We partner with franchise owners in countless industries, so we know a thing or two about how to successfully grow in that space. Today, we’re here to tell you all the secrets we’ve learned from our partners along the way that will set you up for success. Let’s dive in!
Steps for franchising a business
1. Identify your goals based on market research
One mistake a lot of people make is not taking the time to organize business goals in a realistic way. It can be tempting to just jump in feet-first and aim for the biggest, shiniest, brightest end goal, without identifying milestones along the way.
Take some time to identify:
• What is realistic for where you are right now
• What’s most important to you and your business
• Standard success markers in your industry
• What others have done to reach a level of success you want
Once you spend time identifying what those small wins look like to you, you’ll have an easier time piecing together what the big picture could look like.
2. Create a long-term business plan
Setting goals means nothing if you don’t have a plan to reach them. Mapping out a clear business plan will help keep you focused on how you want to expand your business long-term. Every conversation you have about next steps should keep your business plan in mind. If a goal or next-step doesn’t align with where you want to me, ax it.
3. Prepare your team
Leadership may be the final decision-makers, but it’s support from your team that’s going to get you further in the process. Be open about your goals and plans. Answer any questions team members have. Explain the “how” and “why” behind decisions you’re making. It can be scary for employees to hear the business is growing because they might have a hard time understanding where they fit in an expanded company structure.
Beyond just ease of mind, make sure you have the best business tools that will support your team so they can stay confident in their role.
4. Organize all legal and financial documents
This is the in-the-weeds stuff that loses a lot of people. Don’t be afraid of sifting through all the legal jargon that comes with franchising a company. The next chapter of your successful business is just on the other side of this!
Some of the legal documents needed to franchise a business:
• Franchise disclosure document: This includes items that require the disclosure of information about you, your franchise, etc.
• Franchise agreement: This is a legal document that clearly defines the relationship between the franchisee and franchisor.
• Operation Manual: As described, this manual explains to franchisees how you expect each franchise location to operate.
• Franchise Registration Applications: Different places have different franchise laws, so it’s important to understand how to legally apply for a franchise license in your service area.
• Financial Statements: Finally, you’ll need to be transparent about all the money your company is spending, bringing in, and how exactly it’s being used.
It’s in every franchisor’s best interest to consult with a franchise lawyer to understand the ins-and-outs of the legal requirements.
5. Partner with franchisees
Finding franchisees might seem easy since so many people find owning a franchise appealing. A business they can run without putting in all the legwork to build it from scratch? We don’t blame them! But just because a lot of people want to own a franchise, it doesn’t mean a lot of people are qualified to do some.
Some recommended sources to find good franchisees are:
• Trusted friends and family
• Franchise referral consultants
• Trade shows
• Online franchise directories
Take your time to thoroughly vet the people you’re trusting to franchise your business. It will be in your best interest in the long run!
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