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Building a Franchise Model that Works

If you’re an ambitious entrepreneur who wants to start a business and grow it through franchising, there are several things to consider. Franchising is a lot more involved than awarding a franchise and handing over the keys to the new owner. It requires a tremendous amount of planning. Your franchise model should attract both customers and franchisees by including the following elements:

A Strong Concept

In order for your franchise to be successful, it has to attract customers. The best way to do that is by providing a product or service that fulfills a need or solves a consumer challenge better than existing businesses in your community.

To build a franchise model that works, your business will have to be viable in other markets. To franchise, you must be able to duplicate your business in other areas and receive the same, if not better, returns than in your home market. Think about your concept and consider if consumer demand for your product or service in other areas would be as great. Customer profiling, competitive landscape, and market demographics should all play a role in that decision.

Entrepreneur working on a laptop computer

An Easily Replicable Model

Since you will need to open multiple locations in different markets to build your franchise system, your concept should be as simple as possible to replicate. Product, service, operations and support should be the same at every location. Consumers count on consistency of product or services being the same at whichever franchise location they visit or purchase from. It’s one of the top attractions for consumers and is instrumental in converting infrequent visitors into regular customers. Replication goes a long way toward brand recognition and loyalty.

Exterior photo of a Play It Again Sports retail store

Your franchisees will depend on operations and support being the same for all locations, too, as some of your franchisees will want to become multi-unit owners. If you attempt to operate a franchise with systems that can’t be duplicated across the chain, you’ll end up with inefficiencies and confused and angry franchisees.

Comprehensive Support System

A sound franchise model includes a strong support system supplied by the franchisor to franchisees. Support systems typically include, but are not limited to:

  • Training
  • Site selection
  • Grand openings
  • Collaboration to solve major issues
  • Marketing
  • Field Support
  • Technology

Training is a significant part of support. If all franchisees are trained the same way and are able to train their employees using the same criteria, your franchise system will develop consistency of operations and you will be on the right trajectory to grow your brand. Support should also include a healthy professional rapport with franchisees. It’s important for franchisees to feel they can rely on their franchisor. Keep in mind: your franchisees represent your brand. So, if your franchisees fail due to lack of support, your entire brand will fail.

Training room at a corporate headquarters

An Effective Leadership Team

Building your leadership team begins with your vision and recruiting members who are passionate about it and bring franchising experience. That applies to the CEO, COO, CMO, President, Vice President and so on. They will be instrumental in fostering company culture at the corporate level, which should also permeate the franchisee level. If your vision is effectively conveyed to consumers, it will attract like-minded customers.

Treat your franchise development team as part of the leadership team since they will be working directly with potential franchisees. Like the top of the leadership team, the franchise development team should be made up of members who share and support your vision. They should also be skilled at vetting potential franchisees so you end up with franchisees who fit well with your franchise concept and brand culture.

The Right Franchisees

If you’re envisioning selling franchise units to everyone who walks through your door with a check for the franchise fee, think again. You should determine who you want to represent your brand before you start selling franchises. By awarding franchise agreements with the right people – individuals who are genuinely excited about the brand and want to help it grow, share your vision, are well capitalized and can get along in a franchise system without going rogue – your brand will grow the right way. By not thoroughly vetting franchise candidates, you risk bringing on board partners who can damage the brand.

A handshake agreement

Transition from Founder to Franchisor

By franchising your business, your role changes to be more franchisor and less founder. Your role will change as you give up more control (not all of it, though) to become the franchisor. Besides actively selling franchise units in the beginning, you will delegate tasks, set expectations and navigate risk – all which will take you away from day to day duties of running a small business. Developing a franchise model that works should include a transitional path to becoming a franchisor.

For help developing a viable franchise model, contact Winmark Franchise Partners. With 30 years of franchising experience and more than 800 franchise owners representing over 1,200 locations for five brands, Winmark Franchise Partners can help you build a strong franchise system. Contact us here or at (844) 452-4600.