Not every business will—or should—be franchised. But if replicating your business is part of the vision you imagine in your future, franchising is one of the fastest ways to grow. It’s never too early to start learning about it and preparing for the possibility. After all, even if it never happens, you’ll still be a more astute small business owner and will have lost nothing in the process.
Here are eight tips that will help you plan from forbes.com:
- Get organized. Think through and document in detail the inner workings of your business. Everything from training to signage to customer service will need to be replicated. And if you don’t end up going the franchise route, this is a valuable exercise that will help your business run more smoothly and efficiently.
- Engage an attorney who specializes. Have some preliminary conversations; know what lies ahead. If/when you’re ready to begin, you’ll need to do things like complete a Franchise Disclosure Document, set pricing and determine intellectual property protection, among others.
- Be selective. This isn’t hard for business owners who tend to be very particular about all aspects of their businesses. Choosing franchisees is no exception; it’s got to be the right fit and should come only after a long due-diligence process.
- Build and protect your brand. It becomes an even more valuable asset with franchising. It’s also at greater risk, because others will be representing it. Even so, you need to make sure that every detail of your brand assets is controlled and monitored. At the end of the day, brand is all have!
- Location, location, location. This is a complicated process. Start closer to home and then build out. Make sure locations are accessible, because you’ll be visiting from time to time.
- Tap into mentors. Surround yourself with people who’ve been there, done that. Start by asking your attorney for suggestions.
- Have a growth plan. There’s a big difference between wanting to be a regional powerhouse and having an international presence, for example. Be specific about your aspirations.
- Be ready to support franchisees in every way. Franchisees need to be connected to the “mother ship.” Put channels in place for communicating, advising, getting feedback. And make sure franchisees are connected to each other.
As an alternative, buying a franchise can be a way to expand your business sphere, return to being a business owner or become one for the first time. Just as franchising a business requires an extensive amount of thought, planning and legwork, acquiring a franchise requires serious due diligence, as well.
Franchising expert Joel Libava, also known as the “Franchise King,” says that while buying a franchise is a popular option, there’s more to it than meets the eye. So potential franchisees need to approach it with eyes wide open and with some specific knowledge.
Take a look at what CNBC.com lists as The 10 Top Things to Know Before Becoming a Franchise Owner.
- Understand the franchise model. Buying it is one thing; running it is something else.
- Know your own tolerance for risk. You can mitigate the risk but can’t eliminate it.
- Understand the rules—there will be many.
- Do a self-check: Is your personality a good match for being a franchisee?
- Analyze your financial situation. You’ll need to know exactly where you are.
- Search based on your skills and experience, not on what’s out there.
- Do your homework—lots of it. Have a process in place for analyzing the opportunities, determining possible matches and ultimately, making the decision. Ideally, you’ll have an advisor or mentor or two who’ll be brutally honest and provide routine reality checks!
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