Has the thought of franchising your successful business been on your mind? Many business owners dream of one day turning their idea into a legacy household name. This idea is not only just for a business owner’s sense of glory, but also the dream of selling their successful business at a considerable profit, or better yet, franchise the successful transaction for an ongoing residual income.
Expanding your business by way of franchising is a great way to grow your business with the investment of others, but there is much to be done before you can reach that step. As a business owner, being your own boss is great, but converting your company into a franchise is a different level of complexity. If you’re ready to take on that next challenge, here are some steps to get you started on the right foot to turn your company into a franchise.
1. Organize and evaluate your business concept and model
Up until now, your business model has been one business. Can it stand on its own right now as it is to become a franchise, or is there some modifications necessary to get it there?
What would make your franchise stand out amongst the competition? If what you offer is similar to others, what is your secret to success? Do you have a unique selling point (USP)? This USP is a demonstrated success with refined processes and an established and well-known brand name. Is there something unique that the competition doesn’t provide? It would help if you had a hook to compel a potential franchisee to buy your franchise instead of starting a business themselves, from scratch.
2. Seek advice from industry experts
You know your business like the back of your hand, but franchising is a different can of worms. You want to consult some experts on the topic and ask for assistance. Speak to a lawyer and a franchise consultant to lay out a plan for executing your franchise. Expect and be prepared to invest some additional capital to get things started. Some of those details are:
- Franchise fees, royalties, and franchise agreement terms
- The training you’ll provide to franchisees and what knowledge you expect of them coming in
- How you plan to help with marketing details
3. Preparing for change
As a franchisor, your job as managing your single business is about to expand, for you are about to promote yourself into supporting and selling franchises. It’s time to negotiate with yourself where you will delegate some responsibility to someone you can trust to keep things humming along in your business operations so you can step back.
4. Be selective with franchisees
Having the capital to buy into the franchise isn’t all it takes to represent what you took years to build, so don’t just sell to anyone with a checkbook and a pen. You want someone who believes in your business model and trusts your processes. They should be passionate about the industry and motivated to expanding the business. You may find you have some fabulous potential franchisees already working for you. They have proven their loyalty, and you know their ethic. They can be some of your first and best franchisees when you’re ready to grow into a franchise.
5. Supporting your franchisees
Becoming a franchisor is a new job description for the business you’ve built, so your work never stops after you sold a franchise. From that point, you become a mentor and trainer to support your new franchisee to succeed. It’s in your best interest for your franchises thrive, for they create residual income for you and continue developing your brand reputation.
Turning your small business into an empire by franchising can be a rewarding progression, and given the appropriate amount of time and preparation, your business can become a household name beyond your hometown. What business owner doesn’t dream about that once or twice?
A franchise consultant can help you find those franchisees
Hundred Acre Consulting helps franchisee candidates match up with their ideal franchise opportunities, then walks them through the steps to franchise ownership. How can we help? Contact us, and let’s talk!