Why would I want to franchise?
There are three main reasons why you would want to franchise your business:
- Better use of your skills
Better Use of Your Skills
Personnel managers have a guideline: “In your first year on a job, you will learn 80% of what you are ever going to learn about that job.” If you have been operating the same business for years, you know virtually all you will ever know about it. You still have challenges. However, when you face those challenges, you are usually applying the same knowledge to different situations.
You have developed skills in your field. Franchising lets you put those skills to good use teaching others, for a profit.
You may have one outlet of your own, or you may have a dozen. At some point, you are simply stretched too thin to operate efficiently. You must rely on others to fulfill the goals of your organization. If the “others” you rely on are employees, employees come and go. In franchising, the “others” are owners of their own businesses. Nobody cares about a business, works harder at it, and has a greater interest in maximizing its revenues, than its owner.
Franchisees will usually pay you royalties and other fees. Franchising helps ensure that the people who have the most incentive to succeed are the ones who pay you money.
Franchising lets you earn revenues from multiple sources. As noted above, most franchisors earn money from royalties and providing other value, such as training. However, there are other sources, including:
- The lease of real estate to franchisees
- Developing the franchisees’ sites
- Selling products and services to franchisees and to the public
- Charging fees for services, such as site selection assistance and other benefits you provide to the franchisee
Here’s the point. Using your skills, maximizing efficiency, and earning money are why you went into business in the first place. Franchising lets you do all three, better.