Is Franchising Right For Your Business?
Franchising a business is a great way to expand and get your products to the market quickly. It is possible to achieve strong growth using the franchise model.
Franchising though is not suitable for every business. Analyse your business model and ask yourself the following questions:
Can my business model be taught easily to people with no prior business experience?
How easy would it be and how much would it cost to recruit new franchisees?
What kind of person would make the ideal franchisee?
Who would provide the training and ongoing support?
What are the unique selling points of my business?
If you can answer all these questions then it is time to seek expert professional advice. You will need help in creating a franchise agreement, training programmes, support systems and marketing methods.
A franchise lawyer will be able to assist you with creating a professional franchise agreement which will end up being the cornerstone of your business.
You will have to decide whether you can do the training in house or outsource it completely. There are many training providers who can do an exceptional job of training your franchisees and I strongly advice you to examine them carefully. These providers will not only assist with the initial training but can also provide ongoing support.
A marketing expert preferably from the franchise industry can give you ideas on how to market your franchise and recruit the best people. It is essential that you do not offer your franchise to everybody who has money. They must also possess the skills required to manage your business successfully.
The services of an accountant will then be required to present your franchise to the banks that specialise in helping franchisees to buy a franchise. Funding agreements must be in place before you start recruiting. Banks are very helpful to have on your side when you start recruiting as most of your franchisees will not have the full funds required to buy your franchise. The franchisees will also require operating capital until their new business can sustain their lifestyle.
To attract the right kind of franchisee you need to present your business opportunity in a professional manner. There are hundreds of franchises on offer and many of them are very good opportunities. The presentation is almost as important as the concept when it comes to recruitment!
Once you have managed to attract the right franchisee it is imperative that they are taken skilfully through the training process. The training must be well thought out and thorough. Many of your recruits will not be coming from either a sales or business background. They will have to be taught basic business and marketing skills prior to learning how to manage your business model.
If premises are required then the choice of location must not be left to the franchisee but rather it should be a joint decision. Even this can be outsourced to professional companies, who specialise in finding the right locations, negotiating favourable terms and dealing with the landlord.
Using the franchising route to expand into new markets can be fraught with dangers but if correctly handled it can lead to successful growth of your business model and ultimately to the profitability of your business.