This is the first in an 8 part series of blog posts on the basics of How to Franchise Your Business. The series is meant to serve as a primer for those who are relatively new to franchising and who might be considering franchising their business. The blog posts will be written by Tom DuFore, Chief Operating Officer and Chris Conner, President of Franchise Marketing Systems. It will share lessons that they have learned along the way in their careers working in the franchising industry.
Franchising can be an extremely effective and profitable way to grow a business. It is the true definition of scale. Allowing others to prosper using a proven business model while effectively building and developing a larger brand with economies of scale and wider influence allows all parties to be successful.
The keys to franchising successfully are having a profitable business model and defining a consistent, validated platform to offer your franchise through. The business must then turn into your “product” and have defined franchise marketing and sales processes in place to deliver that product to your franchisees.
The marketing channels and systems used to effectively advertise and sell a business opportunity are based on different standards and follow a specific process – define what that is for your industry and your business model.
This blog series on how to franchise your business will give you insight into the process of franchising your business. Hopefully, this will help you in building your own business plan, thoughts and strategies as they pertain to your business growth.
How To Franchise Your Business: What is Franchising?
Franchising is the practice of using another organization’s or successful business model to replicate success through independent owner-operators. It is a special arrangement where the owner of a business known as the franchisor gives another independent individual known as the franchisee the right or authority to market and distribute his/her goods and services and use the business trademark for a certain period of time in exchange for a fee.
In simple terms, franchising is when a franchisee pays a fee for the right to use the business name and business system of the franchisor.
The Two Most Important Requirements for Success are: First, Being in the Right Place at the Right Time, and second, doing Something About it. Ray Kroc, Founder of McDonald’s
Franchising is considered to be one of the most effective methods an organization or business can use to distribute its goods and services as it seeks to meet or satisfy the needs of customers.
Franchising is a win-win business relationship where the franchisor gets a chance or opportunity to expand his market presence without having to use his own capital. The franchisee gets the advantage of gaining access to an established or stabilized business system at a lower risk. And third, the customer benefits by having greater access and availability to the franchise brands’ goods/services delivered to them by a caring owner operator
The relationship between the franchisor and the franchisee is mutually beneficial, with the full obligations and duties of each party clearly outlined in a detailed and comprehensive franchise agreement. The franchise agreement and disclosure document are customized for each individual franchise and explain the franchise opportunity including the costs, duration, renewal terms, and ongoing fees.
There’s no reason to be the richest man in the cemetery. You can’t do any business from there. Colonel Sanders, Founder Kentucky Fried Chicken
We hope that this will blog post will start to answer your questions on how to franchise your business. Stay tuned for upcoming blog posts to learn more.
If you are more interested in learning more about the Franchising Industry, please get in touch.