13 Jan 5 Key Factors to Consider Before Franchising Your Business
Going from the startup phase to the franchise phase can be a big leap, but it can happen. In fact, it can happen sooner than you think – especially if your establishment becomes quite popular. If your brick and mortar establishment becomes recognizable in a certain community, it may have the same power and potential for success in other communities. So, is your business ready to be franchised? Before you set the wheels in motion, you need to be fully prepared. Starting a franchise is not a cakewalk – you need to think about the legal implications, the financial implications, and a number of other responsibilities.
Here are five key factors to consider before franchising your business.
Do you think your business will be universally relatable?
It is important to make sure your business will be relatable in other communities. It may be that the recipe for success in your community may not work in another community. Other regions have different cultures, different modes of thought, and different interests – this is especially true when you go outside the country. This is why you want to do plenty of research – just to make sure your business will be welcomed.
Does your business have a look and feel that can not only be instantly recognized but also replicated?
When you make your business available for franchising – on a website – you want to have a packaged business model. You want a franchisee to be able to take your business and recreate it – top to bottom – in another location. For some businesses, it takes years to get to this point. If your business needs a few more years to build a look and feel, you may need to be patient and wait before you can start franchising.
Do you have the legal capacity to branch out?
From a legal standpoint, there is a lot of work to be done when you put your business up for franchise opportunities. Not only do you have to hire a lawyer, but also you have to start protecting your logo and other intellectual property – like secret recipes – so that other people don’t steal or borrow them. Plus, there are a lot of documents to be signed and contracts that need to be drafted.
Do you have the experience? Branching out takes experience and know-how.
Most people need years before they can confidently branch out. If you don’t have the experience, you may want to wait and learn more about your industry. There may also be more to learn about running your business. Ideally, you want to have at least ten years of experience before you start franchising your establishment.
Do you have the time? Franchising takes time – a lot of time.
If you are too committed to running your flagship, you may not have the time to run a franchise. However, if you have highly trained and trusted managers in place, you may be able to focus on the franchising phase. In the end, you’ll need to focus almost 100% of your energy on this phase, or else your efforts could be unsuccessful. In the end, there will be a lot of meetings, a lot of traveling, and a lot of quality control missions – if you can’t handle that, you won’t be able to handle franchising your business.