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How to scale up a small business with franchising

How to scale up a small business with franchising

For small business owners, franchising is a way to expand more quickly and cost-effectively than opening further company outlets

Owning a small business or launching a start-up has always had its challenges. But never before has there been so many unpredictable highs and lows and constant changes. The effects of the pandemic on business have been widely spoken about but for some entrepreneurs, they have used this time to build back stronger.

For small business owners, franchising is a way to expand more quickly and cost-effectively than opening further company outlets. By allowing franchisees the right to run their own business under your brand and systems, you can transform your own business and grow your brand.

Many sectors suffered coming out of the pandemic. However, new ways of working have exposed new needs and many people are now considering franchising for the first time. The franchise sector is worth a reported £17b to the UK economy and according to the British Franchise Association reports, there are more than 50,000 franchised business in the UK, creating more than 700,000 jobs. Worldwide, through quick adaptability, scalable technology and a strong focus on products and services, the franchise sector has shown its resilience and is set to grow by at least 10 per cent this year.

In the UK, there is a new appreciation for franchising. ‘Being in business for yourself, but not by yourself’ has resonated now more than ever. However, deciding to franchise your business is not a straightforward decision.

There are certain criteria that you must meet: is your business proven and can you show evidence of success? Is it profitable? Is it teachable to others? Is it transferable to different locations? You must also ensure that a number of legal safeguards are in place to maintain brand control and protect your asset.

To successfully answer these questions and navigate this new territory, businesses can look to a specialist franchise marketing agency. Some even have an integrated sales call centre like Franchise My Business. Led by co-founder and franchise development director, James Cotton, who has more than 15 years of experience in the franchise industry, his team provides a hands-on leadership service to help businesses move into franchising.

“We work with a wide range of small businesses to help them franchise and hold their hands throughout the entire process and beyond,” says James. “The pandemic meant a lot of people lost their jobs so there are a lot of experienced individuals who are currently out of work but who have tons of knowledge. Deciding to franchise now gives businesses the edge over their competitors because they can recruit the best talent on the market.”

A perfect example of a business that didn’t let the pandemic stop its growth is Revolution Records, which launched in 2016 and franchised in 2020 with the help of Franchise My Business. It is a well-known and respected record retail shop and has already generated a huge amount of interest from potential franchisees with two new franchisees recently signed up and James is working on a development plan with another three.

“We simply would not be where we are without Franchise My Business and James and his team,” says founder of Revolution Records Brian Keay. “They have not only produced quality leads through Ben’s marketing experience but have dealt with prospective franchisees in the most professional way. The feedback I have received from franchisees is that queries that they have had have been dealt with quickly and expertly. We have been able to secure two franchisees already since coming out of lockdown.”

Brian chose to work with James and his team because of their knowledge of the industry as well as their demonstrated capabilities in marketing and software.

“They own a franchise recruitment CRM system software which has app-based interaction abilities and project management software that delivers each franchisee through the getting into business process as soon as they become a franchisee.

“This helps us guide our franchisees and helps us manage their future scale. James has been guiding us by setting up a bespoke franchisor development plan which we use as a guide, plus communication is detailed and regular,” explains Brian.

One of the points of difference that Franchise My Business offers is the company uses technology and the latest resources to deliver the best results for clients. “Our model differs in that our success is aligned to your franchise sales, so we are a true partnership, both striving for your future profitability,” adds James. “We work with a wide range of sectors and this fresh approach to franchise development focusing on results and revenue for our clients has led to many long-term partnerships.”

For other businesses considering taking the leap into franchising, Brian from Revolution Records says: “We think this is an excellent time for small businesses to consider franchising. Lockdown has forced many people to reconsider their way of life, moving out of the rat race and making their working life enjoyable by working for themselves with all the backup a franchise provides.”

How does Franchise My Business evaluate if a small business is ideal for franchising?

James Cotton: We evaluate small businesses in various ways. We carry out an assessment by going through a Franchise Readiness Questionnaire of the business. The questions focus on several different areas including the trading history of the business, profitability of the pilot model and how well that pilot has performed.

We carry out a detailed look at that specific industry and to see if there are any competitors in that space. If there is, we investigate their performance figures and compare them against their model.

There is a detailed look at the operations and franchise infrastructure. Are the operations franchise-friendly and can they provide enough guidance to support any incoming franchisees? Franchise My Business provides their clients with the tools to ensure that once a franchise has been sold that there is a clear pathway in getting that franchisee into business. There is nothing worse than having franchisees and then not having a detailed plan of what to do after they have signed up.

Any business wanting to franchise, should think about their model and ask themselves these questions:
• Can the business be easily copied?
• Do you have the right structure in place to support a franchisee?
• Can you commit the time to the process of franchising?
• Has your business been trading profitable for a minimum of three years?
• Are there competitors in your industry marketing already as a franchise? And if so, what makes your business unique?
• Does the business believe they have the capability to franchise?

Not every business can be franchised, the management capability is as important as the model. Franchisors will need to be logical, clear and concise on their ambition as well as having the ability to coach and educate.

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