Business owners have the opportunity to transform their companies into franchises. This is the perfect solution for those interested in faster business growth and more revenue. The basics of franchising an existing business lie in the preparation of the most important franchise documents – Franchise Disclosure Document (FDD) Template, Franchise Operations Manual, and Franchise Agreement.
Franchising a business is definitely not an easy task but it can be easily accomplished as long as you know where to start. Here are some of the most important issues that every prospective franchisor must address.
How to Franchise a Business
The most important issue to address prior to taking steps to franchise your company operations is to evaluate its overall performance. Franchising is not the key to fixing problems; it is the key to making a stable and successful business into a bigger and better one. If your company is having problems with sales, customer service, efficiency, marketing, or anything else, these issues must be addressed prior to franchising the business.
The next step for anyone interested in how to franchise their company should be to determine whether their business can be franchised at all. There are successful franchises in a wide range of industries; however, there are some businesses that are not suitable to be franchised. The reasons may be connected to the type of products and/or services offered or to the way company operations are executed. Whatever the case, failing to assess the franchisability of your company may lead to disappointment.
Once it is confirmed that a company has franchising potential, it is a good idea to check what return of the initial investment is expected. This is an essential part of the process. The results of this type of evaluation will help business owners to prepare their business and marketing plans.
Every guide about how to franchise an existing business emphasizes the importance of business and marketing plans. Comprehensive business plans and marketing plans are crucial to the success of future franchisors. A well-written business plan will set the goals and a good marketing plan will detail the main requirements of the new company.
The final step of creating a franchise is to put in place the officially required documentation – the franchise disclosure document (FDD), the franchise operations manual, and the franchise agreement. The purpose of the franchise disclosure document is to provide potential franchisees with information about the franchisor. It must contain information about the financial condition of the company, the members of the top management and sales departments, how renewals and terminations will be handled, how trademarks, copyrights, and patents must be used, and so on. The Franchise Operations Manual must detail the way in which each company operation must be executed as well as the franchisor requirements regarding recruitment, staff management, equipment, inventory, and so on. The Franchise Agreement is the contract between the franchisor and the franchisee. All of these three documents can be prepared effortlessly by using FTC compliant franchise templates.