4 Major Mistakes to Avoid While Franchising Your Business

What drives most successful entrepreneurs to choose franchising as the preferred mode of business expansion? Well, it’s because the chances of success are pretty high if all the things of establishing your franchise chain are being done strategically. In order to ensure that you are on the right track of attaining success as a franchisor, you must follow a step-by-step method while avoiding some of the most common mistakes.

To evaluate these mistakes, you need to know what does franchising your business actually mean and ‘how do I franchise my business’ by imbibing a development process while focussing on a set of realistic, specific, and attainable goals. For a detailed understanding on the probable mistakes made by most franchisors during establishing their franchise chain, read till the end of the article.

Not identifying the thin line between role of a business owner and franchisor

As a business owner your primary task is to deliver good products or services to your customers. If you excel in doing the same, you are likely to increase your customer base, thereby boosting your revenues. But as a franchisor you need to have the will and zeal to coordinate with multiple franchisees while offering them the necessary knowledge on business structure for helping them establish franchise units across varied locations. A franchisor needs to go through the tedious task of searching and recruiting competent professionals as his franchisees. He needs to draft the entire blueprint or guidebook for offering adequate training to them along with other important resources. This is the reason it is always recommended to seek expertise and guidance of a franchise consultant.

Not understanding that they aren’t ready for franchising

Timing has always been a determining factor for success or failure of a franchising business. Dreaming or aspiring big is definitely good but you shouldn’t have unrealistic goals. As a wise entrepreneur, you must evaluate your business processes, revenue, financial position, and infrastructure to understand whether it can be reproducible easily. Doing so will also help you understand whether it is the right time to jump into the world of franchising or you should wait for a while. Always remember everything needs to be properly sorted before you step into the mode of franchising your business to secure your chances of attaining success.

Not having a proper plan

Working without a plan doesn’t make any sense at all and thus, you must have a well-defined, objective-focussed plan before getting started. It is essential to prepare a comprehensive booklet of instructions to guide you. You should be clear of your objectives, line of processes, location-specific market demand of your products, and services and more. Also, you should have a proper idea of what kind of professionals are you willing to appoint as your franchisees (including their experience, interests, strengths, and weaknesses). Maintaining all your work process as per the plan is all you need to act efficiently.

No having sufficient capital

Often franchisors (mostly start-ups) fail to understand the difference between the FDP, i.e., Franchise Development Process and getting their Franchise Disclosure Document (FDD) prepared. Resultantly, they fail to plan the budget properly for both the development phase and the post-launch activities related to franchise sales process. So, without adequate budget, they simply cannot prepare the legal document FDD and that’s how things turn upside down for them.

Key takeaway!

Mistakes are meant to happen but with such kind of serious financial implications involved, you need to be extremely careful while making every move in the process of establishing your franchising business. Thus, always take professional help of skilled franchise consultants on ‘how do I franchise my business’ as they have the right knowledge and expertise needed for dealing with the entire process with utmost precision.