4 Great Reasons Why Franchise Model Can Work for You

As a business owner, you likely spend plenty of time thinking and dreaming of new ways to innovate, expand, grow, or franchise your business. If you are restless and eager for new opportunities, new ways to reach customers, and new ways to adapt to your changing industries, you may want to consider changing the whole structure.

Enter the Franchise Model

When you franchise your business, you create an easy-to-replicate business model that has proven successful, allowing you to scale quickly and maximize profits. The most successful franchises are those that can reach that same level of success in multiple locations and markets. It leads to exponential growth and more freedom for Franchisors that establish the framework for scalable operations and management.

The franchise model has proven successful across a wide range of industries, as it provides a proven process for many businesses to follow. Here are 4 great reasons why the franchise model may be the perfect way for you to expand your business.

Reason 1: You Create Brand Loyalty

When you franchise your already-successful business, you introduce your brand into new markets. Consumer behaviour indicates that people gravitate towards stable, trustworthy brands and established reputations. When you franchise your business, you gain a wider presence and target multiple audiences, which provides more exposure and opportunity for the consumer to get to know you.

Brand awareness creates loyalty and trust. It keeps people coming back and also entices new customers to feel comfortable giving your business a try. Once you establish that trust, you can create long-lasting relationships in the communities you serve.

Reason 2: You Take on Limited Risks and Liability 

You’ve likely spent countless hours and tireless nights working to grow your business from top to bottom. You pour your heart, soul, and money into your venture. When you franchise your business, you can remove some of the risks from the expansion process. 

Franchisors rely on investments from franchisees interested in becoming a part of the team. You begin to rely on the capital from these individuals, which removes risk and liability from the growth process. 

Instead of fronting your own capital, you can instead invest your time in honing your business model and providing the best training and support possible so your franchisees can walk with you down the path towards success. This paves the way for scalable growth with much less risk coming out of your own pocket.

Reason 3: You Can Accelerate Your Growth

If you believe that your business can be successfully replicated and introduced to new markets, franchising may just be the perfect model to expand. Not only does this allow you to open multiple stores simultaneously without concern about the day-to-day operations, but it gives you more revenue streams to reach higher profitability. 

In fact, the American franchise market is expected to grow at a rate of 3.5 per cent this year alone. By focusing on replicable practices, you can accelerate your growth and exponentially increase your earning potential.

When you franchise your business, you initially need to dedicate time to the creation of resources useful for your franchisees. Creating the infrastructure to recruit, train, and support means that franchisees are able to scale and grow much faster. 

Reason 4: You Gain More Freedom

Many business owners gravitate towards the franchise model so they can let go of some of the control over daily operations and focus on the larger picture. Instead of working inside the business every day, they can enjoy working on creating a business model that others can run. 

Franchisees manage their own employees, allowing the franchisor to conciliate their employees and streamline the corporate management process. You can trust that the structure of all day-to-day operations can be handled confidently by your franchisees. By creating a model that is proven successful and an easy-to-replicate operational strategy, you hand franchisees the golden ticket to success with your business. 

Conclusion

Growing your business may present challenges and hurdles to overcome, but when you use the franchise model, the framework is laid out for you. The success of the franchise industry has remained steadfast throughout the years, and it continues to be a beneficial model for business expansion.

If you are ready to franchise your business, trust our franchise experts to help you with each step of the journey, contact us today.

Build Wealth Through Franchising With an Emerging Brand

Franchising is a great way to own your own business by partnering with an existing company. However, hitching your wagon to a budding successful company can be a potentially smart way to create future wealth. Investing and franchising with an emerging brand may just be one of the most important aspects of building your bank from franchising. 

No matter what concept you choose, the chance of financial success can be enhanced by aligning with an advancing brand. Every major brand today started as a single store. Imagine owning a Five Guys location from the very beginning. If you’re able to get in on the action earlier then the returns can be stronger! Just take a look at the numbers. 

Sure, there might be risks associated with franchising with an emerging brand over a more established business, but if you ask us, the rewards far outweigh them! They may be less expensive to join, with much lower fees and better real estate that can be secured in new territories. 

Becoming a multi-unit owner is also the ideal end goal. If you want to build wealth as a franchisee, taking your returns and reinvesting them back into the same concept in order to open and own more locations may benefit wealth creation. 

If you are able to identify potential powerhouse businesses while they are still growing, you can get in on the ground floor of a seriously profitable franchise

While it’s impossible to guarantee which brands are going to take off and become successful sensations all around the world, we can help you spot a brand that’s on the rise with just these few essential questions. 

1. Who is Behind the Brand?

You can tell a lot about the future of a business by taking a look at the owner themselves. A committed leader often reflects a strong determination to be the very best in the market. If you can make sure that they are really passionate about their product, then you can guess that they will go further. A boss always needs to be all in on their business, it takes serious dedication to succeed. Find a franchise where you know you can count on the enthusiasm of the person in charge! 

2. How Fast is the ROI Expected to Be? 

When you franchise with an emerging brand, a key consideration, among many others, is often getting your money back as quickly as possible. A fast ROI can always indicate that it’s a good brand to bet on. It may seem simple, but the sooner you’re able to turn a profit, the better. This allows you to reinvest and become a multi-unit owner. This is the optimal way to build wealth and help grow the brand you’re benefiting from at the same time. 

3. Are They the Real Deal?

If there’s one thing today’s market has made clear, it’s that consumers prefer to pick a brand that they can trust. Buyers want a genuine experience, and they care about the message behind all the marketing. Power to ‘em! You can spot an emerging brand easier by looking at the identity behind the business and even why it was started. Authenticity goes a long way in any market sector. 

4. Does It Have Strong Economic Numbers? 

The numbers never lie. You want to partner with a concept that has already seen some impressive returns. The value of the existing locations should be evident and backed by strong economic units regardless of the sector it’s in. This is such an important indicator to examine when trying to find an up-and-coming business to franchise with. 

5. Is It a Trending Market?

It’s not just the brand that should be emerging, but the market itself as well. When we say trending we don’t mean some passing phase either. Find a sector that has been steadily growing over the course of a few years. See if the demand is there for the product and if it’s likely to increase based on the surrounding culture. You’re searching for a long-term trajectory of scalable growth here. 

Conclusion

The bottom line here is, to make sure to pick a winner! The United States is home to the largest franchise industry in the world. It’s no wonder why so many business-savvy self-starters are flocking to these partnership opportunities. The simple business model and proven framework of a franchise can mean you’re looking at a strong ROI. 

Many are searching for the exact right brand to be a part of and eventually achieve financial freedom. Considering the potential of any particular brand for scalable growth can be the ultimate determining factor in being able to build wealth.

Remember to consider these few important factors when asking about any potential franchise partners. They will help you to see if there is really the potential for the brand to grow and then you can get in on the ground floor. Find out who is behind the brand, how quickly can you expect the ROI, if the brand is authentic, if it boasts steady numbers, and if the market sector is trending up. 

While becoming a franchisee is certainly an easier way to make your riches than starting a brand from scratch, you still need to know exactly what to look for! Finding a way to franchise with an emerging brand can help investors potentially cultivate a lucrative standing within any industry. 

Learn more about how to find out if franchising is the right fit for your financial future by contacting our team of franchising experts today. 

Grow Your Franchise With These 7 Expert Tips

Franchising your business offers many benefits, and the opportunity for rapid growth is one of the front runners. With the ability to scale and expand your business quickly without the need for control over every detail, you can franchise your business and grow into a successful powerhouse. As you expand your business into multiple communities, you recruit, educate, and trust franchisees to become a large part of your expansion journey. 

The franchise model provides the framework to grow your business, as it details an almost formulaic, but flexible structure for expansion. As you adapt your business to the franchise model, you want to follow these tips from our expert franchise consultants to create a truly successful, valuable experience for your customers, clients, and franchisees. 

  1. Establish a Clear Business Model
  2. Create Quality Resources
  3. Focus on Education
  4. Listen to Your Franchisees
  5. Create an Alluring, Valuable Opportunity
  6. Stay Consistent with Your Brand
  7. Work with Expert Franchise Consultants

1. Establish a Clear Business Model 

First things first, you need a clear vision with a proven business model. Your business model will frame the way franchisees will tackle all aspects of their business, from operations to management. Before you franchise your business, you should already be successful. Once you choose to franchise, you need to adapt your already-proven business practices into a scalable, easy-to-replicate structure that anyone can follow. 

Consider ways to innovate your industry and carve a reputable and easily memorable niche for your business as it grows. Hone in on what you do best to offer value to both your franchisees and customers.

2. Create Quality Resources

Setting your franchisees on a path toward success is critical to your overall success as a franchisor. Take the time to consider important resources that you need to train and educate your recruits and their employees. As a business owner ready to franchise, you already know the ins and outs of your business, but it is up to you to pass on this knowledge to allow others to follow you down that path. 

Creating resources is an integral part of the collaborative process between franchisees and franchisors, so it is important to work, and possibly rework, these resources to motivate and inform others. Consider creating documents to help standardize the process as your business grows to multiple locations, such as:

When you create resources, you give answers to many of the questions that franchisees may have as they go to open their own locations. Not only will this give them insight into your solutions, but it will also be a more efficient use of your time.

3. Focus on Education 

Your franchise opportunity is appealing because it removes some of the risk of business ownership with an established, proven model. Franchisees jump on board because they are excited to learn how to take what you have started and create their own successes from it. Because of this value, training should be a primary focus when it comes to your franchisees. 

Prepare franchisees by offering valuable, comprehensive training programs, holding ongoing workshops to keep everyone updated, and performing routine check-ins to ensure they are on the right track. When you franchise your business, you may give up some control over each detail of your business, but you take on a new, instructional role.

4: Listen to Your Franchisees

When you take on the role of a franchisor, you may take a backseat to deal with customers in order to meet the new demands your franchisees require. This is a natural part of the process, as you are making the transition from working in the business to working on the business. Listening to your franchisees gives you a chance to provide them with the tools and resources they need to then deliver and maintain the original customer focus. Take the time to understand their needs so that you can all succeed together.

5. Create an Alluring, Valuable Opportunity

To generate interest in your franchise, you need to create a business that offers value to your investors. When you ask others to invest their hard-earned money into your business, you need to take into account how you can support them and provide unique value to their lives. 

Creating a reputable business is just the first step to adding value to the opportunity you offer. You should also showcase how you can support them through their journey, create a business mission to align with and explore ways to innovate and exceed expectations in your industry. 

To offer value, consider offering competitive and fair pricing to start their franchise journey. Talk with franchisees to offer support and assistance with practices like software and inventory. When you collaborate with your franchisees, you can understand their needs and provide them with direct support with what they truly need - not just in the beginning, but anytime throughout their journey.

6. Stay Consistent with Your Brand

Marketing is another large aspect of your franchise's success. Creating brand continuity is essential in bringing customers back to your locations, no matter where they are. When people see your brand, they should know to expect the best. To create brand continuity, you will need to adhere to high standards of excellence and quality assurance when building your franchise. Train recruits to understand the expectations of your products and services to achieve this consistency. 

Customers love supporting franchises because they know what to expect. They have been here before, had a great experience, and expect that same treatment at their next visit. Creating loyal customers depends on consistency and reputation. Although you want your franchisees to feel comfortable trying new things and spreading the word in their local community in their own ways, you need to set clear expectations on the quality and service you expect.

7. Work with Expert Franchise Consultants

Once you have a successful business, you may be ready to expand your business with franchising. Creating resources, recruiting the right people to join your venture, and establishing a consistent brand within your industry can all be more difficult when you start to replicate your business in multiple locations. To work through any difficulties associated with franchising your business, you may want to work with franchise consultants. 

Conclusion

Our team has extensive experience building large brands, creating scalable business models, and recruiting and training franchisees to help you grow and franchise your business. Consultants have the answers to those questions that you may be struggling with as you learn the franchising framework.

Let the FMS Franchise help you through every step of your franchising journey! To learn more about our experience and services, get in touch.

How Does a Master Franchise Work?

A Master franchise may also be described as an Area Representative or Area developer franchise, it is basically when a franchisee buys into a franchise brand to not only operate a location or locations of the brand but also to represent the brand. When a franchisee becomes a Master franchisee owner they become a Sub-Franchisor of the brand and now take on a very different role than a traditional franchise owner. 

As a Master Franchisee, they would typically purchase the rights to a market where their job is to sell and open franchises of the brand.  

How do you Price a Master Franchise?

The price for the Master Franchise is wildly variable, but the formula we’ve used most frequently is the following;

Take the total number of units that could be opened in a market, let’s say the franchisee is opening in California and you determine that 50 locations are possible there.  If your franchise fee was $35,000, this would be a total aggregate of franchise fees equaling $1,750,000.  We typically price a master franchise territory by taking 10-20% of that number, so at 20% this would be a master franchise fee of $350,000.  

How does the Master Franchise Model work?

After the purchase, a master franchisee would typically agree to open at least one unit franchise to use as the prototype unit for their market.  This unit would be used for discovery days in franchise sales and for franchise trading purposes in franchise support.  The master franchise agreement would specify a development schedule which outlines how many units the master franchisee needs to sell and open each year.

The ongoing fees (both franchise fee and royalty) would then be split between franchisor and franchisee. The standard would be 50/50, but this will vary depending on roles and responsibilities. For example, if the master franchisee is doing less training and support, you as the franchisor may keep 70% of the royalty fees and pay the master 30%.  

Why do Companies do a Master Franchise?

First, the obvious reason should be master franchising allows you to grow faster and expand into more markets. Brands such as European Wax centre and Subway expanded very efficiently with master franchising.  

Second, Master franchising allows you as the franchisor to operate leaner with less overhead and fewer people in the field.  The master franchisee is taking on training and support functions so you don’t have to.  

For more information on how a Master Franchise works, contact us:

5 Factors to Consider Before Becoming a Franchisor

The idea of owning your very own franchise operation can feel daunting, to say the least. So let’s break it down together! A successful franchisor is first and foremost an informed one. We are here to let you in on all the essential tips and tricks of the trade. 

A quick look at these fast facts can get you up to speed on everything you need to know before considering franchising your business. Let this list be your guide to learning the fundamental ins and outs of franchise development.

1. Build a Strong Foundation

A primary consideration when thinking about ways to build up your franchise is your foundation! What does the basis of your business look like? The model for franchising works to efficiently expand on exactly what is at the core of your enterprise. 

Creating a franchise development strategy based on a stable foundation is one of the most effective ways to grow your brand. Utilizing an expert franchise advisory service such as FMS Franchise can transform this promising groundwork into a thriving venture in no time. 

2. Know the Competition

Before taking your franchise to market, think about exactly who you’re competing against. Being able to identify and understand what has and hasn’t worked within the market will only serve to inform the way you structure your franchise business model. 

Take a good hard look at the industry surrounding your enterprise through primary and secondary research. FMS Franchise is integral in using these detailed figures to help create a solid and secure business plan. Remember, existing competition can change once you enter the franchise marketplace

3. Structure Your Franchise Business Model

Customization is essential! Finding the operating system that fits best for you will ultimately create a smoother and more successful business. A few important factors to consider incorporating are technology, professionalism, creativity, partnerships, and communication all to differing degrees. 

At FMS Franchise, we evaluate your business in order to figure out the exact amount of each element needed to create the recipe for your franchise success. From fee structure to territory sizing, there’s no detail too small for our team of experts. 

4. Create Brand Trust 

Building brand trust is a key factor for any successful franchisor. Consumers want to buy from a team that they know and trust and franchising expand your ability to communicate honestly with your customers. As such, it can become one of the highest values in the franchise business. 

FMS creates brand trust by ensuring that your values and mission as an enterprise are reflected in your marketing. It all begins with internal integrity and culminates in being a reliable service that your clients can always count on. Transparency can go a long way in earning confidence and credibility. 

5. Utilize Support 

Last, but probably most importantly, you won’t be alone! It’s proven that the most successful launches are done with comprehensive guidance along the way. With decades of experience, we’ve been able to help over 600 clients expand their businesses efficiently and effectively. 

You will have access to the expert guidance of our franchise development group every step of the way. Our industry specialists offer all the support needed to help build up your brand and reach your full financial potential. 

Now that you’re well versed in what to know before becoming a franchisor, you’re ready for a free consultation call. Visit today to take the next step. 

Top 5 Trending Industries For Franchising Today

Here are the top 5 emerging and trending industries for franchising today in the USA.

  1. Health and Beauty Industry
  2. Food and Beverage Industry
  3. Services Industry
  4. Education Industry
  5. Home-Based Industry

1. Health and Beauty Industry

What is franchise development when talking in terms of wellness? Many people are asking that very same question as the market for health and beauty brands has grown in recent years. There is massive consumer demand across many categories in this specific segment. This includes hair care, make-up, massage, acupuncture, fitness, skincare, and lash extensions. The branding and digital marketing opportunities appear to be endless in this segment. We’ve especially seen significant growth in franchising gym locations around the world.

2. Food and Beverage Industry

Any franchise consultant will tell you that food and beverage is often a safe business bet. It will likely be one of the world’s leading market segments. As they say, people gotta eat! Some of the most iconic brands to ever franchise come from this industry, like McDonald’s or Subway. Their global presence continues to affect the franchise business model today. Franchising has proven to be one of the most effective ways for restaurants to efficiently and effectively grow their brand

3. Services Industry

FMS Franchise is a top franchise consulting company, especially within the services industry. In recent years, services have become one of the fastest-growing market segments for franchising. It can encompass quite a wide range of models as well, from landscaping to payroll management. As a leading franchise development company, we always encourage a service business to get in on this action. They have high-profit margins and a low overhead, which decreases the general risk involved and makes it more accessible to the average entrepreneur to enter into new markets. 

4. Education Industry

Investing in the future of our society is and always will be an essential endeavour. Children's education in this modern day and age is more important than ever. It’s proven time and time again to be one of the most consistently fast-paced franchise market segments around. People will always want to make a difference in the learning lives of little ones, regardless of their economic state. Creative and high-margin models can benefit everyone when working to franchise within the education industry. 

5. Home-Based Industry

The homes based franchising market is an excellent vehicle for growth. It has become a stable segment over the past decade, and the pandemic pushed its potential even further.

Improving the space you live in is the ideal investment for the current generation of remote workers. Starting a business from the comfort of your own home also offers low overhead and a great potential for work-life balance

Takeaway

At FMS, we’ve seen many home-based franchise models develop and scale successfully, and the timing today has never been better. If you would like to break into the franchise market with any of these trending industries, we recommend learning more by getting in touch.

You’re in Good Company with FMS Franchise

FMS Franchise (FMS) is a strategic partner for new and existing franchise businesses. Through the creation, launch and execution of effective growth strategies, FMS Franchise helps ensure your success and legacy.

As a franchise consulting company developed by entrepreneurs and for entrepreneurs, we offer a range of services that provide marketing and sales support to FMS clients.

Whether you are looking to franchise your own business or sell your franchise business, our team is here to assist you. Offering far more than simply buying and selling, FMS Franchise takes an active role in research, conversion, metric tracking and more, giving you everything you need from one strategic partner.

With our focus to provide you with customized and effective franchise development services tailored to your business needs, there’s no need to go elsewhere.

FMS is Proud of What We Do

The clients we serve and the success we’ve helped others achieve. The numbers speak for themselves:

You’re in good company with FMS Franchise. The processes of developing, implementing and marketing a franchise system require expertise - one that comes with years of experience from people who are in the business of franchising.

Franchising is a tool to grow your business, giving you the ability to expand into new areas and achieve massive market penetration in a short period of time. By franchising your business, you can bring in investors without giving up control of the organization's direction or decision-making ability.

Franchising enables a company to swiftly and successfully create a brand and a sustainable competitive advantage.

Growing your business is made easier with the support and guidance of FMS, as you can unlock much more potential than you can with just one location. As you expand, you will increase your chances of becoming a reputable leader in your industry.

With the help of our marketing strategies and channels, we promote quick expansion and business growth. Our team is trained to assist with recruiting and training resources to jumpstart your franchise and lead to sustainable practices over time.

Working with FMS Franchise, you have consultants who have real experience in the field of franchise business development and we are the only full-service franchise consulting agency offering sales and marketing support to our clients, giving you the peace of mind that your business is in the best hands.

FMS Franchise - Working For You, With You

Looking to develop your franchise? Maybe looking to sell your franchise? You need a franchise management system to work for you, and with you. Since 2009, FMS Franchise has created and implemented franchise distribution models for hundreds of brands.

Our in-house franchise consultants make up a 28-member team to provide all of the resources required to execute a successful franchise model. From buying to selling, from supporting to launching, FMS Franchise has you covered for every aspect of the franchise business.

The fundamental premise of Franchise Marketing Systems is franchising a business effectively and profitably without large upfront fees or high overhead for your new or existing organization.

The FMS Franchise model is one of the most cost-effective franchise development options available in the franchise industry.

With more than 200 years of combined franchise expertise, FMS will assist you in every aspect of developing and managing a successful franchise business by creating a more profitable and efficient franchise model.

The franchise industry has thrived with more opportunities over the past twenty years than ever before. Those looking to enter into franchise development, or those looking to sell their franchise business, are on the cusp of fresh possibilities and propositions.

Franchising can help you expand your business. Partner with FMS to assist you in developing, defining, and structuring your franchise to launch new locations under your brand in new markets. Franchise expansion can quickly scale your brand with independent owner operators that believe in your approach and mission.

Are you ready to turn your business idea into a franchise? Our expert consultants will assist you to grow your business. Contact us today.

4 Diverse Revenue Stream Ideas While Franchising Your Business

Revenue streams allow businesses to earn better profits from multiple sources. During franchise strategy development, plan on building various revenue streams that ensure you have a steady cash flow instead of relying on a single revenue stream.

You need to do your homework on what the industry average is in that market segment when it comes to franchise fees, royalties, advertising funds and local advertising investments.  However, you also need to be cautious and not overburden the franchisee with these so that he makes a  solid profit and is motivated to grow the business long term.  

These fees are not something you want to change often unless something dramatic changes that make you feel like you should reconsider the fees in place to keep it fair for both parties in a franchise agreement. Keep in mind, that changing any of these fees requires considerable franchisee notification and explanation, and should not be taken lightly.

Common Franchise Revenue Streams Options

Franchise revenue streams will generate your initial and ongoing income. You can divide the fee structure and build multiple revenue streams in the franchise development process. You should consider each stream as financial support that continues to grow your business while expanding it to new geographies.

Here are some common but diverse revenue stream ideas while franchising your business:

  1. Initial Franchise Fee
  2. Royalty Fees
  3. Supply Chain Mark-Ups
  4. Advertising Fees

1. Initial Franchise Fee

One of the most common revenue streams is taking initial franchise fees from the franchisee. After signing the franchise agreement and paying the franchise fees, you will shift your rights to the franchisee and allow them to sell your products and services under your brand name.

The average initial franchise fee ranges from $20,000 to $50,000. The franchise fee is a one-time payment and most investors are aware of this when they start considering franchises to acquire.

2. Royalty Fees

Your franchisee has to pay you the royalties on a weekly, bi-weekly or monthly basis, depending on the terms of the franchise agreement. You create the general payment structure of the royalty fees, either stipulating a percentage of gross sales or charging a flat-rate fee.

Create your royalty fee payment structure after assessing the market of your industry within the franchise geography. Moreover, consider the deal value and length of term to ensure you derive ample profits through the royalty fees without making the franchise look any less attractive as an investment.

3. Supply Chain Mark-Ups

The vendors your business works with can pay you a percentage of the total amount of purchases made by your franchises. This profit is called supply chain mark-up or rebates. To set up this revenue stream, you need to disclose the vendors on Franchise Disclosure Document (FDD) and how much rebate you will receive annually.

You and the franchisee are equally responsible for the franchise’s success. Therefore, don’t partner with vendors that sell highly expensive products. You might receive a high annual rebate but the franchisee will struggle to make the payment to vendors. It’s simply better to choose vendors that supply quality products at affordable prices.

4. Advertising Fees

In the advertising fee revenue system, the franchisee must pay you a specific amount of money to promote and market the brand. The advertising fee is a set percentage of gross sales and is calculated bi-weekly or monthly. 

You should keep the advertising fee management separate from royalties and other revenue streams because it is not part of your income. The advertising funds are provided “in trust” to market the brand on different platforms.

Conclusion

Every revenue stream you plan during your franchise strategy development should ideally bring long-term value to you and the franchisee. It should also be easy to execute and should not put a financial strain on your franchisee(s). You can invest the profits coming from cost structure and revenue streams at the core of your business to provide support to your franchises to make your business more sustainable and poised for future growth.

At FMS Franchise, our franchising and marketing specialists help franchisers by streamlining the process and assisting them throughout the process. Get in touch right and start to close your first franchise deal.

5 Key Factors of Successful Franchise Development

When any business owner with a growing business thinks about expanding into new markets, one of the avenues to consider is franchising. So, what is franchise development? The process of franchise development is a proven avenue for turning a successful business into a successful chain both regionally and globally.

There are many factors that go into the franchise development strategy. Imagine if you will, a complicated recipe at the heart of a strong recurring business. This recipe, when done correctly and with proven ingredients, will feature all the components necessary to make it repeatable and reproducible by others.

FMS's expert franchise consultants have identified these 5 key factors of successful franchise development:

  1. Drafting a Franchise Business Development Plan
  2. Completing the Franchise Legal Process
  3. Create Operations Manual & Training System
  4. Marketing In The Franchise Development Process
  5. Work With a Reputable Franchise Development Company

1. Drafting a Franchise Business Development Plan

Laying out your franchise business development plan and growth strategy is a very important process. This will help you and your investors to be able to visualize the direction that you want to take with the franchise. This is also something that you will be able to use when you are in negotiations with them so that you will already have all the statistics and information that they need.

A good overview of franchise strategy development should include the products and services that will be provided. The description of the buyer should include the details such as their income bracket, location and demographic details etc.

A detailed financial analysis will enable a business owner to get an idea about the feasibility of his business expansion program, and a franchisor should also prepare a detailed analysis to target potential franchisees in specific regions.

2. Completing the Franchise Legal Process

The second factor of the franchise process involves completing the legal processes necessary before filing for state registration with designated states. Franchising an existing business or starting a new business through franchising can take as little as a few months or as long as several years to complete for newly developed businesses. In either case, legalities must be followed. 

These legalities fall into place in multiple states, and it takes careful planning to address each requirement with care. Therefore, without any exception, you need to find yourself a professional who understands how to create your Franchise Disclosure Document (FDD) based on the standards set forth by the Federal Trade Commission.

This is not something that should be done solely by someone with experience in franchising, but also an attorney who is familiar with the UCC Code, FTC regulations and requirements, and writing FDDs and FAs.

The franchise legal process is essential in a successful franchise system. A strong foundation will lead to a strong franchise network with potentially solid revenue and profits for years to come. As with most things in life, it is all about being prepared for what is ahead, making sound decisions and staying organized.

3. Create Operations Manual & Training System

The Franchise Operations Manual and Training System​ provides a comprehensive way to create documentation and is necessary for training on a franchise level that is easily repeatable. While most franchisors develop their own operations manuals, many don't take the time or resources to make sure they are done properly.

Solid training is essential for franchisees to know about business operations. The franchisor is legally bound to create a well-documented guide to ensure comprehensive franchisee training before the new franchise commences business. The franchisor also has to provide ongoing support and refresher training to ensure the chain has standardized products and services offered.  

Documentation, training, and operations manuals are necessary for the successful growth of any business that is franchising. If steps are not well documented, you can often run into problems that may hinder the development and operation of your franchise system.

4. Marketing In The Franchise Development Process

Marketing is an intangible element of franchising and is primarily based on your ability to sell the concept of franchising to franchise prospects, once the franchise process is complete.

The use of collateral materials including franchise websites, brochures, franchise presentations and flyers should be carefully crafted to pique the interest of potential franchise buyers and make them aware of all the advantages associated with owning a franchise business that offers products or services which are sold under the brand name of your company.

These materials will provide information on the number of units already in operation, locations where units can be found and contact information for those interested in owning one of these franchises.

5. Work With A Reputable Franchise Development Company

Working with a reputable franchise development company can make all the difference when learning how to franchise your business.  Franchise Marketing Systems has helped hundreds of companies start and develop their business models into franchises. 

The process can be intimidating, and FMS is here to help. We have put together a range of franchise services to offer our clients the best chance for success – whether you’re looking to build your own franchise or sell your franchise business. 

Call Franchise Marketing Systems today and find out what an experienced franchise consulting group can do for your business.

5 Key Factors of Successful Franchise Development
5 Key Factors of Successful Franchise Development