Ask any business owner about their goals and they’ll tell you they want to grow. One way to achieve this is through franchising. But to those outside the industry, it can seem like a total mystery and it’s hard to know what’s involved if you’ve never been exposed to it before. This article aims to review what it actually means to be a franchisor – that is – to franchise your children’s activities business and hopefully dispel some myths as to what it involved. With that in mind, let’s jump right in!
Key Responsibilities
1. Turnkey Business
First and foremost, before you can even think about franchising, you need to have a profitable business. This alone doesn’t mean that you can replicate your model and actually franchise, but it is a prerequisite. When you franchise, you are going to undertake a viability study to understand how feasible it would be to create a franchise model around your existing business. Once you’ve done this, you’ll need to document your successful business processes in the form of an operating manual and provide this ‘package’ as a turnkey business model to your franchisees. You’ll need to provide initial training and ongoing support to ensure that your franchise network is able to make money and turn a profit.
2. Continued Development
It would be a mistake to think that once you’ve created your operating manual and trained a few franchisees up that your work is done. In order for any business to be successful, it needs to keep up to date with consumer trends, market research, product and service development etc. Franchising is no different and the franchisors needs to continue to develop the business as they grow their franchisee network.
3. Brand Protection
In addition to creating, maintaining and developing a business system, the franchisor is responsible for registering the marks for all intellectual property (IP) that it will licence franchisees to use. Franchisors will protect the brand by maintaining quality standards across the business, ensuring consistence across the brand and ensure that all franchisees comply with the rules and requirements of the system. This involves both upholding the operating manual and by way of a legally binding contract known as the ‘franchise agreement’.
4. Marketing
Franchisors handle all brand advertising and (usually) provide franchisees with assistance for their local marketing activities. This might include creating branded template documents that franchisees can add personal details to, like phone number and email. But in some cases franchisors take a payment that goes into a ‘brand fund’ which is used for both local and national campaigns.
5. Training & Support
Franchisors provide initial and ongoing training and support to their franchisees. Training should be comprehensive and ensure that each new franchise owner understands what exactly is required to operate their business. It is important to note that though most franchisors are ready and willing to offer assistance and guidance, each franchise system is different and may provide different levels of support. Regardless of the degree of assistance provided, however, a franchisee must be prepared to work hard and take initiative, as no franchisor can be expected to nor should do everything on behalf of their franchisees.
Before franchising your children’s activities business, it’s important to get the right support from qualified professionals in the industry. There are experienced consultants, solicitors, associations and other industry experts who can guide you through the above key responsibilities and help you build your franchise business. The points above are aimed to provide those considering franchising with a summary of responsibilities. This will differ from business to business and industry to industry. When creating your franchise agreement, you should outline the specific responsibilities and obligations of the franchisor, that are applicable to your business and industry.
About the author:
Nick Empson is a qualified business coach, experienced franchise consultant and world traveller. With a passion for working alongside franchisors to help them take their business to the next level, he focuses on operations, vision, strategy, scaling up and international markets. Nick has 18+ years experience in franchising, including a significant tenure at a multi-award winning, global franchise brand seeing it grow from a dozen units in one country to over 330 units across 30 countries. www.levelupbcc.com
