Is Your Business “Franchise Worthy?”

There are many factors in making sure a business is franchise worthy and I go through all the things that should be analyzed step-by-step in my book, "Grow Smart, Risk Less," Two primary elements must be established:
  1. There must be a demand for the services or the products that the business is selling, and
  2. Demand must be expandable to a larger geographical area (it can't just be something that is a local flavor). The consumer demand has to be there in Florida as much as it is in Illinois to make franchising the right avenue because it's about scaling to a larger geographical area.
It also important for the company-owned model that's going to be franchised to be profitable and successful. But you have to do the same analysis to make sure that once you add in the fees that franchisees will spend, that they can be profitable as well. In this way, it is looking at both the franchise concept viability, but as or more importantly the viability for the franchisee. Consider how you’re going to pitch your franchise concept to prospective franchisees. Franchising a concept has to go beyond meeting a marketplace need. As a franchisor, you get to wear new hats, including the ‘franchisee recruitment’ hat. Be sure to consider whether franchisees would easily be able to see themselves doing the work you do every day and hone in on what makes owning your business truly compelling. A feasibility study is also key and can help provide insight into the competitive landscape. To determine who competitors are, even a simple Google search could give you an idea of who is out there providing your product or service. From this, you can start to create a list of the ones that come up often. There are also ways to access public information on all of those companies to see how many franchise units they are selling, and how profitable are they, and how their franchisees are doing. And we go through in the book, step by step, exactly how to get access to this information that many business owners might not know how to tap into. Another important element that plays into being franchise worthy is, as a business owner, understanding that you aren't just in the business of selling your product or service anymore – you are operating your original business model but you also have a franchising business model as well. It’s not just about making sure your model is viable. But once you make the commitment you're going to be a franchisor, for the sake of your franchisees and the sake of your business, you need to go back and be a student and understand that there's a business that you came from and there's a business of franchising, and they're different. And, ultimately, you need to become a student of franchising to truly do it well.