Could You Franchise?

Could you franchise your business? Consider if your business exhibits the foundation stones to form the basis of a successful franchise.

Watch our managing consultant Nick Williams discuss the specific factors that a business needs in order for it to be franchised:

If your business possesses the following factors it has the potential to be successfully franchised:

Historical Trading Performance

Franchising is about replicating a financial model that has already been achieved, so it is imperative that there be sufficient trading to give realism to any financial projections.

A Proven System

Good franchising requires the franchisor to have gone through the learning curve, identified the pitfalls and found appropriate solutions. Then the franchisee can then be shown a business model that works. The franchisee should be replicating a tried and tested business system, rather than experimenting with new ideas.

Branding

Strong branding is fundamental. People want to invest with a sense of pride, in a business that portrays a strong corporate identity and has a brand suitable for national or international recognition. If the trade name has been formulated around a local region and is unsuitable to travel nationally, it is best to formulate a new brand before franchising is undertaken. The brand should be simple and shout out the message of clarity, professionalism and quality.

Corporate Image

A business’s corporate image is showcased through various elements. These include external signage, a protected brand, name, corporate colours, vehicle livery, corporate dress, website design, promotional material, own-label products and stationery. To strengthen your corporate image, ensure consistency across all these areas. Developing a cohesive and strong corporate image throughout every aspect of your business is essential for building a recognisable and trustworthy brand.

Replicable

The basic business process must be teachable within a reasonable period of time. If your model requires special skills then the field of potential franchisees may be reduced. Bear in mind, however, that many franchisees are business people with suitable skills to run a business. They would, in turn, employ staff who already have any necessary technical skills.

Professionalism

Professionalism is manifested in how the telephone is answered, the quality of service provided, the clarity of written communication, the attention given to detail, a clear code of values and evidence of satisfied clients. Franchisees will be attracted by a professional approach to recruitment that involves the right body language and the approach to the franchisee at every level. That which portrays a lack of true professionalism can be a ‘switch off’ to the right people.

Products and Services with Good Staying Power

Franchisees do not wish to make a long-term investment in a business that has a product or service which may be fashionable or become obsolete over time. Discerning prospective franchisees will be looking for product and service deliverables that are required through varied economic conditions.

Sufficient Profit Margin

Franchising is not suited to marginally profitable low turnover businesses. There must be sufficient operating margin to sustain continued business growth and development, while also enabling both the franchisor and the franchisee to enjoy a reasonable return. The franchisor must receive a profit margin sufficient to provide good back-up and support and maintain a healthy research and development programme. The franchisee must have sufficient margin to build a rewarding business. A win-win situation must be provided, that enables the franchisee and the franchisor to succeed together.

Management Attitude

The attitude of management towards franchising is key to success in franchising. Franchisees are not employees; they are self-employed business owners who must be treated as equals. While the franchisor needs to lead with authority, franchisees should be given the opportunity to have their ideas heard. The franchisor’s objective is to build a successful business through the successful development of its franchisees.

A People Business

A franchisor is running a separate business enabling others to succeed using their business blueprint. Communication skills are important as is an ability to encourage and support others.

Franchise FAQS

How do I know if my business is franchisable?

To determine if your business is franchisable, ask yourself why someone would choose to buy your franchise instead of starting a similar business independently. You need to clearly define what makes your business unique and difficult to replicate. Key factors to consider include having a proven, profitable business model that can be successfully replicated in various locations, a unique selling proposition that differentiates you from competitors, and well-documented operational systems. Additionally, a strong brand presence, solid financial performance, scalability, and comprehensive support systems are crucial elements that attract potential franchisees and ensure consistent quality across franchises.
For a more detailed answer to this question visit our dedicated Franchise FAQs page.

How long will it take to franchise my business?

The time required to franchise your business can vary greatly, similar to starting a new business. It depends on the resources available and the complexity of the setup. Initially, you will need 2 to 3 months, possibly up to a year, to assess franchisability, develop a franchise plan, and create necessary documents. Legal documentation, including the Franchise Agreement, can take another 2 to 3 months. Developing the Operations Manual and preparing for marketing and launch may add another 3 to 6 months. Overall, the entire process can range from 3-4 months to over a year, depending on the business’s readiness and the level of external support.
Visit our Franchise FAQs page to learn more about how long it can take to franchise a business.

How much will it cost to franchise my business?

The cost of franchising your business varies based on factors. For example: how quickly you want to expand your franchise network, the level of professional advice you need, and the expertise and time you and your team can invest in the process. For instance, hiring a franchise consultant to assess your business and evaluate franchise feasibility typically costs around £2,950 with Ashtons Franchise Consulting. Developing a Franchise Development Programme, which includes essential documentation, marketing strategies, and recruitment processes, can range from £5,000 to £16,500. You should also budget for legal fees to draft Franchise Agreements, which usually cost about £6,000, and trademark registration starting at £500. Additionally, ongoing expenses such as training, support, marketing, and management systems are crucial, so consulting with professionals will help ensure a successful franchise launch.
Click through for a thorough explanation of franchising costs.

What will a franchise development consultant do for me?

A proficient franchise development consultant helps business owners create a bespoke and attractive franchise model. They conduct feasibility studies and develop a comprehensive strategy and financial plan. They build ethical franchise opportunities and teach franchising principles. Additionally, they create essential documentation and provide ongoing mentorship and advice. An experienced consultant helps clients avoid costly mistakes and prepares them to offer franchisees a genuine opportunity. This fosters a professional and profitable relationship with the franchise network.
Learn more about franchise consultants and how they can help you.