppliers without the need for cheque books, envelopes and postage. Online payment solutions have many advantages over the traditional method. They can help improve cash flow and reduce the risk of fraud.

Some advanced systems now allow view only access to their accountants and make their job of record keeping and analysis very easy. The accountant is able to see every transaction in real time and no longer has to rely on the franchisee to provide him data.

The franchisee can download the latest brochures, watch the latest video advertisement and even help the franchisor by giving feedback on how their marketing material could be improved further. They can also keep their operators manual updated regularly.

Prior to high speed internet access the franchisees were usually running the business on their own computer. This then meant that they were in charge of backups, firewalls and security. This meant that the franchisee had to be trained in the operation and maintenance of their computers.

Franchisors use the web for marketing their franchises and building a brand image. They can also help their franchisee network by generating leads and providing them to their franchisees in real time. People are now just as likely to search for a franchise or business opportunity on the internet as they are to buy franchise magazines and attend franchise exhibitions.

The dangers of using the internet (or intranet) are many. If the main server of the franchisors crashes and they do not have adequate back up facilities and use of other servers, the whole franchisee network could be affected.

Can you imagine how a franchise network of over two hundred franchisees could be affected if the franchisors servers were attacked by an internet worm that corrupted all the data?

Not all franchise businesses benefit from working of central servers. The main criterion in evaluating if setting up an intranet would benefit your franchise network is the amount of data that is handled by each franchisee.

If the amount of data handled is low and there is little need for the franchisees to communicate daily with the franchisor and the other franchisees then the ideal solution is for them to operate a local computer system.