Why should you franchise your business?

What is the end goal?

The goal for any established business owner when considering franchising their pre-existing business is ‘expansion’. Franchising your business allows you to expand without incurring any risk of unnecessary debt or you won’t be using the cost of expansion against the equity of your business. In essence, any new recruited franchisees will in the first instance provide all of the required capital (franchise fee) to ensure they can adequately launch and operate one of your franchise units, it effectively allows you to grow your baby (business) through the resources of others.

Once you’ve gone through the consultancy stage of franchising you should in theory have a model that has demonstrated a solid track record of performance and has successfully over time built up a reputable brand and image. This, with adequate business plans to support the acquisition of your franchise (you can seek assistance from any top bank with producing business plans for prospective franchisees) can make it easier for prospective franchisees to gain finance when purchasing your franchise.

Franchise your business

It's not all easy sales, your reputable franchise consultant should nail down the importance of setting up a solid head office infrastructure to ensure all franchisees are fully supported with their journey under your wing. They will need training and continuous support on how to maximise returns through their franchise. This will benefit both you and them, the more profit your franchisees make then the more profit you’ll enjoy. Franchisees tend to pay a set % of profit each month as a management service fee to the franchisor, in some instances they will also pay a small % towards the franchise groups national marketing levy as well. This is to ensure that the brand and offering is continuously put in the right place to ensure business is constantly flowing. Unfortunately, it would be very difficult for you to undertake all of this by yourself and your franchise consultant will advise on what support network you should set up, this can start small and expand with the growth of the franchise network.

Reduce the burden on head office

Like most business you may be in a position where you’ve secured numerous national contracts and although lucrative, are becoming more and more difficult to service, especially as your reputation grows. So why put the burden on your one office to support and maintain all these contracts? Established contracts/business within designated franchise territories can be sold/marketed at a higher price. So, you as the business owner can make profit as you’re effectively handing over pre-sold business that could be reoccurring for the franchisee and further to this, you’ll then earn a percentage each month through your management service fee as well. It’s a win/win for both parties, you’re ensuring you still earn what you’re due from making the hard sale but the franchisee profits from a sale being made for them.

Franchising your business isn’t cheap but in the long run it’ll be worth it if you seek the correct franchise consultant and franchise lawyer. We strongly advise that you undertake the correct due diligence when seeking a franchise professional to franchise your business, speak to businesses that have successfully franchised their business and how the transition was for them.

Once completed, your new franchised business will provide a proven concept for prospective franchisees that will be extremely attractive, especially when compared with start-ups as Franchises have a much higher success rate. 


Ali Khan - 9 months ago

need advice on how to turn my business into a franchise

Franchise Supermarket - 9 months ago

Hello Ali, Please email the team at info@franchisesupermarket.co.uk and we'll be more than happy to assist. Thanks