Franchise businesses have evolved beyond fast-food restaurants and gas stations. There are now hundreds of different brands across various industries that offer franchise opportunities to smart and capable people. In fact, the economic outlook is bright for franchises in 2016 and beyond.
If you run a successful business, you might have thought about selling franchise rights to other entrepreneurs. The overwhelming advantage is that your brand will grow at a much faster rate than you could achieve on your own. But there is more to consider. Here are some other questions you should ask yourself before you offer franchise opportunities.
Will my business be appealing to potential franchisees?
The truth is few businesses make for good franchises. Good franchise options have a strong appeal and clear distinction from similar businesses.
For example, if you own a typical burger restaurant, it probably won’t make for a great franchise. Even if it’s a successful business, it’s not the most groundbreaking concept. But if you offer unique menu items or have other factors that make you standout, other business owner may want to replicate you idea.
Is your business idea easy to understand and copy?
Successful franchises are easy to replicate. Any potential franchisee should be able to understand what you do and how you do it. That means the way you operate shouldn’t be too complicated.
If you do decide to go ahead and franchise your business, you should have clearly documented procedures. You want each franchisee to operate in a consistent manner so you should offer a “playbook” they can follow in order to achieve success.
Can your business succeed across multiple locations?
If your business is successful because of its specific location, that’s great. But it probably won’t make for a good franchise.
If you’re going to offer franchise opportunities, your business should be free of location restrictions. It should be able to succeed in any suitable location that is frequented by potential customers.
Do you understand the laws associated with franchising?
There are a number of federal and state laws that must be followed when offering franchise opportunities. For instance, you must present each potential franchisee with a Franchise Disclosure Document (FDD) that consists of very specific information.
Be sure to consult with a lawyer before offering franchise opportunities so you understand the laws you must adhere to.