how can a successful business be franchised

^{6 Steps to Franchising Your Business}

1. Know your business inside and out. The directions provided to each franchisee will likely have to be precise. ...
2. Learn about the legal issues. Mulgannon advises all business owners looking to get into the franchise business to pay close attention to Item 19 on their FDD filing. ...
3. Know how you want to grow. The idea of growth is appealing, but a small business owner wants his or her company to scale at a reasonable rate. ...
4. Screen your franchisees. That someone wants to open a franchise with your company's name on it does not mean you should let them. ...
Set the right restrictions. Even after giving franchisees very specific instructions on hiring, training, and other practices, there will be, and should be, certain freedoms they are allowed. ...
Support your franchisees.

How can I start my own franchise business?

When preparing for your big day, a few tips can help make it a success:

• Choose a date with high traffic. Your opening date and time should be ideal for attracting as many people as possible.
• Advertise to your local market. ...
• Send press releases to local media outlets. ...
• Invite friends, family and city officials. ...
• Decorate the store with grand opening paraphernalia. ...
• Organize exciting activities on opening day. ...

How to run a successful franchise business?

• Choose the right franchise. Franchisees whose skills and interests are a good fit for the business are usually more successful than those purely tempted by the financial opportunity.
• Follow the franchise system. ...
• Have a business plan. ...
• Take advantage of franchisor support. ...
• Be friendly with your franchisor. ...
• Have sufficient funding. ...

How to successfully franchise your business?

• Present Your Business to Potential Franchisees. After identifying your goals, you may now sell your franchise business model to your prospective franchisees.
• Provide Hands-On Training. If you have a vision for your franchise business, your franchisees must share the same objectives with you.
• Work On the Ground. ...
• Implement The Organizational Culture. ...

What do you need to know about starting a franchise?

Starting a Franchise. At its heart, starting a franchise is all about licensing. In the franchise business world and using franchise business models, business owners, known as the franchisees, purchase a license to use any trademarked logos, names, and business structures or formats or systems of the franchise owner, all known as a franchisor.. Franchise expert, Joel Libava, offers his ...

What is the success of a business?

How to treat your employees?

When to alert franchisor?

Is franchising training continuous?

Can a franchisee change their business?

See 2 more

About this website

What makes a successful franchise business?

Brand recognition and consistency are key elements to a successful franchise. Customers build trust and loyalty as they interact with the franchise, making it more likely they become repeat customers.

How can you make your business a franchise?

How to Franchise a BusinessMake sure your business is ready to franchise.Protect your business's intellectual property.Prepare a financial disclosure document (FDD)Draft a franchise agreement.Compile an operational manual for franchisees.File or register your FDD.Set a strategy to achieve your sales goals.

How successful is franchising?

It's known as "The Stat"--the notion that franchises have a success rate of 90 to 95 percent--and it has helped fuel franchise fever for decades.

What are advantages of franchising?

Advantages of buying a franchise You don't necessarily need business experience to run a franchise. Franchisors usually provide the training you need to operate their business model. Franchises have a higher rate of success than start-up businesses. You may find it easier to secure finance for a franchise.

When can you franchise a business?

As a general rule, it's recommended that businesses have at least one to three years of successful operations before franchising. That number could be higher or lower, however, depending on the industry. For some businesses, franchising during the first two years of operations can be advantageous.

What's the most successful franchise?

The 25 Highest-Grossing Media Franchises of All TimePokémon – $92.121 billion.Hello Kitty – $80.026 billion.Winnie the Pooh – $75.034 billion.Mickey Mouse & Friends – $70.587 billion.Star Wars – $65.631 billion.Anpanman – $60.285 billion.Disney Princess – $45.187 billion.Mario – $36.143 billion.More items...

Why do franchises have a high success rate?

Franchises are supported by a proven system. It might seem obvious, but many entrepreneurs try to do things their own way—which means it can take twice as long to get going, or the chance of failure can dramatically increase when you buy a franchise.

How many franchises are successful?

A Google search may lead to an evenly balanced sermon on the pros and cons of franchise ownership. Or you may land on this gem from About.com: "Some studies show that franchises have a success rate of approximately 90 percent as compared to only about 15 percent for businesses that are started from the ground up.

How do I know if my business is ready for a franchise?

You will be successful at franchising if your products and services have popular appeal and demand. Once your offerings gain significant market traction, then you will be able to license franchises on your terms - it saves them time, energy, and money.

What does it cost to start a franchise?

Franchise startup costs can be as low as $10,000 or as high as $5 million, with the majority falling somewhere between $100,000 and $300,000. The price all depends on the industry, location and type of franchise.

What is an example of a franchise business?

Examples of well-known franchise business models include McDonald's (NYSE: MCD), Subway, United Parcel Service (NYSE: UPS), and H&R Block (NYSE: HRB).

How could you start a business and then later make it into your own franchising?

More videos on YouTubeAsk yourself: Are you ready? Assess if your current business is ready for expansion. ... Update your business plan. Revise your business plan to include your franchising business plan. ... Find a mentor. ... Prepare your legal documents. ... Strengthen your brand. ... Promote your franchise. ... Choose well.

5 Things That Make A Franchise Successful - Forbes

What makes the difference? Five factors: 1.The Right Business Model—the way the chain enhances customer value vis-à-vis the competition. Franchise pioneer McDonald’s, for instance, delivers ...

What are the traits of a franchise?

The new world order doesn’t change the basic ingredients of such a relationship: service, reliability, sociability and trust for the sake of a happy customer.

What is franchising in business?

Franchising is a way of business by which an established brand can extend its reach. This is done by franchising to others who will be perceived as associated with the brand and sell the products or services as if they were the actual established brand. The association involves a business arrangement in which the franchisee pays for ...

What are the benefits of franchising?

Benefits to the franchisor in business format franchising can include more sales and geographic extension of the brand, and the company standards are maintained for consistency in the public eye. Benefits to the franchisee include a turn-key operation with support, design and supplies provided to establish an up-and-running business .

What is traditional franchising?

Traditional Franchising. In this type, the franchisor licenses its trademark and logo but doesn’t supply the set-up for the franchisee’s actual business to run. The franchise is associated with the original brand, often selling products made by the franchisor. For example, beverage and car manufacturers often are set up in this way.

What does a franchisee pay for?

The franchisee pays a royalty, initial fee or both to operate under the particular name and use the brand's methods. As the founder of a private surgical center franchise, I've learned what it takes to build a successful franchise. Let's look at two basic types of entrepreneurial franchises: traditional franchising and business format franchising.

Is a franchisee obligated to operate on a system established by the franchisor?

As such, the franchisee is obligated to operate on a system established by the franchisor; the business must be run a certain way, lest the franchisee risks a breach of contract. The franchisor’s standards are maintained while the franchisee personally manages the day-to-day business activities. Benefits to the franchisor in business format ...

What to do if people don't know your business exists?

7. Focus On Customer Retention.

How to get word out about your business?

You'll want to use your marketing budget to get the word out about your business in every way you can, from social media advertising to direct mailers and billboards . You may have the best-run franchise in the world, but if people don't know your business exists, and especially if you don't have a brand name that the world recognizes (such as McDonald's or Burger King), they won't pay you a visit.

What is Forbes Los Angeles?

Forbes Los Angeles Business Council is the foremost growth and networking organization for business owners in Greater Los Angeles. Do I qualify?

Can you cut corners in a franchise?

You can't cut corners in any franchise or in any industry. Even getting the little things right, like finding a consistently friendly receptionist, is very important. Customer reviews on Yelp and other social media sites can make or break a business.

Can you be successful if you buy a franchise?

But obviously, just because you buy a franchise doesn't mean you'll be successful.

Do business owners want to franchise?

Many business owners want to run a franchise, and for good reason. You have your own business, but you're also buying a business system — one that you know works. Instead of starting a business that could bomb in a few months or years, you're buying a business that has worked elsewhere and presumably will work in your community.

Is franchising hard?

We all know that franchising is hard, and it's important to do your due diligence and so on. But still, you don't know what you don't know. Your community may not have enough people that fit the target demographic to support whatever franchise you're interested in. Or maybe there are too many restaurants or automobile service garages or whatever you're thinking of buying.

What makes a franchise a good franchise?

What makes a good franchise is an agile yet strong and supportive infrastructure. All franchisees need initial training when they start. Even if they have experience, they’ll still need to learn the ropes of your operating model. Providing ongoing training ensures standards are maintained and benchmarks are met.

What makes a successful franchise owner?

A successful franchise owner has an entrepreneurial spirit, the patience to invest time and energy before reaping the rewards, and the agility to adapt as their franchise grows. More than offering a brand and operational business model, a great franchisor should assist franchisees with location selection, financial advice, marketing, and management.

How does a franchise grow?

Just as a business becomes successful by hiring the most talented employees, so too can a franchise grow by rubbing shoulders with others in the field and learning from their experience.

How to grow your franchise?

To grow your franchise, you need to ensure your franchisees are properly trained and implement feedback mechanisms for customers to rate your service. Without constructive feedback, you won’t have the necessary insights to know where or how to improve. Good customer service leaves a lasting impression and encourages people to return.

Why is customer retention cheaper than acquisition?

Customer retention is generally cheaper than acquisition because returning customers are likely to spend more on your product or service. Happy customers recommend others and are more likely to remain loyal.

How to attract new franchisees?

You will also need to invest further capital into a franchise sales website, branding, franchise sales presentations, paid advertising and joining relevant broker organizations to attract new franchisees. Hiring a professional digital marketing agency can alleviate the admin but will cost an additional fee, that while worthwhile, still needs to be budgeted for.

Why is it important to hire people?

They are responsible for how you operate, how your business presents itself to customers or clients, and ultimately, how successful you are — this goes for your business team and prospective franchisees. Striking a balance between job role competency and company culture when hiring is important, too; there’s no point in employing a competent hire who doesn’t mesh with your company’s values and ethos.

Why do people franchise?

You may be thinking of franchising is a way for you to make money because your current business is NOT making money (more on the topic of franchising to increase your sales). Or perhaps a way for you to get more customers for your own business. The idea behind franchising is to roll out a program that when followed, will generate success, not failure, for someone else to operate. Think about it…if you are struggling to keep your own business afloat how can you teach someone else to be successful? Franchising is not about bringing on other people simply to collect money or to test out what works. Our advice: Grow your business and make it work for yourself before even thinking about expansion.

Is a hobby business considered a business?

Your business is considered a “hobby business” if it is something you do part-time while working full-time, is not treated seriously enough to replace your income and is done mostly for fun (to make some cash on the side). For example perhaps you make jewelry and sell it at farmers markets or festivals either on the weekends or sporadically throughout the year. Our advice: turn it into a real business, not just something done when you feel like making a little extra cash.

Can a business be franchised?

It’s likely that many of them are franchises! Technically speaking, any type of business can be franchised (read about the different types of businesses we have franchised). However it is important to assess what your business really has to offer and will continue to offer someone if you are exploring the idea of franchising as part of your end game.

Can you franchise if you have a hard time?

The business model that you created may lend itself to franchising, but if perhaps you have a hard time training other people or are afraid of teaching someone you methods and processes. This can be a problem. If you believe you have to do everything yourself (because no one else can do it the way you do) this is the type of “control freak” characteristic that does not lend well to franchising (read how being a bit of a control freak can be beneficial when franchising). Franchising is about maintaining some control for consistency purposes but also being able to let go of day-to-day operations and teaching someone else how to operate your business. Our advice: If you are looking to expand and want control over all day-to-day operations, then you are better off opening more locations yourself.

What is the success of a business?

The success of any business is linked to the level of enthusiasm you bring to the job.

How to treat your employees?

Treat your employees with respect. Don't allow employees to be disrespectful to any other employee.

When to alert franchisor?

Alert your franchisor when you need additional training.

Is franchising training continuous?

In franchising, training should be continuous. Employees are you front line.

Can a franchisee change their business?

Franchisees often get their business up and running and then begin to change , add or modify existing products, advertising, hours, services, and even the quality and consistency they are licensed to deliver. This violates the franchise agreement and puts you in jeopardy of having your franchise terminated!