4 Tips to Start a Franchise: A Short (But Complete) Guide
If you want to start a franchise in the US and looking for franchising guides online then it can be difficult to find enough information in order to make a clear and informed decision. That’s why we have created this simple but complete franchise guide covering all the essential components of how to start franchising your business. The main benefits of this franchise business model are an increase in system sales through new locations funded and managed by franchisees.
To build your own franchise means that you must complete all of the legal steps to sell your business systems and continuously support franchise partners in order to grow and expand your enterprise. Expert franchise consultants can offer a more detailed understanding of the process in order to franchise the right way from start to finish. Learn more below on how to franchise a business in the 4 easiest and most efficient ways below!
- Find out if franchising is right for you
- Issue a franchise disclosure document
- Create an operations manual
- Make a plan for franchise sales
1. Find out if franchising is right for you
The question that must come before, “how can I franchise my business” is “should I franchise my business?” This significant first step is all about discerning if franchising is actually the best fit for growing your small business. Consider your long-term goals and whether or not your business is potentially scalable with replicable systems. As a business owner, you need to remember that you’ll be entering a whole new industry and building something responsible for the success and ongoing support of multiple locations.
2. Issue a franchise disclosure document
If you determine that you want to start on the path to franchise your business, a franchise disclosure document will be the next part of the process. An FDD is the legal document required by law when franchising and selling franchises. It needs to be prepared and issued by a lawyer often with the help of a franchise consultant and will serve to inform all prospective franchise partners in the future. When creating this document be sure to be specific to your market, competitively position the offering, and include information about your franchise agreement, franchise fees, royalties, ongoing fees, start-up costs, and territories.
3. Create an operations manual
Preparing a confidential franchise operations manual that you provide to all franchisees as part of their thorough training process can take some time. It’s basically a comprehensive how-to guide for your specific franchise systems. As an important communication tool, it can help to inform franchisees about your standards and requirements in the business. In the operation manual be sure to include the brand’s mission and goals, how to open a new location, inventory requirements, marketing techniques, and administrative guidelines.
4. Make a plan for franchise sales
Once these other steps have been completed, it’s time to look to the future of your franchise which means sales. Creating both a strategy for sales and a set budget is critical. Begin by evaluating your target franchisees and markets. Next determine what will be a realistic budget for finding, training, and supporting those ideal candidates. Keep in mind that the success of your initial franchise locations will determine the future growth of your business. When budgeting, consider the costs associated with building an effective brand story.
All in all the process of how to start a franchise from start to finish can take around 100 days on average. Consider using a franchise consulting company in order to streamline these steps and advise on how to franchise in the best way for your business. Reach out to our team of franchising experts to get started today!
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