6 Best Reasons To Franchise Your Business

Are you a business owner looking for business growth opportunities? Have you thought about franchising but don't really know the Whats and Hows? Or rather, are you wondering why you should franchise your business in the first place?

If you answered “yes” to the questions above, you’re in the right place!

Franchising a business can seem like a daunting task, especially if you’re just dipping your toes in these waters. But what is franchising?

Franchising, simply put, is the act of selling the rights to another party for opening a new unit of your business (a shop, restaurant, spa, realty service provider, dog grooming service etc.). In turn, that party follows your already established business model and pays you a percentage of the gross sales as royalty.

First, Why Should You Franchise My Business?

If you want to expand your business to new areas, franchising will provide you with an opportunity to do just that using other people’s money and resources. There’s obviously a lot more to the benefits franchising your business brings. Let’s take a look at some of the major ones.

Now, let’s explore the 6 best reasons to franchise your business you should consider;

  1. Motivated Partners
  2. Increased Revenue
  3. Rapid Business Growth
  4. Boosted Business Value
  5. Better Market Coverage
  6. Higher Success-to-Risk Ratio

1. Motivated Partners

When you franchise, you get a partner that has invested a considerable amount of money into getting the rights to your brand as well as physically setting up the franchise. They are also ready to invest their time and effort into making the franchise a success. This gets them to work hard and take ownership of the profits and the losses and, in the process make sure you benefit as well.

2. Increased Revenue

As a franchisor, you will be tapping into an additional source of income. Each new franchise will add to your income by means of franchise fees, royalties, and markups on supplies. Additionally, you can negotiate vendor rebates when your franchisees purchase from the same vendors you do. Purchasing additional quantities from the same vendors also allows you to negotiate better prices, further increasing your net revenue.

3. Rapid Business Growth

This point extends from the one about increased revenue above. The revenue generated with every additional franchise - with little to no capital investment on your part - can be invested in your business’s progressive growth and development.

You can also grant rights to the franchisee(s) to own multiple franchises simultaneously.

4. Boosted Business Value

Each of your franchises is a symbol of your product or brand’s quality and authenticity. The more franchises there are, the more visibility they will get. This will generate new business in the form of new customers which will get new potential franchisees to reach out to you.

This will result in more franchises and the snowball effect will just keep on bringing on greater success and potentially more profits.

5. Better Market Coverage

Franchising provides the perfect opportunity for you to increase your market penetration. It makes this possible by allowing you to reach new locations and markets, effectively and rapidly. This in turn allows you to access larger demographics, effectively increasing the value your business generates. Additionally, there’s a chance that the franchisee themselves are quite well-established in their community even before they take up one of your franchises. This further lends credibility to the new franchise and thus your business.

6. Higher Success-to-Risk Ratio 

You shift a major portion of the risks associated with a new franchise over to the franchisee along with the capital cost that they are already bearing. Additionally, the franchisee also takes responsibility for the legal side of things for their franchise such as signing leases and employee contracts.

Research and experience have also shown that the chances of success associated with a new franchise of an existing brand are much higher than that of new, solo businesses.


As a franchisor, you have access to an additional revenue stream each time you engage in the establishment of a new franchise. Since your franchisees are investing their own capital and time, they will be working that much harder to ensure that the new outlet is a success. Increased revenue, greater business growth, and better market penetration then come as a natural progression of events.

Having the right franchise development team at your disposal can make this entire process much more streamlined for you. This is where FMS comes into the picture! We have an expert team of franchising and marketing specialists that will work with you and address your franchising needs from A to Z.

Get in touch to start your franchise today!

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