Your business has been doing extremely well for the past number of years, and you are starting to think whether it is the right time to franchise your business. While franchising has the potential to expand your business and increase the bottom line, you also have to consider the possible consequences that franchising will bring to the business model. Here are the main factors to consider when deciding to franchise your business.
As a brand, there is a standard that you have set out there in the market. The standard is determined by the quality of the goods or services that you offer or your quality of after-sales services, it’s determined by your brand and what you’re brand is known for, what customers think of you in customer reviews and so on. When you are thinking about franchising, note that the consumer will probably not know that the store which has popped up near them is a franchise, they will hold the store to the same standard and expectation that they do to the main brand. You, therefore, need to clearly state these standards to the franchisees and make sure they have the capacity to meet them. Inconsistency in one location can hurt brand loyalty across the whole business.
When you decide to scale your company, you are also deciding to let go of some of the control and ceding it to whoever will be managing the new stores. It is not easy to allow someone else to be in the position to make decisions for a business that you have molded since inception. When picking a team to manage these changes, you need to make sure that they share your passion for business growth and success. If you are in real estate, for instance, talk to the team you are putting together to get insight into the benefits they have experienced in real estate investment. The attitude your team has will determine the possibility of your business succeeding. Make sure they have a good idea of what’s expected of them. You should also look at other companies and see how their growth progressed, noting what things they did well, and what mistakes they made along the way. This can be easy in the real estate market because of the rise in programming like Love it or List it, Property Brothers, and so on. You can track those companies attached to the shows like Rules of Renovation for Love it or List it, The Scott Brothers brand for Property Brothers, before and after and their general rise and fall.
When you decide to franchise, a fundamental change will happen to your business model. You will suddenly shift focus from dealing with a direct consumer to dealing with other businesses and managing them so that they can manage the people who were your consumers better. The shift from being B2C to B2B can be daunting. Prepare to be challenged, but when you take it in stride, success will follow.
These are the considerations to have in mind before you put together the necessary documents for the franchising process. Make sure you are playing by the rules which includes having the Franchise Disclosure Document filled out. It is all part of the process. Note that by the end of the day, the most important thing is performing your due diligence and being patient.
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