Want to Turn Your Business into a Franchise? Here’s What You Need to Know First…
Most businesses are built with growth in mind no matter the sector. When done right, growth will ultimately make a business more profitable and increase its value to potential buyers and partners. But all growth isn’t good growth and too many businesses become victims of their own success. Depending on your line of business, franchising can be a great way to expand fast without having to deal with all the additional pressure and administrative bloat. In this article, we’re going to give you a few things you should know before you franchise your business.
Take a Look at Your Business Structure
Not all businesses are fit to be franchises. The first thing you have to assess is whether your business is actually a success and shows potential for growth. Nobody is going to hop on a sinking ship or buy into a franchise unless you can demonstrate that they can build a financially rewarding business for themselves. One idea could be to create a franchise pilot to demonstrate to potential franchisees that your business model is indeed viable.
You also have to make a case for franchisees to buy into your business instead of just copying your model and setting up their own version. A franchisor has to have a valuable enough brand for franchisees to actually buy into their concept and decide to go the franchise route instead. You also have to offer additional perks. Some franchise models are very simple but offer enough support and material for franchisees to hit the floor running and shortcut the creative investment and time it takes to start the same kind of business from scratch.
You should also consider if your franchise relies on highly specialized skills. The more specialized the skillset, the trickier your business will be to franchise.
Before you start, you should make sure that you obtain good advice, whether it’s the legal or logistical aspects of building a franchise system. You will want to find a reliable law firm like Harper James Solicitors (hjsolicitors.co.uk) as they will be able to help you with issues like intellectual property protection for instance. They may also help you with things like drafting franchise agreements as well. You could also work with a franchise consultant to guide you through the franchising process. They might help with things like pricing and creating comprehensive operations manuals for your franchisees among other things.
Be Picky with Your Franchisees
This might seem obvious at first glance, but many businesses are so excited about getting a few franchisees that they might not be as strict as they should be when it comes to vetting candidates. However, being too eager will only lead to more issues down the line.
What you want is motivated individuals who are genuinely excited about your business model and who actually want to start their own business. You should also look for franchisees that have a strong core of ethics, since they will have to obey a certain set of rules. Too many franchises have been sunk by rogue franchisees who didn’t follow procedures. You don’t want to work with franchisees who will end up damaging your brand and make it not only unprofitable but who hinder the recruiting process as well.
Make sure that you consider which application process would work the best for your business. After all, you are actually making these people your partners, so both parties have to be on the same page and a great fit for each other.
Focus on Good Support and Training
Some franchisors are notorious for leaving their franchisees out to dry and neglecting support. But at the end of the day, any issues that affect your franchisees will end up affecting you as well. Selling a franchise is just the first step; remember, these are partners and they do not become fully autonomous once they become franchisees. You have to do everything in your power to make sure that they succeed since your own success depends on it.
You have to make sure that your support is top notch and your training is comprehensive. You also have to be able to understand the key performance indicators in your business and provide assistance to franchisees who are struggling in certain areas. New franchisees will need your assistance when they’re getting started, so it’s your responsibility to give them the support they deserve if you want them to grow. Not only that, but the amount of support you provide will also reflect well when it comes to recruiting new franchisees.
Franchising, when done properly, can be a great way to scale your business. However, you shouldn’t assume that it’s a quick and easy route to growth so make sure you are aware of the many challenges that come with it.
November 16th, 2018
November 13th, 2018
November 13th, 2018
November 12th, 2018
November 8th, 2018