You built your business with dedication, hard work, learning – specially from mistakes to avoid – a business that you are proud of and are evaluating the next step to growth it. Is Franchising a good way to expand your successful business? Franchising is a great way to grow a business for some entrepreneurs but not for others.
“Franchising is a form of business by which the owner (franchisor) of a product, service or method obtains distribution through affiliated dealers (franchisees). The business model is based in a continuing relationship in which a franchisor provides a licensed privilege to the franchisee to do business and offers assistance in organizing, training, merchandising, marketing and managing in return for a monetary consideration”, according to Entrepreneur®.
Global Franchise consultants are experts in distribution channels and licensing systems. But, before deciding whether to go or not to franchising, write down a briefing of your business for your own evaluation.
- unique selling proposition
- success ratio in your industry
- credibility
- integrity and commitment
- public acceptance
- potential for national adaptability
- goods that are proprietary
- profitability
- organization
- financial control
- cash requirement
- monitoring system
- facts that exposed the business publicly
- Franchises offer franchisors quick business growth primarily funded by franchisees.
- Franchisors earn a certain percentage of each unit’s gross profit.
- A franchise system’s expanded network can combine marketing and advertising power, as well as the ability to capitalize on new opportunities.
- Hiring, unit operating expenses and lease arrangements for the new site are “typically” the franchisee’s responsibility.
- Franchisors incur the expense of legal and regulatory fees, which may be impractical when a company is suited only to limited expansion.
- Franchisors must invest considerable time and resources in the franchising process before realizing a profit.
- Franchisors must set standards for attracting qualified franchisees and systems for closely monitoring all units in their networks.
- Write a detailed business plan that includes a business history, current market analysis, company vision and financial projections.
- Consult with Global Franchise before registering a trademark, hiring attorney, developing a marketing plan or corporate id, hiring and advertising agency, writing manuals and training programs. Laws and regulations vary from country to country, states and industries.
- Register your trademark or service mark to protect against infringement.
- Consult with a qualified attorney with expertise in franchising and intellectual property.
- Complete legal documents in a thorough and timely manner.
- Develop a marketing and advertising strategy that establishes a uniform company look and customer experience.
- Write operating manuals and create a standardized training program.
- Establish initial and ongoing support for franchisees, including maintaining continuous involvement and communication.
- Develop a management team to help open new franchises and offer advice to franchisees about site selection.
