Unique, Proven, Repeatable
Because, who wouldn’t want to own a franchise system? It is a great way to grow your brand, get your ideas out there to more people, and leave behind a legacy for future generations. Not to mention, with franchisees buying into and growing your brand, you can expand to a national or even global market with considerably less capital.
You may be saying to yourself, “Sounds great! Where do I start?” Well before getting started or going any further, take some time to examine your business for franchise-ability.
Is your business a unique concept?
According to franchise expert John Batcheller, “Going head-to-head in a saturated market is difficult and costly. Emerging franchise brands with clear points of differentiation increases the opportunity of success.” You need to have a clear idea of who you will be going up against. If your competitors are on every corner in every town, what is going to set you apart? What is your niche? Knowing your niche allows you to focus your time and energy, to know your competition, determine what you can charge for your product and what kind of profits you can expect. Identifying and embracing your niche market is key to success in any business, and when it comes to franchising it is paramount. Identify Your Competitors to have a clear idea of who you will be up against.
Can you create a mirror image of your business in various cities and towns across the nation?
To build brand loyalty, you need consistent product. To be consistent, you need to have repeatable processes in place. Baristas at a Starbucks in Texas can make you a drink that tastes exactly like the one you had in Seattle last week. The success of Starbucks depends on this consistency. Understand Your Operational Processes and tweak them if necessary. Once processes are in place, examine if your business will do well in other areas across the nation. Some businesses depend on the local environment, like a river rafting business. Others depend on the specific demographics such as tourism, while yet others depend on the charm and pizzazz of a certain individual working at or running the location. There also may be local constraints that can affect your ability to expand outside of your territory. For instance, if you are thinking of franchising a store selling fireworks, you need to consider the various laws from state to state and even county to county.
Do you have a proven success record?
If your concept is unique and repeatable, is it also profitable? Potential franchisees will be looking for a proven concept. Low profit margins will scare investors off from the get go. If you have consistently increased revenues year upon year you will catch the attention of savvy business people. If margins are low, learn How to Increase Profit Margins to make your business more desirable to potential investors down the road. In addition to numbers, investors will be checking your reviews. Are customers raving about your product, or is there something left to be desired? If people have asked you if you are a franchise or if they can buy into your business, it is a good sign that your business may be ripe for expansion through the franchise business model.
So, you want to franchise your business? That’s great. Make sure you have a unique and proven concept that is repeatable, and let’s talk.