Franchising a Business “An Overview”
by Ed Teixeira
For business owners considering franchising their existing business here
is a straightforward outline of the franchising process.
Franchising provides the financial and operational leverage to grow and
develop a small business. Franchise system growth can be limited to a geographic
area or nationally and it can provide growth and opportunities for ownership and
employees. For the proper franchise system international expansion is a definite
possibility
Attributes of Successfully Franchised Businesses
Have a unique appeal A business operation that can be systematized Sustained
profitability A product that’s a trend not a fad. Operating the business is not
complex Owners have the capital to establish and launch a franchise program
Typically the business has broad market appeal but it’s not an absolute
requirement Franchisee can earn a reasonable ROI
The Three Stages of Franchising
- Stage 1: Building the franchise program
- Stage 2: Launching the franchise
- Stage 3: Managing and developing the franchise network
“If problems arise it’s usually during Stage 2”
Key Steps in the Franchising Process
Conduct a feasibility study to determine viability of franchising the
business. Establish a plan and set timetables. Do a competitive review and
market analysis. Layout and write the operations manual. Construct the Franchise
Disclosure Document Enhance the website with a franchise site Design basic
marketing materials Establish franchise development strategies Audit financial
statements.
Preparing Your Business to Franchise
- Register your trademarks and domain names
- Confirm that the business can be franchised
- Have clean financials that can be analyzed
- Source sufficient capital
- Plan staffing needs
- Implement strategic, software and operational changes with
franchisees in mind
- Have a sound website platform
- Set up a new corporation
The cost to franchise an existing business can range from $50,000 to $100,000
or more depending upon the complexity of the business.
© 2012 FranchiseKnowHow, LLC
Ed Teixeira is the President of FranchiseKnowHow, LLC. He
can be reached at franchiseknowhow@gmail.com
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