There are almost one million franchise businesses in America. From plumbing services to fast-food, the franchise model provides a turn-key means for entrepreneurs across several industries to fast-forward their business ambitions and become immediate owners of a successful brand. The franchise model also provides brands like yours, exceptional benefits.
So, should you franchise your business? The answer to that question is a resounding maybe.
Our team breaks down key items you’ll want to think about before throwing your company into the franchise machine. That way, you can confidently determine if franchising makes sense.
Keep reading to learn more!
Franchising Is a Low-Cost Way to Expand
The first thing you should know before you learn how to franchise your business and decide on doing it is what the upside to franchising is. In short, franchising offers business owners a unique means of expanding their brand’s footprint.
In this model, franchisees will pay for the right to open and own a new location of your company. Franchisees manage all costs and labor associated with picking a location, hiring people, and day to day operations. The upside for them is that they get to generate revenue via a proven business model/brand. The upside for you is that you get to collect franchise fees.
Your Brand/Business Needs to Be Successful
You’re going to be hard-pressed to find an entrepreneur to buy into your franchise if your brand/business isn’t a proven success. Who would want to pay for the privilege of running a failing venture?
So, before you focus on expansion, focus on making your business model as successful as it can be in its current state. Then, when expanding seems like the only way you can tap into new revenue opportunities, you can consider going the franchising route.
Brand Consistency Is Key
Franchising your business means trusting a third-party to manage your brand’s reputation. Ensuring franchisees meet your standards on that front takes work.
Success with brand consistency starts with making clear via franchise agreements and style guides how locations should look, what services/products need to be served, how customers should be treated, etc.
The moment you lose control of your franchisee’s standards is the moment your company’s health will suffer.
Franchisees Rely on You for Success
Being the head of a franchised company isn’t a revenue generator that works on auto-pilot. Franchisees will expect you to take an active role in their success.
What that means will vary from business to business. Plan on at least helping your partners secure great locations, manage promotions, find ways to engage customers and market on a national level.
You Don’t Have to Franchise Your Business to Grow
Whether or not it makes sense to franchise your business after considering the unique work required for this expansion model is something you’ll need to mull over.
What we will say is if you’re unsure about franchising but are sure about growing your company, franchising isn’t the only path forward. Find small ways to make your primary location more successful. Pursue opening a second wholly-owned location. Those are just two examples of other possibilities!
If you need more guidance on the benefits of franchising your business, explore additional information here on our blog.