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Should I Franchise or Not?

Posted in Franchises by admin on January 6th, 2009
Tip! ) Franchise Organizations and Companies use a common Confidential Operations Manual; The Catholic Church uses a similar bible.

A reader of one of my online sessions asked should he franchise his business or not. He had set up a service business and was getting ready to expand and wanted to know if franchising was a good potential strategy for this. How do I franchise my business? There are many criteria for franchising and if you have ever thought you might wish to franchise your business then this advice could be of value to you:

Tip! ) Franchises often have recognized brand names, which consumers feel safer with.

You cannot determine if you should franchise or not until you have perfected your operation, any thing less than perfection will be doing a disservice to your future company and franchisees. I am not advocating waiting until it is actually perfect, for that day may not ever come, but rather making that a goal of your business building before deciding to franchise or not. Go read the “E-Myth.”

It is possible you might be pre-empted as your profits will be taken by attorneys and lawyers due to the increased regulations in franchising. We have issues in the US where workforce is often under the impression of the right to be irresponsible and if they do not work hard and fail they will most likely blame you and sue. So many factors to consider and many are not in any books. I would say; you need to start with about a million dollars solely dedicated to the franchise part of the business to get it to work. Not including all the prototypes or company owned stores or operations.

Tip! Narrow the Search: Based on the personal needs analysis, select no more than three franchises that potentially will meet those needs.

There is an overload of information on this topic, but anyone truly interested in franchising needs to study up on these methods. If you can; I recommend some good books or articles on this subject you might wish to read:

The Franchise Bible

Trips and Traps When Buying a Franchise

Franchising 101

Franchising for Dummies

Franchising and Licensing

I have read and own probably 30 books on the subject all have tid bits but these ought to be a good start. If this it not sufficient, a longer list can be made available from www.franchising.org . Remember most people write books for a reason; if it is written by an attorney it will have legal slant, an entrepreneur will have an optimistic and promotional slant, a consultant will have a strategic slant. You see? The book most important in my professional opinion after you have franchised would be; “The Franchise Relationship” www.franchiserelations.com .

Tip! Multi-unit Ownership The proof is in the pudding. The best indication that a franchisee is happy with his business is if he spends more money to purchase another unit or an additional territory.

If you are considering the franchise format to expand your currently successful business then these are aspect and information you should be well versed in to make it all work. I wish you the best of luck and continued success.

Lance Winslow

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