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DIY Franchising

DIY Franchising …. all you need to know A complete franchise package for next to nothing, save thousands of pounds – sounds great doesn’t it!? In reality, it isn’t.

A well-documented Franchise Operations Manual can help both the franchisor and franchisee do several things:

Franchisor:

  • Clearly identify the total knowledge that you have accumulated in your business
  • Lay solid foundations for future growth
  • Make your business more valuable
  • Create a standard for your franchise

Franchisee:

There are a few ‘consultancy’ companies offering ‘DIY franchising’ meaning that the potential franchisor is provided with franchise document templates and is left to fill in the blanks. With bold claims that this will save time and money; it is a temping proposition, but it is dangerously flawed.

Firstly, it makes the assumption that you have a full understanding of franchising…which really is very unlikely.

Next, one of the main reasons that DIY Franchising doesn’t work is quite simply that one size does not fit all. Every business and individual sector is different and therefore a tailored approach is needed – one error in a generic template could prove to be very costly!

When developing your franchise offering – to avoid costly problems with your franchisees you need to address every aspect of the offer, the support programme, and the legal agreement to make sure that you have an answer to every eventuality that may occur – a generic template cannot provide this. Nor does it give you access to the reality and experience of the franchise sector that a seasoned consultant can.

DIY franchising can lead to:

  • Generic ‘copycat’ legal documents, meaning the agreement is not tailored and also that a potential franchisee will possibly compare it with another brand they are considering thus weakening your strength
  • Insufficient financial analysis of the business, could lead to you losing money from the off .. or a franchisee not coming on board because the numbers don’t add up, or worse still they come on board then don’t make enough to get by so sue you or go out of business weakening your reputation
  • Inaccurately defined territories leading to clashes with franchisees later
  • Franchise Manuals that do not reflect the nature and ethics of the business
  • Lack of support for franchisees because there is insufficient understanding, leading to unhappy franchisees
  • Unhappy franchisees, who tell others and make it hard for you to recruit
  • More time and money spent putting the above right!

Why should you use a franchise consultant?

Having invested your time in researching the proposition you may be tempted to go down the ‘DIY route’. However, in doing this you leave yourself open to making the same mistakes as your competitors and risk damaging your business as a result.

Using a franchise consultant can eliminate these problems and take you one step ahead of the competition from the start. It really need not cost a great deal of money because we can tailor our work to mentoring and supporting you when you want to be more hands on.

Structure

The first thing your consultant will do is a feasibility study, which, along with his or her experience, will indicate the franchise structure that your company and, possibly more importantly, your management team will be able to work with and develop.

Next the franchise consultant will establish the most suitable structure for your franchise system. Franchises come in many shapes and forms – job franchises, master franchises, regional or area development franchises. All are suited to particular business types and cultures.

Fees

A significant challenge to overcome is the delicate balance of profitability that lies between the franchisor and the franchisee. Some franchises operate purely through mark up on products. However, if yours is a service business you will need to determine a management service fee that retains a fair profit for the franchisee and covers the support costs of the franchisor.

Your consultant will look carefully at your trading figures and will calculate projections both for yourself as the franchisor, and for your franchisees. The consultant will help you to make sure that both sides of the partnership will make a healthy profit in line with their investment.

Support

Managing a franchise network requires a certain amount of discipline. It is important that all franchisees receive the same level of support. The most effective way to do this is to create a complete set of support documentation that maps out the business systems clearly and is easy to understand.

Compiling this documentation, plus additional material such as text for your prospectus, then your detailed discovery documents and a briefing document for your franchise lawyer, are all components of the consultant’s work.

In addition, a consultant who is a British Franchise Association and / or Canadian Franchise Association (cfa) Affiliate will develop a bespoke franchising system based on your current business practices that meets the standards of the BFA / CFA in terms of profitability, processes and ethical practices. This gives you the edge when recruiting, and also is a must if you plan to be at one of the franchise shows in the future promoting your franchise because the Bfa sets out the criteria for accepting new brands into the show.

Conclusion

Engaging a British Franchise Association affiliated franchise consultant to work with you when setting up your franchise system will guarantee that your franchise network has the best possible start. Don’t be tempted to leave it to chance.

  • Focus on perfecting the product or service while employees do the day-to-day tasks
  • Hire staff with relatively little experience, as they can follow the tasks as outlined in the Franchise Operations Manual
  • Focus on marketing and sales
  • Deliver a high level of customer service

The next step, therefore, is to create your Franchise Operations Manual. A professionally written manual will ensure that your existing operation is best equipped to follow your proven business systems and procedures, and transfer them to franchisees.With over 30 years’ experience in this field, we would therefore like to take this opportunity to invite you to one of our offices so that you can see first-hand the quality of Operations and Training Manuals that have been produced over the years.This is also an opportunity to learn from open discussions with our franchise consultants and manual writers as to how you could best proceed from where you are towards achieving your business development goals.

 

Phase Three – Franchise Recruitment

Recruitment
Central to any Franchise Development Programme is the recruitment of suitable franchisees. With years of experience in dealing with both franchisees and franchisors across a wide spectrum, GMME franchise consultants are well-equipped to help identify the most cost-effective strategy.

Publications and Websites
We will recommend all relevant channels through which to generate franchise interest.

Expertise
Our skill and expertise offered is second to none in assisting businesses to grow and prosper through franchising. A professional approach, coupled with a complete range of quality services, has resulted in the successful creation of many new franchise businesses, the significant global expansion of established networks and the introduction of numerous franchisees to profitable and rewarding opportunities. For a business seeking to obtain membership of the British Franchise Association (bfa) and Canadian Franchise Association (cfa) the construction of the franchise must be performed with the requirements of its charter in mind.