Do you want to franchise your business? Not sure how to start? Here is more in the series. We are exploring the world of franchising from the basics at the beginnings. For the first part in this series click here How do I franchise my Business?
Is My Business Ready to Franchise?
How do you know if your business is ready to franchise? There are a lot of different factors. It can depend on the type of business; the length of time you have been in business, your financial situation. In short there are many variables, but let’s see if we can answer a couple more of the basic questions.
Profitability of your business
We looked at the basic aspects of this in the last blog Basics 1. Obviously this is the most important factor. If you have looked at the profitability of your business and you are “on the money” then great! If, however it is not quite up to speed, have a serious think about getting independent advice and help.
- Get a business coach (please, hear me on this one – get one who has experience with small business.)
- Get advice from your Accountant. Your accountant should be able to help you analyse your figures.
- Best option if you are serious about franchising – get a franchise consultant.
When you go to see any professional for advice – listen to what they say, ask as many questions as you can. Remember YOU ARE PAYING FOR A SERVICE. If you feel that they do not understand your business or you feel they are not helping guide you in the right direction – GET A SECOND OPINION. Please do not be intimidated by business professionals – they are there to help you, if you feel they are not – find someone who can.
What makes you different from your competitors?
Another aspect to look at is, do you have an edge on your competitors? What you are looking for here is something that makes you stand out from the crowd. Better products? Faster service? Whatever it is, this may become an important selling point. This does not mean you have to be cheaper. Your edge might be that you give your staff better training so they are much more helpful to customers and you have a high rate of return custom. It could be that you have easy to understand services or a niche market that loves your products.
Now if you are scratching your head saying I don’t really know what would make us stand out from the crowd – ask your customers why do they come to you! That should give you a better understanding. Some businesses don’t have to have a huge competitive edge; they are just everyday businesses that people will frequent as long as the service is good. What you ask?? Here is an example, newsagents, people don’t shop around before they go there to buy (………usually!), so long as they are well stocked and offer good services people are less likely to go elsewhere. So in short, whatever your edge you must ALWAYS have good service.
A good way to find out where you sit in the market is to find out what your competitors are doing. Make sure you keep an attentive eye on your competitors to ensure you keep track of what is really
happening. I have found so many business owners have an awful habit of thinking they know what is going on without even checking. They have in their minds what happened last year, 5 years ago and
that doesn’t really matter much, it is what is happening now that counts more – check.
- What are they doing in the market?
- What is their portion of the market?
- Who are they targeting?
- How often do they change, add, alter etc. products/services?
- What is their advertising/promotion like?
You can always learn a lot by looking at your competitors advertising. Remember when you are franchising you need to be competitive not just in your city, town, suburb etc. but wherever you are looking to expand to.
Once you have established where you really fit in the market the next thing to do is to ensure that you keep moving forward and keep up to date with your particular market.
About the Author: Sara Howell is a no nonsense, straight talking Franchise Consultant & Small Business Specialist at Business Bubble. If you have any questions or just need some help – call 1300 293 239.