NFA Franchise Consultants
5Jun/18Off

Franchise Strategy

Franchise Strategy: Is Your Business 'Franchiseable'?

Stephen S. Raines
President, National Franchise Associates
Atlanta-based Specialists in Franchise Consulting & Franchise Development Success

Franchise StrategyIn my over three decades as a franchise consultant, I am often asked “What makes one franchise strategy succeed while another franchise strategy doesn’t?”

Rarely is there a single reason for success or failure in a franchise strategy.  Here, I will examine some of the many factors that can help you create a successful franchise strategy.

As a franchise consultant, when talking with a company that wants to consider a franchise strategy for growth, one of the first issues to address is what makes a business “franchiseable”.

There are a number of issues that make a company a good candidate for a franchise strategy.

Some or all of the following questions may apply when you are trying to determine if your business is franchiseable:

  • Can the business concept be duplicated?
  • Can you train the franchisees and their employees to operate the franchise in a reasonable amount of time?
  • How does the cost to open the business compare to the amount of money the franchisee can expect to generate over the first few years of operations?
  • How much direct competition exists?
  • Can you position your franchise strategy to create competitive advantages?
  • What size and type of market is necessary to support one of your franchises?
  • Is your franchise strategy dependent upon one or two vendors?  If so, does this reliance make your franchise strategy vulnerable?
  • Are any special licenses or advanced degrees required to operate your business?
  • Have you been in business long enough to prove the viability of your concept?
  • How complicated is it to open a new location for your business?
  • Does your franchise strategy have a relatively short life expectancy?
  • Do you have sufficient trained personnel to help you implement your franchise strategy initially?
  • What is the growth potential for your industry?
  • How challenging is it to find an affordable location for one of your franchises?
  • What is the likelihood that you can add additional products or services to your business, making your franchise strategy even more profitable for your franchisees?