5 Must-Know Tips for Franchising Your Company
Many business owners consider franchising because it can provide the opportunity to grow their business fast -- but it may not be for everyone. Here, five important tips that cannot be overlooked when planning your franchise model.
1. Have a clear core concept
As a business owner, you may be comfortable running on intuition. But as a franchisor, you'll want your franchisees to have a plan -- your plan -- in place for even the smallest of daily operations.
Every step of the business must be included in your system, and that means the franchisor must know their business inside and out. You can’t expect your franchisees to understand the business if the franchisor doesn’t have a clear, defined concept themselves. Any directions on the operation of the business must be provided to each franchisee explicitly.
2. Pick franchisees with care
Recruiting the right franchisees is one of the most important aspects of franchising your company.
The old adage "Never marry in haste" could certainly apply here. The relationship between the franchisor and franchisees is a long-term one. Significant time and money will be invested and without careful recruiting, unforeseen problems could become drawn out and bitter.
Don’t recruit the first potential franchisee that initiates interest. Refrain from giving the first few franchisees special deals by being consistent in dealing with all members of your network. As a franchisor you must be aware of where the franchisee is getting their funding and what their repayment terms are. Lastly, a franchisee should be entrepreneurial minded but not so much that they cannot work within the franchisor’s system.
3. Invest seriously in training
Solid training benefits both the franchisee and the franchisor.
On the most basic level, solid training helps the franchisee understand the basic components they need for daily operations. It also ensures a smooth and successful start. Training helps franchisees ensure their employees have the right skills as well as rise to challenges that will most certainly come.
As for the franchisor, solid training helps get your franchise off to a correct start. Most importantly, it minimizes errors that will result in the franchisor spending valuable time trying to correct those errors. This allows the franchisor staff to spend their time more productively. Lastly, solid training increases profitability.
4. Keep tight controls
Control begins with the franchisor providing significant help in operating the business with a proven marketing plan. Beyond this initial start, it encompasses numerous aspects of the franchisee’s operations: promotional campaigns, accounting practices, personnel policies and being clear on hours of operation are just a few.
5. Systemize for emulation
Emulation, simply put, is when a second system duplicates the behaviors of the first . For optimal profitability, your franchisees should be duplicating your system as franchisor.
You should be spending significant time studying and documenting the systems that have made you successful for your franchisees to step in and emulate. Without this vital step, success will allude your company. It’s critical that the franchisor keep in mind that they're not selling just a product or service -- they are selling their system for success.
Entrepreneur Editors' Picks
Crypto Doesn't Have to Be Serious. Just Ask This Comedian Who Organized a Conference About Failure in the Industry.
Want to Succeed? Turn Your Fixed Mindset Into a Growth Mindset.
Google's CEO Is Asking Employees 3 Simple Questions to Boost Productivity
'Greatest Storyteller Wins.' Katy Perry on the Surprising Link Between Pop Stardom and Entrepreneurship.
The 5 Personalities You Meet in a Coworking Space
'Man's Best Friend' — and Investment: The Thriving Industry of Pet-Related Franchising