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Growing a franchise requires careful planning, and one aspect of the development process is the franchisor determining how much they will spend to make a sale. Unfortunately, there isn’t exactly one right answer to “How much does it cost to sell a franchise?” Different franchisors leverage varying approaches, and the cost to sell will hinge mainly on existing resources and long-term goals.“We look at marketing, trade shows and hosting our potential candidates for our budgeting purposes,” explained&nbsp;<a href="https://www.linkedin.com/in/todd-haavind-40915564/?utm_source=1851franchise.com&utm_medium=article&utm_campaign=franchise-goal-setting-part-1-how-much-does-it-cost-to-sell-a-franchise-2719902" target="_blank" rel="nofollow">Todd Haavind</a>, VP of franchise development at&nbsp;<a href="https://www.campbowwow.com/franchising?utm_source=1851franchise.com&utm_medium=article&utm_campaign=franchise-goal-setting-part-1-how-much-does-it-cost-to-sell-a-franchise-2719902" target="_blank" rel="nofollow">Camp Bow Wow</a>. “We base our marketing budget on the number of leads we want to acquire. In Camp Bow Wow, we look for about 3,000-plus leads per year and adjust the spending to the most productive lead sources. This may change during a year if we see a better or lower performance from any single type of lead source.”Haavind shared that looking for prospects who have shown interest in multi-unit ownership can be more efficient in the long-term rather than budgeting a “per-unit” marketing spend.&nbsp;As a franchisor builds out its strategy and budget, there are a few things to consider and practices to implement.<h4>Where Have Previous Sales Come From?</h4>Stay conscious of approaches that have worked in the past. If there is a certain expo that has been very fruitful in previous years or a current franchise owner that has expressed interest in obtaining additional units, there is no shame in taking a proven route!Building these sources into a budget and strategy ensures that the more trusty techniques are accounted for before branching out to additional approaches.<h4>Budget for Diversified Lead Sources</h4>While tried and true sources are great, they should not be a franchisor's only strategy. Working to identify and budget for diversified lead sources can provide a bit of cushion and create space for new, unexpected sources to shine.<h4>Be Open To Change</h4>“Review lead performance often to determine when a change is needed,” Haavind said.&nbsp;While there is something to be said for creating a plan and sticking with it, periodic performance reviews are a great way to stay in the loop and be conscious of when a change may be necessary. Try to find a healthy balance between adjusting a strategy too frequently and being so stubborn that there is no space to pivot.<h4>Be Transparent About What Type of Owner You’re Looking For</h4>Save time and money by simply being straightforward and realistic. Building a strategy and budget without a specific target or goal in mind is a poor practice to adopt.&nbsp;Rather, spending just a bit of time identifying a target franchise owner — including financial requirements, cultural fit and long-term goals — can lead to a much more informed development strategy. Instead of drawing in any and everyone, franchisors can dedicate their funds and efforts to prospects most likely to be a great fit for the franchise network.<h4>Consider Early Adoption of New Industry Trends</h4>“Try new ideas or industry trends to test if they may work for your concept,” Haavind added.Leaving a bit of space in the plan to embrace the most recent industry trends can help a franchisor determine whether a certain approach fits its concept. Test driving a trend while it's young can allow the franchisor to be one of the first adopters if it is a good fit, demonstrating innovation and leadership to prospects.

Franchise Goal Setting Part 1: How Much Does It Cost to Sell a Franchise

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There is no one-size-fits-all answer, but there are steps to take to make the most of a franchise development strategy and budget.

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Franchise Goal Setting Part 1: How Much Does It Cost to Sell a Franchise

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