others.
“Franchising should be treated as a separate business outside of your core business,” Kushell says. “It demands the same critical thinking, expertise, and hard work that any other successful venture requires.”
Before becoming a franchisor, you will also need to:
Have a business plan. This document is one of the most important tools to help you obtain financing. A solid business plan provides more than just historical and projected financial data. It’s a comprehensive document that details the purposes of the plan, background of the venture, analysis of the market, description of the product or service, and management’s experience. It also considers the viability of operating a franchise program and establishes a strategy for success.
A viable business plan is generally composed of: an executive summary detailing your goals and objectives; a brief summary of how you got started; your company’s goals; biographies for yourself and other key individuals; a description of product or service; market potential for your product or service; a marketing strategy; a three- to five-year financial projection; and an exit strategy.
Sandra Conaway, assistant director for Maryland’s Central Region of the SBDC says that it is possible to write a business plan yourself. However, it is a good idea to have someone familiar with the components of the document to review or assist you.
“When you begin writing your working document, I recommend consulting with a SBDC counselor who will review, critique, and provide input about the information you’ve gathered. If more data is needed or you have further questions, a counselor will refer you to the right resource to complete your business plan,” Conaway says.
To view examples of sample business plans, Conaway suggests the online site, Business Plan Pro, at www.bplans.com. This site provides more than 100 free business plan samples, covering a wide range of industries for your review. In addition, you can contact your local SBDC, for a more comprehensive list of business plans to use as a template when writing your own.
Determine your role. Do not try to do everything yourself. Determine who will take on the added responsibility of running both the core business and your new “first child.” Will you need to hire and train additional staff to handle the expansion? Do you have the management skills? If you lack expertise, will you relinquish those duties to someone more qualified?
Be sure to hire someone reliable who can handle those responsibilities that prevent you from focusing on the bigger picture– growing your franchise. Brewer states, “Initially, you will want to do everything yourself because you need to know your business. However, there will come a time when it is not only necessary, but also mandatory that you bring others on board to help you to take care of the day-to-day aspects of operating the franchise. ”
Document your business. A franchisee does not want to reinvent the wheel to be successful. Therefore, document your policies, procedures, forms, business practices and systems into a user-friendly operations manual, known as a franchise system.
Franchising is a costly endeavor, but