If you find that your business is rapidly growing and others are showing interest in replicating your model, you should look at the franchise model. In order to do this, you need to ascertain whether your business has been consistently profitable over a substantial period, develop a business that you can teach to your franchisees and that can be replicated.
The next step is to determine whether your prospective franchisees have the capital that they need to open and operate franchises and service your business solutions. Here are guidelines that your company can follow to create a favourable franchise:
Clearly articulate your business:
Businesses should know what their brand is and how to sell their concept and plan. For the franchisee, a business should be systemization, organized outlines for operations, communications and methods for franchisees to attract new customers. You should describe every facet of the brand and its operations.
Replicate your business:
The business should be a running, thriving and successful business model that does not need the owner to personally run it. It should be able to survive the day-to-day workplace challenges and provide the right mix of business solutions. Ensure that your business has implemented marketing campaigns and works on building up customer relationships.
Create your franchise model:
On first instance, you need to draft the paperwork with a legal advisor. Some of the points to be included are, the franchise fee and royalty percentage, territory size, business experience and net worth. Adequate training can help franchises implement their business solutions successfully.
Create a strong support system:
If you need to run and know the cost franchises are going to incur then you need to put in place a strong support team. As an entrepreneur, you need to have a unified business system in place and experts like public relations, advertising, graphic design, equipment and support management, training and legal issues. This will enable you business to run parallel with all franchise functions
Develop a training manual:
This will create the basis of your franchise, wherein the franchisee is trained on several verticals that could include sales, financial and administration. Organisations should get the help of a consultant to assist with overall legal guidance.
Screen your franchisees:
You should understand that the franchisee is someone that represents the brand. Apart from the documentation and the financial information, you should consider the personalities of the business owners who would buy into your franchise. Gather market research about the company’s track record and the income expectations.
Support your franchisees:
As a franchisor, you would be expected to train your franchisees and guide them. You should spend time and money recruiting new franchises. There will be some handholding involved in some cases where entrants are new to the market.
True cost of franchising:
Before you start to understand the cost franchises will have on your business, SMBs should know that this would work when large sums of money are in play and when you are willing to lose it all. Companies should provide the right business analysis in order to gather investors and invest a personal financial stake in the venture. In order to create a successful franchise, entrepreneurs have to be visionaries who believe in their product.
They need to be able to build the right relationship between franchiser and franchisee for sustained growth. Franchising requires commitments and building a sustainable business and long term profitability. If you need your franchise module to work you should gear up for years of preparation, implementation and late hours.