“Can My Business Be A Franchise?”
A list of successful franchises shows a wide variety of restaurants, companies, shops and stores. Naturally, fast food servicers are always near the top. But, when considering what type of business can be franchised, there are computer gaming stores, postal services, painting contractors, dog-sitting services and a host of other businesses that most experts of thirty years ago would never have envisioned as franchises. But these days it is difficult to think of a type of successful food or other service business that would be difficult to franchise. Below is a cartoon from the June 30, 2003 issue of Barron’s. The neighbor walking down the street has just said “Hello” to Jimmy:
“Actually, my name is Bobby. ‘Jimmy’s Lemonade’ is an international franchise.”
The answer to the opening question is: “If you are running a successful food or other service business, and you have something you can teach to others, so that they can run a similar, successful business, it is likely to be franchisable.
Should I Franchise My Business?
Huge numbers of companies have answered affirmatively to the question “Should I Franchise My Business?” Thousands have done so with great success. However, there are also a large number who have failed due to a combination of factors that should have been considered. This means a lot of disappointed entrepreneurs who are now asking “Why Did I Franchise My Business?” or “Why Didn’t I Get the Right Consultant and Attorney?” If you are the owner of a successful restaurant, business, company, shop, or store you should drill down into these questions a little deeper, and perhaps start by asking yourself: (1) Why you should consider franchising at all; (2) Are you capable of operating a full-fledged franchise system?; and finally, (3) Whether your business is franchisable (capable of being franchised).
Why Should I Consider Franchising?
The economic incentives to franchise your business are simple to understand.
- Would you like to use all of your savings, or go into tremendous debt, in order to open a branch office, restaurant or store?
- Or, would you rather find someone willing to supply all of the costs of opening another business just like yours – – and be willing to share some of those profits with you?
- Would you like to go through an extensive interview process to find a hard-working, honest manager for each new facility you open?
- Or, would you rather search for another entrepreneur much like yourself who will have a stake in the new business and the incentive to succeed?
- Would you like to be responsible for all of the employee problems and operating costs inherent in running each new location?
- Me neither.
Can My Business Be a Franchise?
Think back to when you started your business. You found a line of work that gave you enjoyment and you believed that if you worked hard enough it would achieve your desired result. Along the way you fought many battles and developed a few economic scars. But you persevered and you overcame the inevitable obstacles to get where you are today. You now know enough about leasing a facility, remodeling and equipping, employing personnel and operating your business, that you could probably write a book.
Is All of this Operating Experience Transferrable to others?
Well, you probably already have the content of that book among your lists of equipment, furnishings, products, customer service requirements, employee conduct rules, financial recordkeeping procedures, and a dozen other items – – – that could all be compiled and translated into a Franchisee Operations Manual. (If all of this is only in your head, then you might want to get busy writing in case you eventually sell, or to help your son or daughter if they are to continue your business).
A successful business, with a fully refined operational plan to teach others how to run the business, refined and proven operating and quality standards and procedures that you are willing to enforce in your franchised locations, and a quality name which you have developed and which you desire to be a standard of growth — fairly well takes care of what you need to be able to successfully franchise your business?
Am I Franchisable?
However, upon deciding that franchising your business is worth considering, you need to turn your attention to the business itself, and first, to yourself.
It is a foregone conclusion that you would not be wanting to franchise your business unless it has proven to be successful and profitable and that you want to open additional locations to increase your market share and earn even greater profits. This means that you have been bitten by the “entrepreneur bug,” and it says a lot about your ability and desire to work hard in order to achieve that future success.
There is one other factor that we at The Franchise Company consider as important as any other. Ask yourself this question concerning your motivation for growth. As part of this motivation, are you thinking that you would you get a lot of satisfaction from seeing others achieve your level of success? Can you visualize yourself sitting at your desk, looking out the window with a smile on your face, because you are thinking of a large number of franchised individuals and families that you have helped? In my 40 years of experience, this is the factor that most determines success in franchising.
However, it is not enough that your business is successful and you are capable of running a multiunit operation (especially with a little help from us). You need to find out whether the “baby” you created can also grow elsewhere.
The Franchise Company
The final ingredient you require is an experienced franchising consulting firm that will show you how to put all of this together into a workable franchise system, and that will provide a qualified franchise attorney with the knowledge and ability to properly produce your required documentation.