Is your business suitable to Franchise?
The franchise model will not suit every business. In order to build a successful franchise, a business primarily needs to be successful, replicable, and have a unique selling point. The business needs to be attractive to potential franchisees and will need to generate a worthwhile profit for them. The franchise model depends on franchisees running successful individual businesses so both they and the franchisor make a profit.
What makes a business suitable?
A business that is suitable for franchising is likely to have:
- A product or service that is expected to have long-term demand.
- A healthy profit margin.
- A tangible business model, which can be replicated and passed on to franchisees.
- Proven sales and marketing techniques that can be applied to franchise outlets.
- A distinct selling point – for example, a brand name, a unique product or service, or a strong reputation.
- The resources, financial and otherwise, to deal with the demands of managing the franchise model.
In contrast, a business is unlikely to be suitable for franchising if:
- It requires specific skills that are difficult to transfer or learn.
- It is subject to regulation that makes the setting up of franchise outlets difficult.
- It is tied to a particular location and cannot be operated from other places.
- It particularly relies on the abilities of the originator.
In addition, any business that can easily be replicated without the need for training or resources from the originator is unlikely to attract potential franchisees.
If you would like to avail of our Franchising Services, contact us today.
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