Retail Franchising 101: The 10 Steps To Opening a Retail Franchise

The list of retail franchises goes on and on. Whether it’s hardware, wellness supplements, snacks and drinks or secondhand clothes, there is a retail franchise concept for just about anything. If you’ve weighed your options and decided that a retail model is best for your lifestyle, the next step is to get to work!

Here are the 10 steps you can follow as you work to open a retail franchise.

1. Research the available concepts. Within the retail sector, there are countless different options. You can narrow down the selection using a few different criteria — initial investment amount, type of inventory or the potential for absentee ownership.

Once the pool of opportunities has been decreased to a manageable number or a specific concept has caught your eye, it’s time to do more of a deep dive. Research the details of the concept you hope to invest in, including initial investment requirements, ongoing fees, franchisor support and market outlook.

“Most people are getting into franchise ownership to find that freedom and to take control of their destiny as their own boss,” Franchise Captain founder Corey Elias said in an August interview. “Candidates need to do their research to ensure the concept is going to bring them satisfaction in that regard.”

This research period may also include a discovery day with the franchisor, which allows both franchisee and franchisor to gather any additional information and address lingering questions.

2. Secure financing or ensure affairs are in order for the initial investment. Execute the franchise agreement. When your decision is made, it’s time to secure any necessary financing and officially seal the deal with the franchisor.

You may have adequate capital to fund the establishment of the business, but in the case that you do not, you should seek funding. This can come from organizations like the Small Business Association, and some franchisors offer internal financing and/or 401k rollover options.

3. Begin evaluating real estate options. Depending on your franchisor, you may have professional support throughout this stage. Regardless, real estate is crucial to the success of a retail concept as the growth of the business heavily relies on customers visiting the retail location.

During real estate considerations, you and any advisors you have should consider demographics, levels of traffic and competitors in the area.

4. Complete training and secure the necessary licenses or permits. Many franchisors have a required training program. This may entail a digital summit, in-person training or shadowing a local franchisee who is already established.

Any licenses or permits unique to the business should also be secured at this point. This will ensure that you are ready to operate legally come opening day.

5. Create your business and marketing plans. Don’t go into this business journey blind! Again, many franchisors will offer some sort of business and marketing structures, but these plans are not always one-size-fits-all.

Planning ahead will ensure you’re able to make the most of the resources the franchisor provides, including the business model, marketing collateral, social media advertising and more.

6. Build your team. What is a retail location without its team? Start recruiting and hiring sooner rather than later to ensure you’re able to build a complete team.
7. Once a location is finalized, coordinate build-out, furnishing and other fixtures. Though the majority of real estate-related work should have already been handled, the finishing touches should be added. Any interior decoration should be completed, and an overview of the fixtures and other equipment should be conducted to ensure gaps can be filled prior to opening day.
8. Secure inventory. A retail store is meant to sell products! Stock the shelves and ensure that there is enough inventory to satisfy the level of demand expected on opening day and shortly after
9. Choose an opening day and begin to prepare. Prior to opening day, you can begin marketing your business and any promotions that may be going on in conjunction with the grand opening.
10. Finalize any logistics and unit-level training. Opening days are typically a bit different from standard daily operations. Ensure any unique opening-day-only events or offerings are finalized and prepare employees for their first day with customers.