The importance of planning when franchising
by
Norton Rose
“Entrepreneurs embarking on franchising need to look at themselves carefully. Ask yourself – honestly- are your goals realistic and attainable? If you need financial help, will you allow a lender an equity position? Do you have the patience, tenacity, and self-discipline to start a fledging business or convert yours to franchising? Can you develop and sustain relationships with many different personality types? Are you willing to make the necessary sacrifices and contend with the effects on your family and other areas of your life? Can you give up some of your independence to franchisees or get them to ‘work’ with you? Can you attract, hire, train, manage, and develop important staff who will respond to you personally? What type of personality are you? Being a franchisor is time-consuming and expensive. Are you ready?”
Often franchisors will have an intuitive feeling that their business can be franchised, perhaps prompted by enquiries received from interested parties. However, they will not know whether it is in fact feasible, and will be nervous about embarking on a franchising program without assistance.
The first step is therefore a feasibility study, generally followed by some form of pilot operation. Without successful pilot operations, the necessary systems and formats evolve from the experiences of the franchisees. If a pilot operation has not been utilised to back up representations made relating to the success that a franchisee could expect, it is difficult to justify and statement made relating to projected earnings.
See the buying a franchise and running a franchise pages for further assistance.
This article was created by Deacons and appears courtesy of Austrade . 26.06.2007
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Tel: 03 8686 6000
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