Franchising Your Business?

There are several important factors to consider before you franchise your business. The following questions can serve as a roadmap as you contemplate franchising your business. If your answers to most of the following questions are positive, your probability of franchising success increases dramatically and further consideration to this growth strategy is worth your time.

1. Is your business profitable at all levels? That is, will the franchisee as well as the Franchise Business make money? Will both parties share in the wealth?
2. Has your business been in operation long enough to effectively project its chances of future success?
3. Will the franchised business generate sufficient revenue and profits to attract the “ideal” franchisee candidates?
4. Will the initial investment requirements be commensurate with the projected returns and is it realistic to project that “ideal” franchisee candidates will have the required funds or have access to borrowings?
5. Do you have a desire to have and support a team? Do you care about making a difference and giving others opportunities?
6. Are you prepared to enter into long term agreements with individuals resulting in business relationships that will last for many years?
7. Are you eager to expand and capable of providing initial and ongoing training and support to franchisees?
8. Can your business be analyzed and fully documented for others to follow by using operation and procedure manuals?
9. Is your business simple enough that most people can learn how to operate it effectively?
10. Do the products and services being offered fill a defined consumer need? Are they acceptable for a large segment of the market? Is their demand sustainable or likely to decline as it would happen when they are part of a fad?
11. Does your business offer unique and/or different products and services that easily differentiate the business from its competitors?
12. Can your business concept be packaged and effectively communicated and sold to prospective franchisees?
13. Have you protected your business’s intellectual property through trademarks, trade names, and patents? Can this property be licensed as part of the intellectual property to prospective franchisees?
14. Do you have qualified managerial staff available to assume the responsibility of overseeing a franchise operation? If not, are you prepared to invest the financial resources necessary to recruit qualified managers?
15. Are you prepared to—and capable of—investing the necessary funds to create and maintain a successful franchise system? This includes creation of operation and procedure manuals, franchise agreements, and other legal documents; establishing franchisee-training programs’ and dedicating managerial and support staff to run the franchise system.

Predicting with certainty franchise success can be difficult, if not impossible. Every business owner is different and so are their businesses. Many successful businesses are not suitable to franchising, and not all businesses that franchise are successful. However, the advantages of franchising as opposed to alternative methods of distribution have proven favorable for many companies; and it could be so for your company as well. If you answered YES to most of the above questions and have a desire to expand your business, franchising is a good option to consider.

Give us a call, we can help you exploring this option further.