If your small “mom and pop” shop starts to get recognized in a particular community and becomes quite popular, perhaps it will be just as popular in another community too. Moreover, if your business has a particular look or identifiable brand, and a portable business model, perhaps franchising is the smartest next step for your business. Franchising is a unique way to grow your business that involves licensing your brand and business model to a franchisee. A franchisee will use their own start up capital to open up a shop that is exactly like the flagship store and will pay you a commission of the monthly or annual sales. Here are 5 things consider before franchising your business.
1. How much room for growth is there? It is important to do your research before you are ready to make your business ready to franchise. You might think that your business will thrive in another community, but there might be a few factors you haven?t thought of before. Moreover, what if you want to take your business global. Will your business model work in the most remote parts of the world, one with a totally different culture?
2. Can you afford it? Yes, the franchisee will need his or her own capital to open up a franchise of your business, but you will need the capital to hire a lawyer who will draft all the paperwork and make sure that you are positioned to franchise. There is a lot of paperwork involved and it can be complicated for anyone to sift through. And you want to have all the right documents signed and notarized, because you don?t want to lose your business or the franchise. So, it is important to have the money to pony up to a lawyer.
3. Have you created a structure and protocol manual? Creating a detailed protocol and structure list is important because you want each and every one of your franchises to maintain the same integrity as its flagship. That goes from the way people greet customers at the door to the exact placement of lettuce on a hamburger. The whole concept of a franchise is that anyone can buy any item at one franchise and still find the same exact item at another franchise hundreds of miles away.
4. Have you made your business available on a directory? Letting the world know that your business is available for franchise is important. This is why franchise directories are so useful. Sites likes?FranchiseExpo.com?give business owners the opportunity to make their establishments available to franchisees across the world.
5. Are you ready? It takes years of experience and know-how before you can make your business available to franchise. Not only do you need the capital to back up your forecasts that franchising will be successful, you need to have a track record that your product or service is marketable and salable across a wide demographical spectrum. You don?t want to wind up franchising your business, only to realize you needed a bit more time. The key to success isn?t just about striking when the iron is hot, but having the sense to know if it is hot and if it will stay that way.