Franchise ownership is a great opportunity for everyone involved in the investment. It’s even better if you can be the franchise owner, licensing out rights to own individual locations to other investors. Before you launch your franchise brand and begin seeking investors to open locations, there are a few key preparatory steps to take. That way, you will be ready to support licensees who buy in to your chain.
The first thing to do is to set up an accounting standard. This makes sure all the locations you personally open are running consistently. It also makes it easy for you to train new entrepreneurs who have not run a business before, and when you audit your licensees for quality control purposes, it makes your job easier. Along with that, you’ll want to start a resource center. Franchise ownership is about ensuring the success of each person who buys a license, because they are representatives of your brand to new audiences. A digital resource center with all the important management standards and practices, as well as updated advice to cope with the changing business environment, is a great way to do this.
It’s also important to remember that starting a franchise is a lot of work. Most of your locations might be run by franchisees, but you need to be involved in quality control, vetting new investors, inventing new marketing strategies, and improving supply lines. All that work only happens with hands-on owners, so if you’re looking for a business opportunity that will let you make easy money on your investment with a minimum of effort, it’s time to move on.
Once you’re ready to help franchisees get started, you also need to make sure you’re in compliance with all state and federal laws. SilverLink Funding’s Business Finance Managers are experts in this field, and can provide additional information when you sign up for one of our franchise financing appointments. If you plan on allowing licensees from other states to buy in, you’ll also need legal advice that helps you ensure you are in compliance in the new territory before you move in. If all that sounds like more work than you planned on when you first got the idea to start a franchise, then you should consider the alternatives. There are other ways to structure a chain business and make it grow, and with a more linear hierarchy, it’s easier to hire management and delegate authority downward. Franchise ownership requires you to be much more hands-on with recruitment and growth for the entire brand, not just the locations you own.