Client: Texaco

Background
As the retail petroleum industry became increasingly competitive, it was essential for retailers to develop other revenue streams to maintain profitability. At the same time, there was an explosion of available co-branding franchise choices, especially in the fast food sector. This presented the retailers with both great profit opportunities, and potential risks if the decision to enter into a co-branding venture was made without a solid understanding of the co-branding business.

Objective
To create a co-branding assistance program that would:

• Explain the co-branding concept and its evolution;
• Outline assistance available to the retailers from Texaco;
• Provide site evaluation and analysis tools to assist the retailers in making the right decision on the co-brand partner;
• Summarize information on available co-brand partners; and serve as an information guide highlighting issues pertinent to co-brand franchise perations, especially fast food service.

Program Implementation
We created a comprehensive co-branding assistance and information guide which included the following topics:

• Co-branding opportunity: concept, evolution, potential rewards and pitfalls, products and services available
for franchising;
• Co-branding assistance program: available site evaluation and analysis tools, co-brand application submittal assistance, pre-negotiated contracts and reduced franchised fees, ongoing review of
additional co-brand partners, complementary programs from Texaco (e.g., facility development financing, leasing);

• Site evaluation and analysis tools: fast food propensity report, site review scorecard, co-brand franchise comparison worksheet, checklists of decision factors to consider;
• Available co-brand partners: franchise and royalty fees, space and investment requirements, customer profile, average revenue and profit margin;
• Co-brand application form, sample correspondence, typical application process timelines; and
• Information guide: signage and floor plans, fast food service fundamentals, food spoilage/theft/portion control, labor management and scheduling, health,
hygiene and safety, foodborne illness prevalence and control measures, advertising and promotion, customer service, security.

After the release and proven success of this co-branding assistance and information guide, Texaco International commissioned us to create a similar guide for use by its subsidiaries. Since Texaco International had an advisory role and no direct operational responsibilities, the international version would need to include an additional component covering information that the local management in each country could use to establish its own co-branding assistance program. Applicable topics in the U. S. version were revised for international use and the following topics were added:

• Local co-brand partner selection guidelines and tips, that can be used by the local management in each country to identify and evaluate local co-brand partners, in addition to the global co-brand partners available;
• Factors that drive co-brand success and examples of successful co-brand alliances; and
• Co-brand franchise pro forma analysis model and instructions.

Return to top of page