Many successful entrepreneurs often think about expanding their business at some point. And as individuals we are naturally inclined to grow and evolve, however, growing your business requires capital, time, and immaculate management skills. So those who lack the sufficient resources for a successful business can always resort to the winning concept of franchising.
Why Franchise?
You may ask yourself why franchise a business when I want to expand my operation? It is for the simple fact that in franchising, the capital needed to set-up the new business expansion is provided by the franchisee. Therefore, a business is allowed to grow much faster. As exciting as it may sound, there are still some things you need to keep in mind when deciding to franchise. Most important of all, you have to support staffing demands to keep quality and standards consistent across your franchises. Also unlike when owning your business, hiring and firing managers is no longer up to you!
Is My Business “Franchisable”?
Now, before you jump the gun and decide that franchising is for you, remember that you also have to understand whether or not your business is “franchisable”; which means that your company should be viewed by others as a business opportunity. This in mind, your business should be a concept that has some spark in it and is attention-grabbing such as a new technology or a fast food chain. In short, it has to have potential that is appreciated by the prospective franchisee.
Quality Comes First!
Most individuals choose franchises over other businesses because they are comfortable knowing that the quality levels of the product/service is the same as what they have been accustomed to. Therefore, you must maintain the same quality and service provided by your principal business.
A lot of well-known franchises register for trademarks, which conveys their exceptional concept. So when creating a trademark for your franchise, make sure it is unique and displays a distinctive message about your product or service that allows consumers to relate to that name e.g. fast service, healthiest choice, family choice…etc.
How It Is Done
Once you are keen on franchising your business, you need to consider how you would like to choose your franchisees. Most franchisers have a process when doing so.
You may choose to have an initial application to obtain general information about the prospect franchisee. It is essential that they have certain qualities that will make it possible for them to maintain the same quality of service.
You can then hold an interview once you have narrowed down the choices so you can guarantee finding the best representation of who will be managing a business under your brand name.
It is also a good idea to take into account the fees you will charge a franchisee, whether it is a starting fee, a yearly fee, or whether you would like to enforce sales targets. In addition, you will need some legal advice when drafting a contract that details all what is required from the franchisee and what will be needed from you as the franchiser. Contracts will also have to specify what aspects of the business need to stay the same and which areas you will consent to to being altered or modified to best suit the environment of the market in the new location.
In conclusion, as an entrepreneur, it is always a good idea to bear in mind the possibility of franchising your name as you will be able to expand faster and reach further geographic locations spreading your brand even beyond what you originally imagined.