| When you develop a franchise system and sell franchises, you enter an interdependent relationship with your franchisees. Based on the mutual obligations of your franchise agreement, you need to make sure that your company (the franchisor) is in a position to select, train, open, and support the franchisees in your system and that you intend to do so diligently throughout the term of your relationship (5-10 years or longer). You are responsible for the success of your franchise system and the success and well-being of each franchisee in the system as well as the communities that they serve.
What do you need to ask before developing a franchise system?
Q. Who Should Attend a FranchiseRight meeting?
A. Every franchise development plan should start with an education about how to prosper in this lucrative market niche! You need the background and the tools regardless of your current size or position. Do you fit our typical attendee profile?
- “Idea Only” Companies Seeking Funding - The founder(s) of a pre-launch company (usually with central Internet Technology, patented products, and/or proprietary methodology) that should position the company for franchising to attract capital, rapidly build a national brand, or be recognized as the first-mover in the marketplace by quickly establishing a national footprint before significant competition sets in.
- Single Unit Operators - The principal of an existing 1-unit company (foodservice, retail, service business, etc.) that intended to franchise or license from the beginning (built prototype to franchise standards) and now needs to acquire franchise industry expertise before developing internally or outsourcing.
- Multi-unit Operators – An existing, well funded multi-unit company should send an executive or management level employee to learn about franchising and licensing so that the company can internally manage outsourced franchise developers and related vendors. Consider rapid expansion using committed capital and even more committed managers (they’re called franchisees).
Q. What businesses make the best franchises?
A. If your business meets much of the following criteria - Think Franchising now!
- Proprietary intellectual property that can be (or is) protected under U.S. and international patent laws.
- Trademark that can be (or is) Federally registered / Associated domain names registered.
- One operational prototype preferred (concept-only projects are also accepted)
- Concept suitable for Franchising and/or Licensing – capable of exponential expansion – very scalable
- Unique Value Proposition with product or service on the leading edge of key market trends
- Reasonable barriers to entry for business format franchise / Central software application for hybrid franchise
A. If your business meets much of the following prerequisites - Think Franchising now!
- Someone can learn to operate the business in three months or less
- Operating procedures can be documented concisely /
- Company “systems” or “methods” bring efficiency to the operation
- Limited competition in the market / Market has few or no recognized brands
- Business has national and international adaptability
- Developed technology that is not otherwise available to the industry.
- Proprietary products or products that can be modified to be proprietary
- Business is unique and differentiated from competitors with good branding
Q. When should I start to franchise?
A. It typically takes 12-months to plan, fund, and develop a “best-of-class” franchise system that can successfully open and expand profitably. Before you start that process, you’ll need education and evaluation, so get that started now; then tackle any recommended system improvement (required to be completed before starting the franchising process). Sign up for Boot Camp! |
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