Our Franchise Business Planning is the Blueprint for your business.
Before we embark on the Franchise Business Planning we first carry out an assessment of your business. Your consultant will study the business and its market to identify what is needed to realise its franchise potential. They will make suggestions for any modifications to the franchise business plan in order for a smooth transition to franchising. Learn more about Getting Started With Franchising.
The Development Plan – Franchise Business Planning
When analysing why franchisors fail, it is often not because their product or service was unappealing to customers or clients. It is simply because they chose the wrong approach to offer the franchise to the market.
Time needs to be taken to look closely at the financials and project. It is important to establish the revenue streams for you as a franchisor, as well as for your franchisees. There must be evidence of a worthwhile reward for you AND your franchisees – with a return on their investment of time, ability and money.
Sometimes referred to as the Franchise Feasibility Study or the Franchise Business Blueprint, this detailed plan outlines essential elements and strategies for establishing, developing and managing the franchise.
What is included:
- Financial forecasting for both franchisees and franchisor
- An analysis of the potential of your business for franchising in terms of demand, competition and differentiation from others
- Determining and outlining initial and ongoing fees
- Projecting franchisee return on investment
- Assessing internal business resources in terms of skills, time, and finance
- The overall franchise model and how it will look
The plan considers aspects such as the business model, operational procedures, training programs, marketing strategies, support systems, legal documentation, and financial considerations. It serves as a roadmap to guide you in setting up and running the franchise effectively.
It also answers the question ‘Should I Franchise My Business?’ (Not all businesses go on to actually franchise their business after completing this stage. Either the findings could be that they are not yet ready, or that franchising their business just isn’t viable. This may seem like a negative thing, but it certainly isn’t. If a business is not yet ready to franchise, they will be told why, and what they can do to make it ready (at no extra cost). If a business is just not viable to franchise, then the report will have saved them time and money!)
Once you have settled on the format of your franchise business, it should be possible to map out the franchise development growth strategy and engage professional advisors. Therefore ensuring that you keep heading in the right direction in attending to all the detail that will need to be considered, and developed, before launching.
The Risks of Franchising
There are risks in expanding any business and in franchising; your responsibility is to create a win-win strategy so that both you and the franchisees succeed.
Moreover, creating a franchise offer is entirely different from normal trading activity in relation to your original business. You are about to embark on running a completely new business, focusing on helping others to succeed. That means using your model, with your support, training and ongoing development. It is very much a people and organisational centred operation. For that reason, we do advise that you take professional advice at the outset. We find that companies frequently underestimate exactly what will be involved in creating and developing a successful franchise. Creating a franchise offer is entirely different from normal trading activity in relation to your original business.
There is no substitute for real experience – hence the phrase ‘fail to plan’ then ‘plan to fail’ is often proven accurate!
Franchise FAQS
How Much Should I Charge Franchisees?
Determining how much to charge franchisees involves considering various fees that cover the resources and infrastructure needed to support a franchise network. Common franchise fees include an initial franchise fee, Management Service Fees (MSF), marketing fees, and potentially other fees like technology or renewal fees. The initial franchise fee is a one-time payment for the rights to use the brand and operating systems, while MSF are ongoing charges based on sales revenue for continuous support. Marketing fees contribute to national or regional marketing efforts managed by the franchisor. When setting fees, conduct a detailed analysis of business and operational costs and benchmark against industry standards to ensure competitiveness. Clearly explain the value and support provided in return for these fees to potential franchisees.
What Franchise Support Do I Need to Provide to Potential Franchisees?
In essence, franchisor support safeguards smooth operations. Support should include training programmes, operational support, premises selection, design & fit out, marketing & promotions, technology, financial guidance & reviews, quality control, supply chain management, R&D, new innovations, new products or services, audits & standards compliance. Supporting franchisees creates a collaborative culture, so maintaining open & regular communications is a key aspect of support. For example, regular meetings with franchisees, recognition & awards events, and conferences are important in creating successful franchise networks. Supporting & empowering franchisees to succeed is an essential element of franchisors responsibilities, and creates a motivated, profitable network that will attract new franchisees to the brand.
How Can I Protect My Business Ideas When Franchising?
To protect your business ideas when franchising, implement several key strategies. Use robust legal agreements like Franchise Agreements and NDAs to safeguard your intellectual property and confidential information. Register trademarks, patents, and copyrights to legally protect your brand, products, and materials. Create detailed training and operational manuals, limiting access to sensitive information. Monitor franchisee compliance through regular audits, meetings, and possibly mystery shoppers, and appoint a franchise manager when possible. Carefully screen and train franchisees to ensure they uphold your brand standards. Finally, gather customer service feedback to identify areas needing improvement and take legal action against any franchisees who violate agreements to protect your brand reputation.
We Can Help You
To find out how Ashtons Franchise Consulting can help you transform your business into an established national franchise with a Franchise Development Business Plan, call 0330 016 0028, email enquiry@ashtonsfranchise.com or complete our online enquiry form.