Ask yourself
1. Why do you
want to franchise?
If you franchise
well and
effectively, it’s a
good long term
strategy, rather
than a ‘get rich
quick’ scheme and,
as in any form of
expansion, there
needs to be some
investment in
developing the
current business as
a franchise.
2. Is your
business a proven
success?
It should be in
an established
format, with a
defined system, a
distinctive name and
appearance, and be
making money. You
need a minimum of 12
months trading
history (ideally
longer) to identify
any seasonality
issues, but also to
ensure that the
business model can
be sustained.
3. Can the
business be easily
duplicated?
Which means can
it be set up in a
sufficient number of
locations to create
a franchise network
of manageable and
profitable
proportions? Is
there a local market
need and would it
work in every area
or is what you do
specific to your own
local market?
4. Can someone
learn about the
business quickly and
easily?
Franchisees
will want to pick up
on the business in a
reasonable period of
time.
5. Does the
business create
sufficient
profits/margin to
satisfy both the
franchisor and the
franchisee?
The way franchisors
make their money is
from charging their
franchisees ongoing
fees, so there needs
to be enough money
in the business
model to be able to
do this.
6. Can you
adapt to a culture
of mutual support
and trust?
If you
franchise, you have
to recognise your
responsibilities to
assist your
franchisees to
create and operate
businesses using the
common brand and
system.
7. And, finally,
does the business
model have
attractive ‘reasons
to belong’?
Reasons that
would make someone
want to purchase a
franchise rather
than go off and set
up their own
business in the same
activity from
scratch?