The first step to franchising success is the development of a prototype location. During this phase, the business model and operational standards for all future franchises are fine tuned and perfected.
Once the prototype is running successfully, the development of the franchise program begins. Everything needed to start franchising will be created at this stage, including:
- Operation manual development
- Training program development
- Business modeling
- Real estate market development plans and territory definitions
- Uniform Franchise Offering Circular (UFOC)
- Legal registration with state governments
- Franchise marketing and advertising
When the development of the franchise system is complete, selling franchises is the next step. Franchise sales can be a very lengthy process. The time spent seeking out potential franchisees with a compatible philosophy and financial resources will prove to be beneficial to the company as a whole as the business matures. In the first year of selling franchises, the development of a group of 5 to 10 franchisees is a reasonable goal to work towards.
The aim is to create a large enough group to build a firm foundation for the franchise, but not so many that it becomes difficult to communicate. In the first year, the initial group of franchises will find additional issues that will need to address before a full-scale national franchise launch. This step can be broken down to several parts:
- Finding Franchise Prospects (3-9 months)
- Sign Franchise Agreements (1-2 months)
- Finding Real Estate & Lease Execution (2-12 months)
- Space Build-out (2-4 months)
When the first group of franchisees have successfully duplicated the franchise model, franchising efforts expand. In the second year, the business will target an additional 10 to 15 franchises to add to the system. Once the franchise process becomes routine, a more aggressive national franchising effort for years three and beyond will be planned and implemented.
