According to the IFA (International Franchise Association) Franchise Business Economic Outlook for 2018, 759,000 franchises operating in the United States (up 3% year on year) employ 8.5 million people. That’s 2.1% from 2016 and makes up 4% of all U.S. businesses. Franchising is an excellent business model because it allows franchisers to benefit from their proven business model and allows franchisees to operate a business using the franchiser brand. The development process for a successful franchise is long and complicated. It can be particularly difficult for first-time entrepreneurs who don’t have the experience or resources of others in the field.
Going from an idea to a franchise is a long process. The franchising business world has its own set of rules, systems, and opportunities that you should know before entering it. There are many stages of the franchise development process you have to go through. This process can be daunting, particularly for those new to franchising. The American Family Care – Franchise Development explains the costs -and all the steps you need to follow in the franchise development process.
The Stages Of Developing A Franchise Business:
Franchising is a proven method of growing your business globally and rapidly without additional capital. The franchise development process takes time, but the returns are worth it.
- Franchise Development Research
The first step in the franchise development process is to conduct thorough research. Research can take many forms, such as customer research, a market demand study, an assessment of your current business, understanding your target audience, and industry analysis. However, it often involves talking to people in your network and potential investors, who may bring you into contact with other potential investors and customers. It can be a good way of getting information about the viability of your business model as a franchise system.
- Franchise Development Strategy Planning
Once you have learned enough about your business model to know whether or not it is viable as a franchise system, the next stage is to create a plan for how to grow the business through franchising. It will likely involve creating a budget and timeline for each step in building a franchise network. It may also include creating a marketing strategy for finding prospective franchisees and selling them to join your team.
- Franchise Sales Management & Operations
After forming your franchise legal structure, you will develop the operations manual to teach each future franchisee how to operate your business. The most important thing for a new franchisor is to create a successful franchise sales system and support infrastructure that can be duplicated. You must have a solid foundation with your own business before even thinking about franchising it.
- Franchise Sales Lead Generation & Nurturing
It involves generating sufficient quality leads to feed the franchise development pipeline at an acceptable cost per lead. A good quality lead meets your target profile requirements for being a good prospect for your franchise concept or business opportunity. You will determine these criteria as part of your franchise development “launch” strategy and your goals for franchising.
You need to generate and nurture prospective buyers. The key here is to build a substantial lead generation process that provides a steady stream of qualified prospects rather than just a series of one-off leads or referrals. This effort includes creative inbound marketing initiatives and outbound prospecting to attract potential buyers, such as online lead generation, social media marketing, and search engine optimization (SEO). It also includes developing processes to capture these leads into a database and nurturing them until they are ready to buy.
- Franchise Sales Process Design & Implementation
In this stage, you will be training your staff on how to implement the sales process into their daily work. You will also teach them to identify potential clients who are not currently interested in buying franchises from you. It would be best if you educated them on the ins and outs of running a franchise. The training will deal with customer service techniques, marketing strategies, and operational procedures. You should also train on using the franchisor’s proprietary tools and technology to help manage the business more efficiently. For example, if it is opening a Subway franchise, you’ll be trained on how to use the point-of-sale system and provide all other technical support needed.
The goal of the franchise development process is to establish and maintain a profitable business opportunity based on a proven system. It’s essential to keep in mind the five stages of franchising as you develop your idea. It will serve as a roadmap for the process and help you determine whether or not your concept has what it takes to be successful. The last thing you want is to get stuck with a long-term commitment you’re unhappy with, so take your time and make sure that your concerns are addressed throughout the development process.
