What is Franchise Management?
If you are looking to take your startup to the next level or expand your already established
business, franchise management is the way to go.
The right mix of dedication and hard work and a franchise management system can transform your business prospects into an international success.
Let’s begin by understanding the term ‘Franchise Management’ first. The word ‘Franchise.’
refers to the licensing for establishing particular trade, merchandise, business, or private enterprise, provided by a company to a team specializing in franchise management.
Franchise management, in turn, deals in leading the entire process of conducting this business.
The franchisor holds the trademark for the company and lends it out to the franchisee over a license agreement for further business.
How to start a Franchise Business:
If you have understood the concept of franchise management, and you feel inclined towards
growth, both professionally and expertise-wise- you are at the right place!
Here, we will run you through a walk-through guide explaining the exact process.
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Explore, test, and analyze
Research, research, research!
If there is anything we can’t stress enough, it is the need to know the game before diving into it. It would be best if you kept toiling to know fully and understand before throwing your money.
As rewarding as it is, a franchise business can be tricky unless you are confident with your knowledge and strategy.
Analyze the success of similar franchises, study your target audience, make sure you are ready to bear the relatively large initial expenses, get all the relevant legal affairs in order before the venture.
It takes firm will and perseverance, but it eventually pays out very well.
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Establish your budget
Franchise Management is no joke when it comes to investments.
The franchise can demand anywhere between $20,000 to $50,000 as the primary deposit. Depending on the type of franchise, the annual cut to the franchise owner or company can vary. It is often a set percentage of the gross revenue obtained every month.
Besides the licensing fee, you require funds for building a professional team and renting
out or buying the location of the branch. Prior homework is your best friend here.
For the initial investment, you might have to apply for a loan. This is where your research and business knowledge comes in!
You must calculate your gains and losses before starting.
Moreover, it is crucial to determine the estimated monthly revenue and its expected growth after obtaining the license for the franchise. This will help you plan the paying off of the loan.
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Hunting for the best location
According to the criteria laid out by the franchising company, as a franchisee, you need to
appropriately look around for the location of your business.
Typically, the franchisor plays a role in helping to select an appropriate site.
It’s essential to take the traffic at the site into consideration. You must make sure if you can
hit the target audience with the location.
Afterall, it all comes down to how many customers you win.
Your budget is also a significant factor here. Whether renting or leasing a site or buying
land, you need to be sure it meets your budget.
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Sign the contract
Once you’re well-informed on the fundamental idea and skills, it’s time to step forward and sign
the contract with the franchising company.
It’s always a good idea to keep your lawyer on board with the legal agreements and deals. Make sure you intelligibly understand all the legal aspects before officially signing the documents.
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Train, hire, and build your team
Depending on the degree of specialized training required, a massive chunk of appropriate business skills and knowledge will come from the franchising company.
The franchisor will transfer the necessary information, including demographics, customer service, sales data, and the overall business strategy.
Then comes the moment you start hiring and building your team – hence the franchise
management!
Open calls for hiring and start interviewing the team officials. Remember, you and your franchise business are essentially what your team collectively has to offer.
Make no compromise on professionalism and work ethics.
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Start the journey!
Location, team, expertise- everything is sorted. Now what? Open up for business!
With the right blend of marketing especially bringing in the necessary flair via social media, and
professionalism, your business would do wonders.
If you stick to your marketing strategy and establish customer confidence, making it big in no time is a given.
This is the very time you’ve been waiting for.
Congratulations! You are now a franchise owner.
Make the arrangements for the big day. This is your time to shine; make it remarkable and memorable.
Advantages of Franchise Management:
We have been babbling about the rewards of opening a franchise business. Let’s look at the rewarding aspect.
This brief list of the advantages of franchise management is worth a look:
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Creating your brand name
The brand name goes on to benefit both the franchisor and the franchisee.
Expanding your business as a franchisor means lending out the brand name while keeping hold of the trademark.
The more well-spread the franchises are, the more awareness and exposure your business or company wins. This is essentially free marketing!
As a franchisee, you draw huge advantages from any marketing campaign run by the franchisor. People trust the brand name, and if you have what it takes to be a successful franchisee, customer return and loyalty will speak for themselves.
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Risk control
Since the franchisor is not involved in direct employment and renting/buying of a location; he
doesn’t have to worry about the loss of funds there. The franchisor can simply overlook the franchise’s management process.
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Fast growth
Franchise management systems generally tend to grow exponentially and much quicker than company-owned individual units. This helps both the franchisor and franchisee in increasing
the annual revenue.
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Shared capital requirements
Franchise management adds to its popularity by providing a system where the franchisor doesn’t need to take a considerable capital risk.
The franchisees fully share the capital investment. In addition, the franchisor keeps benefiting from the monthly percentage cut from each franchise.
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Better management
Since the business is split into multiple small units, the administration is easier and much more effective.
The staff fulfills the need to be professional and cater to all the franchise’s customers effectively and efficiently. A smaller unit promises more sales and substantial financial returns.
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Secure business
Multiple franchises make franchise management a massive industry.
In turn, it generates enormous profits and is essentially seen as a safe business power. Any losses can be easily overcome, and investment can be spared for improvements.
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Garnering support
If a particular franchise requires any help in sales or business expertise, the manager can always reach out to similar franchises for suggestions and guidelines. This makes franchise management a unified and protected system.
Tips to boost your franchise management:
Whether it’s a part of your extensive pre-launch research or you are on the run for improved
franchise management- these tips are sworn by franchise managers themselves. It’s definitely worth your time.
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Plan beforehand
It doesn’t matter if you’re yet to set up the franchise or are already running it; you need to plan
at all steps.
And keep planning! Have all the legal affairs in order, don’t run out of necessary resources, keep training and improving your team’s professional conduct.
If you have the idea big in your mind, it will translate way bigger in reality.
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Network
As a franchise manager, it’s a massive part of your job to connect and network. Build a bridge
between aspiring franchisees and the already buddy franchisees.
Keep your franchisees happy and satisfied, and they’ll themselves serve as remarkable
marketers for your business.
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Ask for feedback
While staying connected to the franchisees, involve them in your business and marketing
plans. Take them on board with all company decisions.
This builds trust and makes the process rewarding and significant for the franchisees, ultimately leading to much more significant financial gains and benefits.
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Invest in improving
The idea of improving should be as important to you as expanding. Bear in mind that
businesses run on customer return and boosts, so before taking up a new expansion
project, evaluate the existing franchisees and invest in improvement.
It doesn’t have to be big chunks of funds; a little goes a long way.
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Reward systems
To keep the franchisees inspired and driven to serve better, establish reward systems.
Acknowledge achievements and milestones and make sure you’re rewarding them alongside.
Again, this massively contributes towards building trust and better professional and working relationships.
Conclusion:
Here’s the thing: franchise management is no child’s play. It requires hard work. Quite a lot of it. However, if you believe you have what it takes, you are already halfway up there.
By this, we mean to stress the sheer necessity of will, expertise, and dedication.
If you do your research and network effectively, the rewards can start pouring in in no time. This is your cue to utilize this guide and further your knowledge in franchise management. Best of luck!
