Can you franchise your business?

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10/07/2017

One of the best and most effective ways to grow your business and see a major spike in profits is to turn it into a franchise.

The main factor to identify is whether or not your business can be replicated. It’s also important that there’s a demand for what you’re selling – is it so popular that it can be sold in different locations, by other business owners? Think of successful franchises – ones you know locally, and those that are globally dominant, like McDonalds – and ask yourself if your business has what it takes to follow in their footsteps.

Does your business have what it takes?

Businesses that successfully become franchises are those that have robust and efficient systems in place. If your business runs like a well-oiled machine with great systems and streamlined processes, including well-trained staff, then there’s a good chance it could become a franchise.

Your processes and systems will have to be:

• Easy to teach to franchisees and their staff – For example, could someone pick up how to run your business from a manual or through training?
• Outlined in writing – by creating an employee handbook plus an operations manual, you’ll begin to be more franchise-friendly.
• Supportive of new franchisees and their needs – mainly after their initial training because of the physical distances between franchise outlets.

If your systems and processes can be easily and clearly explained to potential franchisees, you’ve ticked a major box on the checklist. When you’re assessing whether your business has what it takes to become a franchise, try and tick these boxes too:

• A unique process or way of delivery that other businesses will find hard to copy, and protected by patents if possible.
• A great brand that is protected by a trademark, and recognisable advertising.
• An exclusive supply of products or materials from suppliers.
• Be able to source product or materials at a substantial discount for volume that a business on their own wouldn't achieve.
• Contracts, permits or licenses that you can transfer.

The franchisor – your role

It’s important to ask yourself if that’s the kind of role you want to play. Your business will continue growing with you at the helm, but only if you make sure that your franchisees have the knowledge and support to run their franchises profitably.

Develop long-term relationships with your franchisees. Franchise relationships don’t always run smoothly, so to reduce tension it’s important to keep open lines of communication. Let franchisees suggest improvements to your business, which could be rewarded.

When you decide to become a franchisor you’re effectively balancing your time between your core business and the franchise. You’ll be able to create a faster-growing business by embracing growth and the technology that comes with it.

Review your business – the demand for what you’re selling, your systems and processes, and your own abilities as a leader – and if you can tick those boxes then your business could well become a successful franchise and achieve a whole new level of growth.

Advice and resources

• Forbes has 8 tips on how to get started franchising your business.

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