What makes a business suitable for franchising?
To create a successful franchise, you should be starting with a healthy business that is performing well. You can get a steer on this by considering the key six criteria below
1.
Profitability.
Unit-level operations, whether they be fixed-location or mobile, need to be sufficiently profitable to provide a solid return on investment.
2.
Proven over time.
A business should have two or more years in operation, ideally more. Several outlets are an advantage – and prove adaptability. No franchisee or licensee should be a guinea pig.
3.
An appealing concept.
It helps to have an attractive business concept many others would like to operate.
4.
Intellectual property.
The business needs to own or access Intellectual Property (IP). Ideally, much of your IP will be unique and valuable – you might have exclusive products, brands, or systems. This provides your franchise with differentiation and competitive advantage.
5.
Initial capital.
Developing a proper franchising or licensing programme requires upfront capital. The amount depends on the situation.
6.
Leadership and management.
The right leader for a franchised business is a competent manager with a strong vision, the ability to delegate, a talent for relationship-building and a passion for sales and marketing. Strengths in planning and strategic thinking help, too.
Other areas which are important for a franchise business include strong customer satisfaction and emerging brand strength. Long term, growing a great franchise means committing to being a great franchisor. You’ll achieve the best results by prioritising your franchisees’ success.
Franchize Consultants can look at the franchising opportunities for your business in a free one-hour preliminary assessment. If you decide to proceed further, we’ll use a structured approach to produce a formal recommendation and work with you to develop the right kind of franchise for you.
Download the Franchise Advantage Guide
Get your free copy of the Franchise Advantage Guide – What you should know about starting a franchise system. Find out more about franchising and whether franchising is the right strategy for you with our guide. When you’re ready to take the next step, we’d love to help you understand the opportunities available for your business in a free one-hour preliminary assessment.
Ready to learn more?
We offer a free one-hour preliminary assessment meeting for anyone considering franchising their business. You’ll be able to get much more tailored and detailed information about your franchise opportunities.