Tips for successful franchising

in association with Lloyds TSB

Clonability: it should be easy to transfer your service expertise or know-how to franchisees.

Competitiveness: think how to make your product or service unique, to attract both franchisees and customers. What’s so special about another fast print, home-delivery pizza or cleaning franchise?

Profitability: profit margins should be large enough to support both franchisor and franchisee.

Specialist advice: to develop a sound franchise agreement, along with effective training documentation, seek specialist help.

Franchisee recruitment: be discriminating when you start out. Otherwise a weak foundation may wreck the whole system.

On-going support: To maintain your franchisees’ motivation it is essential to make sure you provide ongoing support. Otherwise they will ask “What are we getting for our fees?” Do not under-estimate the resources and effort required to sustain a network of franchisees.

Ailing businesses: franchising is not the way to rescue a struggling enterprise. Payback time will be long, initial investment high, and initial franchisee fees might cover only recruitment and training costs.

Contingencies: changing circumstances can blow the best-prepared plan off course. Make sure that sufficient additional finance is readily available.