Franchising Step 1: Setting up the System

Before you can begin franchising, it’s important to work out what your franchise business system is going to look like.

What for?

Because you’re going to divide your existing business into two new ones: one for your future franchisees to service your customers; and the other one for you, the new franchisor to service your new clients, your franchisees.

If you don’t synchronise these two new business entities in a way that will work to grow your new franchise group, then things aren’t going to go so well.

1. Divide and conquer.

A client of ours ran a wedding business supplying both the ceremony and the reception services which ran her ragged. She decided to franchise to make the business more successful and at that point realised she had been trying to do the impossible of servicing both the ceremonies and receptions. So she created two franchise groups: one attending to the weddings and another one looking after that all important after-party. Once she did this, her franchise groups went on to become quite successful, growing year on year.

So the first part of this step is detailing exactly what your franchisees are going to do to service customers. And this usually involves simplifying your offering.

Why?

Wedding guests making a toast

Because it is unlikely your franchisees have the same exact personality and skill set as you do right now. As a budding franchisor, your entrepreneurial personality makes up a lot of the drive that go you here and has also made you an exception in your industry. But your franchisees are new to this game and will need to learn your systems in order to replicate your success.

In addition, by thinking about the fundamental service you want your franchisees to deliver, you can focus on helping them develop the primary skills they need to become the best person to take care of your customers. For example, a massage therapist to a nursing home needs to be empathetic, supportive and caring. They won’t survive if they are not.

2. Identify strengths and weaknesses.

Very few of us have a personality profile that is equal parts of everything. Life would be very boring if we did. We tend to be a little bit more of one thing over another; drivers or influencers or supporters or detailed analysts.

So, you need to look at your potential franchisee and be realistic about where the gaps are with the things they’ll need to do. Especially at the beginning of their business journey with you.

The usual gaps sit in marketing and general business areas. In spite of the fact your future franchisees will be independent business owners working within your system, you still need to be pragmatic about their true ability to take on – and successfully operate – the whole business deal.

3. Support for success. Woman and man on business meeting

A fundamental franchise group ‘truth’ is that your franchisees are the ones who bring in the money. They are buying your system to gain the advantages of your brand and your support.

As such, close all apparent loopholes and work out how you can support them to make them to become successful in business. The best franchise groups understand their franchisees will go through a business cycle of ups and downs, so they have business coaches on board to work with franchisees to build not only their business skills but their confidence as well.

4. Get the branding right.

Finally, once you understand exactly what your franchisees are providing for your clients, check with a branding consultant to ensure your brand is on point. Visual appeal and instant connection happens within moments, so getting the branding right from the start gives everyone the best chance of success.

So, what next?

Once you have your system sorted, you’re well one your way to building your franchise empire. But there’s more decision making needed, how exactly will this new business structure be put in place. What about those fees, will they cover the support you are going to provide into the future, do you need territories, this list goes on…

We know setting up the franchising system can be overwhelming, but it doesn’t have to be! Just reach out to the expert team at Franchise Simply so we can make the process easier and faster for you!

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