If you have a unique business model that has had success, you may want to consider franchising your business. Before you actually make that huge step, there are some things that you must do or think about doing. You need to have a good understanding of what franchising entails. You should also know the related cost when it comes to a franchise and the necessary skills that will allow you to be successful at franchising. The main concept is expanding and growing your business into wider territories without having to be onsite. The time and money required means you will need a sound strategy to be successful.
Assess Your Business
You should first know if your business is franchise-ready. Therefore, the first step is to assess your business. You can have huge sales and profit, but you also have to evaluate your business concept, whether it is unique or not. For example, if you have a pizza shop that serviced organic pizza, this would be considered unique. Pizza is familiar to everyone and these days, many people are into organic eating and cooking. You can even add a new twist by delivering the pizza in only hybrid vehicles, for example. This might sound extreme, but the idea is to make your business concept believable, appealing and more than just ordinary. You should create a system that can be replicated by anyone who is adept to training. You must be able to sell your business concept and it should be alluring to the consumer.
If your business is seeing good profits and is something that you can clone, it might be ready for franchising. People who are interested in franchises will usually look for a business that has proven profitability. If you have more than one profitable unit within your business model, then it makes a franchise more enticing. Your business should be growing and earning profit.
It is time to conduct extensive market research. Don’t just follow your intuition. This is not going to help you. Research your market so you can be sure that there is consumer demand outside of your city. Your research should be able to tell you if there is enough opportunity in the marketplace for a new participant.
Get ready for change. You are going to need time to engage in your business franchise. You have to spend time training the franchisees and helping them to understand the business concept. You will now be involved in franchise sales and supporting those who purchase the franchises. Are you ready for the supportive role? Are you ready to give up control of your initial business? This is what you may have to do. Some franchisees won’t follow your exact business model so if you are stuck on the concept, you may have to reconsider franchising.
Other Things to Consider
You should also think about the legalities of franchising. You have to register a disclosure document with the FTC. You have to provide a large scope of details about your business. This will include audited financial reports, operating manual for the buyers of your franchise and a description of the business experience that your management team has.
In addition, some states have other rules and guidelines that you have to follow and there may be cost associated with this. You want to make sure that you are following the right steps. Therefore, you could hire a skilled franchise consultant to help you. You could also seek help from a franchise lawyer.
Franchising a business can take time. It is usually a long process. So be prepared for that. You also will need to take time away from your own business to support for the new franchise owners. Bear these things in mind when you consider franchising your business.