//Should I Franchise My Business?

Should I Franchise My Business?

In my over three decades as a franchise consultant, I am often asked “Should I franchise my business?” What makes a business “franchiseable?”

There are a number of issues that could help make a business a good candidate for expansion through franchising.  Topics like ease of duplication, personnel, territory considerations, etc, are all points for discussion with franchise consultants.

The Checklist To Franchise My Business

Some or all of the following questions may apply when you are making this decision:

  • If I franchise my business, can the franchisee expect to make a reasonable return on his or her investment in the franchise?
  • How much direct competition will my franchisees face in the marketplace?
  • If I franchise my business, can my concept be duplicated?
  • If I franchise my business, how much direct competition exists in terms of selling franchises?
  • Can I offer my franchisees competitive advantages?
  • Can I train the franchisees and their employees to operate the business in a reasonable amount of time?
  • If I franchise my business, is there growth potential for my industry?
  • Do I have enough trained personnel to help me implement my initial franchise strategy?
  • If I franchise my business, have I been in operation long enough to prove my concept is viable?
  • If I franchise my business, will my franchisees be required to have any special licenses or advanced degrees to operate the business?
  • How challenging will it be for franchisees to find affordable franchise sites?
  • How large a territory and what type of territory are necessary to support one of my franchises?
  • Will my franchisees be dependent upon one or two vendors? If so, does this reliance make my franchise vulnerable?
  • How complicated will it be for a franchisee to open a new location?
  • What is the long-term viability of my concept?
  • What is the likelihood that I can add additional products or services, making my franchisees even more profitable?

Is Franchising the Ideal Form of Business Expansion?

Well, yes and no.  Business expansion for many business owners often means one ideal direction, franchising.  Investment is a big part of this decision for future locations because franchisees are responsible for the investment involved with opening locations generally.  This means that franchisors can grow faster than they might by funding expansion all on their own.

With that said, all businesses are not ideal for the franchise model.  Therefore, a comprehensive, upfront analysis of your business with franchise consultants is recommended.  You may consider the following talking points during this initial session.

First off, is your business model proven?  Most businesses will explore expanding once they have a gut feel that business is good and could be just as solid in other locations.  However, there are practical considerations such as operating prototype that can ultimately be replicated predictably.

Also, can you sell your franchise concept?  Is the business ‘credible’ for instance, is it ‘unique’ enough to attract interest?  Also, can you clone the business in such a way that the franchisee doesn’t necessarily have to work the 80 hour plus weeks that the founder may have for initial success in the founding location.

The franchisee is going to want a solid return on investment after royalty considerations.  Not only is the franchisee looking for a return on the time spent operating the business, but in the money spent on establishing the location.

Will you, as a franchisor, provide value to your team of franchisees?  A large part of that successfully growing team is the ability to maintain multiple relationships with state-of-the-art training programs and frequent franchisee interaction.

Do YOU have capital to franchise?  Franchising is certainly not a low cost means of growing.  There are legal documents, training programs, operating manuals, marketing materials and of course, a marketing budget to generate leads.

National Franchise Associates has the experience to help businesses franchise.  Just watch and listen to some of our client case studies and video testimonials.  We can HELP YOU and it doesn’t cost anything to call and talk to us! 

So, if you are still asking the “should I franchise my business” question over and over with no clear direction, give us a call at (706) 356-5637, or contact us through our online form.  We look forward to helping you take your business to the next level and beyond.

 

By |2018-02-04T08:11:11+00:00December 11th, 2016|Franchise Planning|