Getting a business off the ground in the first place can take many years of hard graft as well as some degree of luck. The next step of expanding your business can be even more challenging, particularly if you don’t have the right level of capital behind you.
The good news is that putting your business out to franchise has the potential to take you to the next level.
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The Lower Cost
Finding new premises, researching the best location and getting the infrastructure and staff in place all have their cost implications. With a franchise, you are asking the franchisee to take at least some of this burden. That means you can start to grow at a much lower cost than if you were financing it all yourself.
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Quicker, More Aggressive Growth
That lower cost and essentially selling your brand and business model to third parties means that you can expand a lot more quickly than through other means. What you are looking to do here is replicate your business model across a range of new locations which should then increase sales turnover and raise the profile of your brand on the market place.
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Less Management
With a franchise agreement you don’t need to spend so much time in managing staff. That’s down to the franchisee who will have invested their own money and therefore should be focused on making sure that the operation works. That’s the one big difference between this and traditional growth because the franchisee is undoubtedly going to show a greater level of commitment because of the money they have put into it.
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Local Knowledge
Franchisees bring a good deal of local knowledge to setting up the business in their area, something which will prove invaluable in attracting customers. Most live within the location and know the people well – either from being part of the community or simply working there in business. That can help overcome some of the traditional hurdles such as networking with local companies or building an entirely new clientele and fan base.
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The International Potential
While some businesses are content to see themselves part of the UK market, others want to expand into international arenas. Having an easily replicable business model, or at least one that can be successfully tweaked for foreign markets, is important here. But so is having local franchisees who know the language and area well. It means that businesses don’t have to set up local offices to manage things and that can greatly reduce the cost of international expansion.
Of course, creating a successful franchise is not just about knowing the benefits. You have to be sure that your business is ready and set up for this approach. Then there’s the challenge of attracting the best franchisees who are not only willing to invest their own money but will add value to your brand and help build it up and expand.
Getting good advice from the outset is imperative. Working with a franchise specialist who can help with setting up agreements and formulating the right business plan should allow you to overcome some of the pitfalls out there that many business owners face. Get it right, though, and you can create a steadily expanding business that goes from success to success.
