My HMO Journey: No rest for the wicked as we approach...
Put yourself in the mind of many business owners, they’d like to expand but resources funds and time are all against them. They know that by working longer days and weekends they could free up some more time, at the expense of the family, but money and people, they go hand in hand and are another problem altogether.
Then someone mentions franchising, and on the face of it it would appear to solve some of the problems. The easiest way to explain what a franchise is would be to say that you can use someone else’s money to grow and expand your business whilst at the same time keeping control of your brand / identity and values. What’s no to like?
Well still doesn’t help with the time problem. You are after all working plenty of hours a week as most business owners do.
That’s where a franchise consultant comes in. In some businesses the opportunity to get help and advice from an outside expert is sometimes looked down upon. But a relatively small amount of investment, in terms of time and money can lead to large savings of both further down the line.
The starting point for any business when thinking about expanding using a franchising model is to consider several key points, which we call 5 star franchising.
We look for a business which is operating profitably, ideally in more than one location, and which has a proven and successful operating system. The easier it is to re-create the operation in other places the better. Likewise, the sooner someone new to the business can learn how to operate or manage it, the easier it will be to find franchisees and get them up and running quickly.
Next we need to look carefully at the how the finances would work, and how the business would be structured if it were to operate as a franchise. Can both the franchisor and the franchisees achieve sufficient income and make a reasonable return on their investment? Generally speaking that means the higher the gross margin the more likely it is that there will be enough money to spread around.
Finally, and arguably most importantly, the business needs to either have, or be capable of adapting to, a culture which lends itself to franchising. That means working together, with clearly identified roles and responsibilities, towards a common aim of building a successful brand.
Businesses which are failing, or are currently no more than an idea, are not good propositions for franchising.
If a business can satisfy all of the above points, then the chances are that it can be franchised. The next critical task is working out the best way to franchise that particular business, and to engineer it into the best franchise that it can be.
As I said earlier you may not have the time or resources to do this, by employing a franchise consultant to assist you can get things moving far quicker and in the long run and with less chances of making mistakes along the wayFrom my experience there are several ways that you can work with your consultant. The first is invite them in and let them do the review for you, they will be able to tell you how viable your business will be as a franchise. Second option is for them to write you your processes and manuals to get started in franchising.
It’s the third way that we at The Franchising Centre prefer, when we produce your franchising processes and documentation we then help you to implement them for you. We guide your fledgling franchise until it is ready to fly the nest. This can take between 12 and 18 months, so it is a big commitment on both sides.
So we can help you expand and grow your business through franchising and using other people’s money. We become the missing resource that you didn’t think you had, but most importantly we give you the time to focus on your business and its day to day running, you can still work evenings and weekend if you want too – that would now be your choice