When you’ve rounded the learning curve in business, meaning you know your concept works, – you may be tempted to franchise to grow and scale. In fact, it’s what I’ve done with my 41-year-old business and I couldn’t be happier with the decision. It’s been a long and involved process, full of lessons and growth. If you’re thinking of franchising your business, you’ll definitely want to follow these three steps:
1. Form a committee.
When a candidate runs for office, an exploratory committee is a common first step. Good move. Create an exploratory committee of your inner circle of trusted family, advisors, colleagues and friends. Hear their ideas and gauge their support as you move forward.
Develop your pros and cons list and do your research. Examine everything. Do your own and delegate research to your committee. Give them specific industry issues to report on:
- typical profits;
- potential shortfalls;
Bring as many trusted brains to the table as possible.
2. Ask – and answer – the hard questions.
Most visionaries see greatness in their companies and have an overwhelming desire to bring it to as many cities as possible. Your beautiful entrepreneurial spirit serves as a driving force – but it can’t be the only reason you franchise.
Honestly answer these questions:
- Can I afford this? Franchising your business requires a sizable financial investment. While the returns can be promising, it also takes another nest egg to launch and market the brand once you’re done ramping up.
- Is my current business firing on all cylinders? If your current business could stand to be tightened up, don’t even consider franchising until you’re rock solid. Don’t get me wrong – no business is ever finished improving – but if you don’t already have comprehensive systems and measures in place to ensure consistency, you aren’t ready to franchise.
- What does success look like? Clearly describe, with exceptional detail, what your franchise is and does and why people will want to buy into you and your company. The more detail, the better.
More questions: Am I willing to surrender or share control of my brand to franchisees? Am I okay with traveling and being gone frequently from my family? Is this the best strategy for my business? Once you’ve thoroughly addressed these questions, if you decide you’re ready to move forward into franchising, be sure to follow this critical step:
3. Choose your team wisely.
Once you start putting feelers out that you’re interested in franchising, you’ll get inundated with companies promising they can do it the best, fastest and give you the highest rate of leads and sales. Be sure you know exactly what you’re agreeing to and partner with a team you trust and respect. Do your homework, check references. Franchising is a complex regulatory, legal, intellectual property and systems development process and you’ll want to be with a proven company that takes the time to understand your goals and brand.
Next Steps: You’re busy. We get it. So why not let us do some work for you? By signing up for the weekly Small Biz Ahead Newsletter, you’ll receive hand-picked articles, How-Tos and videos covering the latest in small biz tools and trends. We’ll do the research while you spend your time where it counts: managing and growing your business.