How to Franchise Your Business Effectively.
You have a good business....you see opportunities for growth and expansion....yet you lack the capital, the people and the time to take advantage of the market opportunity ahead. Franchising could be the alternative to help you build your brand, network, and revenue streams, but how do you franchise your business? It starts with a solid plan for growth - understanding the marketplace for your business, product, service or offering.....who is out there offering something similar in the franchise marketplace and how can we effectively compete with more established franchise brands? What should the franchise fee be for the model, the royalty percentage, the territory model and other items that will have an enormous impact all take careful calculation, planning and understanding prior to launching a franchise system.
Strategic Planning - Too often I have worked with anxcious entrepreneurs who see the light at the end of the tunnel and want to sell before they have a program in place. Do the due diligence, plan the model, build a program structure for both yourself as the franchisor and the buyer/investor or franchisee. Plan out the business model and be prepared to answer detailed questions about the franchise. Selling franchises is one of the most difficult and complex sales in the business marketplace, make sure you go into it with the best, most complete and accurate tools possible.
Franchise Legal Structure - franchising is a highly regulated marketplace and requires careful planning and management in order to avoid litigation or legal issues that stem from poorly planned franchise models. Franchise compliance is managed at two levels, Federal Compliance is managed by the Federal Trade Commission and requires the development of a Franchise Disclosure Document (FDD). The Federal Trade Commission rules require the use of a properly documented franchise disclosure and also a documented process in how the franchise is presented to the actual buyer. At the state level, certain states require that your franchise is registered as a franchise with them prior to marketing or even speaking with candidates regarding the sale of a franchise model. It is imperative that you follow these two levels of franchise legal compliance in order to avoid franchise litigation and the potential liability that arises from selling franchises without franchise registrations in place.
Franchise Operating Manuals and Systems - have a good system in place in order to present value to the franchise buyer. The ability to sell and develop franchises is directly linked to your ability to build, support and nurture franchisees in their own business once you have brought them into your system. Have the manuals, documentation and procedures in place that have been proven to work. Know the data, have the documentation to back it up and understand how to replicate your success. This is at the core of what makes a company a good franchise or a complete failure. Take the time, hire the right people and get the documentation in place to produce successful franchise partners.
Franchise Marketing and Sales -
In 2012, Franchise Marketing Systems clients sold 603 franchises. The process of franchising a business can work exceptionally well, given the right systems, brand, industry and leadership. Contact us for a consultation to discover whether your business is ready for growth through franchising.
How to Franchise - Contact Us
FMS is a team of expert franchise consulting professionals based in Canada that provides solutions for franchise development, franchise consultation, and expansion of businesses globally.