Keys to Successful Franchising:

5 Things to Do Before Franchising Your Business
Reflections of a Franchise Consultant

Stephen S. Raines
President, National Franchise Associates
Atlanta-Based Franchise Consultants

I am often asked to discuss what a business owner must do before “franchising” his or her business.

The following is a list of things to do prior to franchising your business:

  1. When you evaluate franchising your business, ask yourself if it is the kind of business that other people may want to own and operate? Can you teach someone else how to run the business within a reasonable time period? Franchising your business requires having a concept that is duplicable and not so unique that only a few people can qualify to become franchise owners.
  2. When you consider franchising your business, think about the Initial Investment required. How much did it cost you to open your business? When you are franchising your business, do you expect the initial investment for the franchise owner to be similar? If not, what do you think the range will be for the franchise investment?
  3. The profitability of the business is an important part of the equation when considering franchising your business. Will a well-run franchise generate enough earnings to motivate someone to invest in your franchise?
  4. When considering franchising your business, what type of income can you expect to derive from various potential sources, such as the initial franchise fee, the weekly or monthly royalties, profits from the sale of equipment or inventory to franchise owners and other possible areas? Also, what expenses can you anticipate when franchising your business on both a start-up and on-going basis?
  5. Streamlining your business operation is a common exercise when franchising your business. You can fine tune your business system in order to make your business more franchise-able.
    I hope that the points noted above will help you when you are considering franchising your business.