Before you get all excited about franchising, I strongly recommend that you ask yourself a few questions about your business. These questions may seem simple and may even have an element of common sense to them, but you will be surprised how often they are overlooked when the excitement of franchising nationwide kicks into high gear. As you know, I am a huge fan of Franchising and it is exciting, but so often I talk with business owners whose best option is not to franchise for various reasons. Here are just a few questions:
- What is unique about your business? Ask yourself what separates your business from competitors in your industry. You should be able to easily identify your unique selling proposition.
- How long have you been in business? If you have an idea, but the business is not in operation I can tell you right now, you’re not ready to franchise. Legally nothing can stop you from franchising, but without history of the business working you have no validation or credibility which means it will be very hard for you to sell franchises.
- Why does someone need your business model to operate this business? What are you providing to them? In other words do you have proprietary programs, systems and/or processes. People buy a franchise because they do not want to “figure it out“. They simply want a business model that has been proven to work with systems in place, ready to operate and with effort will immediately generate revenue.
- What are the various ways to generate revenue in your business model? Seems pretty straight forward, but sometimes a hard question for business owners to answer. Not only should you identify the various ways to generate revenue, but are you making a profit? Seems pretty basic, but you should be able to determine that if the business is ran correctly whether or not it will be profitable.
If you cannot answer these few questions, then nobody will be doing you any favors by bringing you on as a client to franchise your business. In fact, it would be in your best interest to save your money and invest your resources on further developing your business so that perhaps one day it is ready for franchising.
