Even the biggest multinational company has humble beginnings. Many of the brands and companies that are known all over the world started as a small family business. A number of these companies have achieved success after they have franchised their own businesses. Thus, if you dream of becoming big and successful all over the world, you might consider franchising your business.
Before you get excited over the prospect of franchising your business, however, you should first consider if your company is ripe to undergo such a big a step. Your business is ready for franchising if it possesses the qualities enumerated below:
Longevity and Size
Many experts believe that your business is ready for franchising if it has been operational for at least three consecutive years. However, if your business concept is hot and really good, you can start franchising it even if you just celebrated your first anniversary.
As for size, your business should be big enough to be able to attract other investors. People who are in the look out for business to franchise want a company that has a proven track record of success.
Transferability of Concept
In order for your company to be a successful franchise, your business concept should be easy to duplicate. People who buy franchise do not want complication or difficulties, so you need to organize your system and concept first, before you even start thinking of franchising it. Remember that the success of your franchisees will also depend on how well they will able to replicate your system and concept.
You also need to know if your business can easily be adapted to different locations and countries. If your business is highly localized, it may be quite difficult to set up a franchise of your company elsewhere.
Profitability
How will you able to convince other people to buy your franchise if you company is not making money? Before you even start thinking of franchising your business, you must already have a consistent record of financial success. You have to take note that your people are interested in earning and making money; thus, if you cannot assure them that your concept and system is profitable, it may not be the proper time to franchise your business.
Marketability
Before even thinking of franchising your business, you have to consider if your concept or business idea is easily marketable. Many companies decided to franchise their business when many prospective investors were the one clamoring for franchise deals. You will know that you are ready for franchising, market wise, if your customers are the ones who are already asking you to franchise your business.
Affordability
One of the things that prospective franchise buyers will look at is the cost of their initial investment. Higher investment needed to operate your business, will mean fewer people will be interested in buying your franchise.
Aside from the cost of the franchise and business operation, many possible business partners are also considering their return on investment. If you can assure that their return on investment is high, many will be interested in franchising your business.
Originality
One of the things that you should consider, even before opening up a business, is whether your company offers something new to your customers. Originality sets you apart from your competitors. Thus, a business concept that is unique is very attractive to potential business partners and something very important if you are thinking about franchising your business.
Once you have ensured that your business satisfies all these qualities, you are already ready to consider franchising your business.