Are you on a quest to expand your business? Useful insights you should know about.
Having a growing number of business outlets for your brand is an aspiration that is not alien to many of business owners. However, not every one of them can realize that goal. The major reason is a lack of funding or a lack of knowledge of how to make a franchise model as well as planning to expand your business by utilizing a franchise business association.
In this blog, we will cover how you can expand your business using a franchise business model from scratch. Without the knowledge of these five important steps, it might be difficult for you to start executing your franchise business plan.
Building a successful franchise model for your company requires careful planning and execution. Here are the five important elements to follow.
5 Crucial Steps to Build a Successful Franchise Model
Step @1 – Prepare a comprehensive business plan.
This is the most crucial step which will act as the foundation of your business empire. Having a strong business model that can be easily replicated later by the franchisee is the goal.
You can do so by –
- Having a pre-fixed business model that is adaptable to changes is the key. You also need to keep modifying the model till you start getting successful results.
- Set a unique value proposition for your business and set a reminder to let it reach each of your franchise units. This is what sets you apart from all the other brands available in the market.
- Keep documenting your operations and do a complete analysis of the highs and lows in your business plan. With time you will be prepared with your comprehensive operations manual. This is the base of your business model.
Step @2 – Stand out in the market.
Having laid the foundation of your business, you now need to make a presence in the market. Remember the more value your brand has, the better chance of starting your franchise. All you need to do is build a Brand for yourself.
Tips to get you on the road to starting-
- Design a logo that speaks for your work, your aim, and your ethos.
- Conduct market research to incorporate the needs and trends of the market in your business plan.
- Next, Plan a strategic marketing move to make your brand a popular choice.
- Always remember to stick with the goals of your business model.
Remember it is very important to create brand awareness to attract both customers and franchises alike.
Step @3 – It’s time for legal documentation.
Every company planning to become a franchisor needs to prepare the franchise structure for its business. Having the right legal documents is very crucial in India. You will need help from franchise experts at this stage.
Here are your options to get the right documentation for establishing a franchise business model –
- One way is to take the help of a franchise attorney to get done with the documentation process.
- The easier way is to visit Sparkle🌟Minds and take the help of franchise experts in the documentation stage. Their library is known to have the largest collection of document templates covering all your legal, marketing, and operational document requirements. Wewill make sure that all your documents are prepared for you. Is that easy? Yes, it is.
Here is a brief list of important documents required to complete your franchise process –
- Franchise Agreement – It is the legal document between the parent company and the other entity, drafted under the Indian Contract Act which contains the authority of sharing trademark and franchise opportunity by the parent company to the investor, in return for a share in revenue or royalty. It is the basis of the relationship between the franchisor and the franchise. The agreement includes the roles and responsibilities of both franchisor and investor along with terms of renewal or termination of the contract. It is the most crucial document of the business model.
- Operating Manual – It acts as a blueprint for a franchise system and a go-to manual for smooth functioning for a franchisee. The franchisor must manage the level field in all the franchises of the parent company. A well-written operating manual covers in a comprehensive manner the goals of the company, its payroll and accounting methods, methods of training, and a well-established customer service system. It is thus a very crucial manual for the conduct of the franchise.
- Franchise Marketing Kit – This kit acts as the link between the franchisee and the franchisor’s agreement. It is designed in such a way that it contains all the crucial information starting from the detailed franchise offer, the ROI (Return on Investment), the company’s history, background, its promoters and all that is expected from the franchisee.
- Franchise Approval / Rejection Letter – This is a draft letter that can be easily utilized by the franchisor to inform the franchisee about the acceptance or rejection of their franchise proposal.
Other useful documents include the Franchise Letter of Intent, Franchise Disclosure Document, and Training Manuals.
At the documentation stage, you need to ensure that all your documents meet the legal standard and are made as per the guidelines provided for the franchisees.
Step @4 – Training the Other Entity
The success of a big business empire depends on the performance of all its units. As a franchisor, you need to provide the right training and guidance for the smooth operation of business to your franchise partner.
For this, you can follow these quick and easy steps –
- Identify the skills and qualities you are looking for in a potential franchisee.
- Register with a franchise consultancy and become their listed company openly seeking franchisee candidates.
- Once you are done with the onboarding, provide complete training to the franchisee so they can relate to your brand, your goals, and everything that you stand for.
- Training your franchisees will also ensure uniform operations across all your franchise outlets.
- Also, make sure to set up an identical technology operation in all your business outlets. It will further help in running and connecting the business digitally.
Step @5 – Keeping an open communication channel.
This step is the key to the successful conduct of your franchise outlets. As a franchisor, you need to provide an open communication channel for your franchise partners which they can access whenever they require help and support.
It includes ongoing operational support, marketing assistance, customer support, as well as regular connection in the form of updates and feedback to help them go and grow the outlet. This step will solidify the relationship between the parent company and its franchise partners which will eventually help in the successful expansion of your business.
Having covered the five crucial steps to build a successful franchise model, let’s clear some common myths that stop you from realizing your dream of building your successful business empire.
Common Myths regarding starting a successful franchise business model
# Myth 1 – Franchising your business may lead to the deterioration of your brand value.
- True
False
Franchising is considered a low-cost method to expand your business. It helps the franchisor in business expansion without investing in opening the outlets. Franchising has the potential to increase both your brand value and your brand affinity. All you need to make sure is to provide adequate training, support, and balance to your franchise partners which will ensure the successful expansion of your business.
# Myth 2 – It is hard to find a potential franchise for your business model.
- True
False
Finding a potential franchise partner may seem like a tiresome task in the beginning, but there are many tried and tested methods to get this job done. The most popular is getting listed as a company providing franchise opportunities in a famous consultancy company, like Franchise Bazar. With this, your job is done. It is the company’s responsibility now to bridge the gap between you and your franchise partner.
# Myth 3 – The differences of opinion on operational decisions between franchisor and franchisee can affect the business.
- True
False
While it is true that the franchisor and the franchisee might not agree on anything or everything, this is where the franchise agreement and the operational manual come into place. Having a comprehensive franchise agreement agreed upon by both franchisor and franchisee will work as a problem-resolution mechanism between both parties involved. The key is to cover all the important points in the agreement and come to a resolution even before the problem arises.
To Conclude,
Always remember that building a successful franchise model needs effort, time, and commitment from your side. However, you can always share your workload with Sparkle🌟Minds as your partner in the journey.
Whether it is completing the documents or finding the right franchisee for you, we are here to assist you.
You can make your successful business plan with the help of Sparkle🌟Minds expertise. All you need to do is visit the website, explore the various options available, and choose for yourself.
At last, we wish you a very successful expansion of your business model and Happy Franchising.
