The 2 Things New Franchisors Need to Do in Year 1 of Franchising

It’s no secret that franchising is a booming industry. In fact, in 2017 the franchise sector was expected to grow by $36 billion according to “Nation’s Restaurant News”. Many business owners want to capitalize on this trend by introducing their brands to new audiences across the U.S. through franchising. 1851 spoke with two franchise experts who shared the two most important steps new franchisors should take during their first year of franchising in order ensure future success.

1. Perfect the Business Model

Steve Beagelman, President & CEO of SMB Franchise Advisors*, believes there is nothing more important than perfecting your business model when starting your first franchise. Beagelman explains, “Make sure your franchisees have the support they need through the implementation of good systems and good processes that set them up for success.” After all, one of the top reasons franchisees become interested in franchising is because it comes with a ready-made business model.

Sean Fitzgerald, Chief Development Strategist at No Limit Agency*, agrees. “If you own a sandwich shop, that means you’re good at making sandwiches. Once you begin a franchise, you are working in a sandwich system and you need to understand the importance of supporting your franchisees.” In order to build that skillset, Fitzgerald recommends tapping into a franchise consultant. A consultant can analyze your business model and help outline the processes you should put in place to make it easy for a franchisee to replicate your success in a new market.

2. Choose the Right Franchisees

Once you have your processes in place, the next step is to choose the right franchisees. Fitzgerald believes your first few franchisees will make or break you. He explains, “You have to make sure your first franchisees are successful on all levels. This may mean giving them more time and resources than initially intended, but if your first three franchisees aren’t happy, you’re going to have a hard time growing your brand.”

Beagelman agrees, “Over support your franchisee in the beginning, and understand your support as a franchisor depends on their success as a franchisee. Help your franchisees find the right location, provide the financial support they need and make sure you are setting them up to make money.” He goes on to say, “Location, location, location. Your franchisees will find their site, but you have to approve it. They may have found the perfect location in New York City, but do the economics of the site set your franchisee up to make enough money to be successful?” Going above and beyond for your first few franchisees will help entice future franchisees to your brand.

Your first year as a franchisor will be a lot of work. But with the right processes in place and consistent strategic support, you and your franchisees are being set up for a lifetime of future success.