Make sure your revenue is strong and your systems and processes are in order, an expert advises.
It’s a misnomer that you need multiple locations before franchising a business model. Franchising offers business owners a way to expand their company without having to run multiple locations on their own.
Steve Beagelman, president and CEO of SMB Franchise Advisors, shares a few tips for brands to consider before expanding their model through franchising.
Before a brand should consider expanding through franchising, it’s important to make sure revenue is growing.
“You don’t want to come to a consultant and say you want to franchise your business when your sales are down,” said Beagelman.
Protect Your Name
“Make sure to trademark and protect your brand so no one else can take it from you,” said Beagelman.
According to Beagelman, many brands don’t think to do this right away. If your company has its sights on expanding and franchising, owning the rights to the brand name will protect your company from others taking it from you.
Get Systems and Processes Down
You have a successful business model, make sure it’s being replicated. There is a lot more that goes into owning a franchised business than someone buying a location. There needs to be documented systems and processes so franchisees can replicate the business at their location.
It’s important to write down and document policies, procedures and systems that your business uses. These documents can be used if you decide franchising is right for you, and it will aid in creating operations manuals for franchisees.
Get Accounting in Order
It takes a lot to get a business ready for franchise expansion. One of those things is making sure your financial house is in order. Before you consider going to a franchise consultant to start the franchise process, make sure to clean up your books and make sure everything is accounted for and all tax information is completed.
Invest in People
You’ve heard the saying “Surround yourself with good people.” When franchising a business it’s more important than ever. It’s imperative to have good people on your team who will help you expand the brand through franchising.
“If you can’t extract yourself out of the daily operations of your business and you don’t have people who can help you run your business while you’re franchising, then you shouldn’t expand,” said Beagelman.
It should also be noted, that a franchisor should also be a great leader. It’s important to have people follow you and your business model to get people to invest in the franchise opportunity.