Have a better mousetrap but scared to death that the world is actually beating a path to your door? Trouble sleeping at night wondering who will knock off your operation first? Certain that yours is the next Ray Kroc story, if only you could get the capital? Tired of reading about companies and thinking, “I have a better franchise concept than that company”?
Check out the video
Why Franchising could be a good fit.
Rodney Hindmarsh said, “Franchising really breaks down to main three major areas.
First, is the cost, many people believe that franchising can cost up to $100,000 to put they systems together, indeed that can be the case but using our system it can cost in total simply a few hundred dollars, so it is achievable for many people & many businesses out there
Secondly, people believe that franchising can be risky, in other words their assets are at risk. Well I can tell you right now franchising is like any business, if you structure your business correctly your asses are more protected and in month 6 of our program we go through in more detail in relation to how to structure this to protect your assets.
The third question which I’m commonly asked is how long do I have to be in business for to be able to be franchised. There’s a common belief that I need to be in business for 3 to 5 years before I am able to be franchised and that is simply not the case. In many countries 20% to 30 % of people that franchise their business have done it within the first 12 months of operation.”
In general, companies decide to begin franchising for one of three reasons: lack of money, people or time.
The primary barrier to expansion that today’s entrepreneur faces is lack of capital. And franchising allows companies to expand without the risk of debt or the cost of equity. Since franchisees provide the initial investment at the unit level, franchising allows for expansion with minimal capital investment on the part of the franchisor. In addition, since it’s the franchisee, and not the franchisor, who signs the lease and commits to various service contracts, franchising allows for expansion with virtually no contingent liability, thus greatly reducing a franchisor’s risk.
Towards the end of the 1980’s Rodney Hindmarsh carried out comprehensive market research assessing the future potential for franchising in the UK. This led to the foundation of How2franchise in 1990. He is now recognised by many as an expert in the field of franchising and has a strong background in sales and marketing. Mr Hindmarsh’s extensive experience in designing and planning new networks and implementing the practices that deliver growth. The Owner of How2Franchise is a very successful leader in franchise development, and now has over 20 years experience in franchising, marketing, and sales. The How2Franchise development program into a nationally and internationally respected franchise consultancy and website group.
Every new franchisor quickly learns that when they turn to franchising, they’ve entered a completely different business. Regardless of how you make money as a franchisor, you’ll have two roles: selling franchises and servicing franchisees. And of the two, ensuring the success of your franchisees is the most important.
Properly structured, franchising can allow small companies to more effectively compete with much larger competitors. It can also allow larger companies to gain the advantages of highly motivated unit management while reducing overhead. As such, franchising is an option that more and more companies should explore.
The key to success in franchising is successful franchisees. Without successful franchisees, no franchise system will last. But if you can put the interests of your franchisee first, those same franchisees might help you become the next McDonald’s.