Companies have been franchising for more than 50 years now with varying degrees of success. Make no mistake, franchising a business is a major undertaking. There is a lot to think about-geographical and operational issues, potential competitors, financial investment, and much more. We thought it might be useful to break the process down into the essential to-do list for the prospective franchisor. It's not meant to be all-inclusive by any means, but it should give you an idea of what's ahead.
Legalities-Prepare a standard disclosure document. At minimum, the FTC requires every franchise to have a Uniform Franchise Offering Circular (UFOC) before offering franchises for sale in the U.S. Some states have additional registration requirements. Get ready to have literally hundreds of business issues spelled out in print.
Financials-Prepare audited financial statements. This is actually a required part of the UFOC so until your statements are audited, you won't be able to legally proceed with franchising. You'll need an accountant with experience in producing these audited statements.
Systems-This is the heart and soul of any successful franchise company. Every aspect of your business must be developed to the point where it is easily replicated. Then every detail must be documented.
Training-You will need a training program plus qualified people to provide the training. The better your training program, the more successful your new franchisees will be.
Marketing-Formalize your marketing plan. Remember, you will need two sales systems: one for your franchisees to follow that will drive customers into their units and one for you to use to recruit those new franchisees. Prepare marketing materials that can be easily duplicated.
Quality control-Create checklists, policies, procedures and tactics to ensure your systems are uniformly enforced.
Attitude-This is perhaps the most important item of all. You must be focused, positive, flexible, and dynamic-all at the same time.
A Checklist for Franchising Your Business - To learn more about this author, visit Mary Tomzack's Website.
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What is franchising? My personal definition!
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Working in the franchising community for 25 years, I have come to define the concept of franchising, based on my personal experience.
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Mary Tomzack
(Visit Mary's Website)
MARY E. TOMZACK is the President and
Founder of FranchiseHelp, Inc. She is a
noted franchise expert and the author of
Tips & Traps When Buying a Franchise
(First publication,1994,McGraw-Hill; new
and completely updated, revised edition,
1999,Source Book Publications). Ms.
Tomzack is often interviewed for franchise
articles in publications such as The New
York Times, "Franchise World" and
"Entrepreneur Magazine."
Reach her at (914) 347-6735 or at m
tomzack@franchisehelp.com or co
mpany@franchisehelp.com
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