13 February 2007

Do you want to franchise your business?

Franchising is the most successful and proven method of expansion and growth for good businesses in Australia. Not only do franchisees contribute most of the start up costs necessary to expanding into another business location they also bear the responsibility for those necessary evils of business, which are so demanding, such as: Human Resources, OH & S Operations, Marketing, Customer Relations i.e. THE LOT! Don’t get me wrong, as a responsible Franchisor your role is to assist your franchisees with these challenges, but haven’t you already been through them in the first place? The difference in a franchise situation however is that instead of having to do all the work from scratch again yourself, you teach and show your franchisees how to do it themselves.

Not only that, franchisees don’t need too much motivation to do what’s necessary to make their franchise successful, it’s their business why should they need any more motivation than that?

A lot of business owners don’t understand the level of sophistication in the franchising sector today; they still think flipping burgers and mowing lawns is the extent of the franchising world’s circle of influence. This couldn’t be further from the truth. The number and variety of franchise networks that are operating and, by and large, succeeding in today’s challenging business climate would stun most business people. Take a look at the professional services: legal, accounting, banking, consulting (marketing, IT, HR, etc) engineering, architecture, project management, financial planning, design and technology – all franchised! Likewise with the trades; plumbing, electrical, construction, building, renovation, landscaping, etc, all franchised.

Part of the reason for the stellar growth and success of Franchising in Australia and Internationally is that it can be adopted in any industry or business; it traverses all boundaries. Think of any business and I’ll bet you can find a franchise network offering similar products and services.

Of course, whether the franchise business is successful or not depends upon a number of things such as: whether or not a good business was franchised as opposed to an indifferent or poorly performing business, the manner in which the business was franchised – quickly and carelessly or thoughtfully and thorough, and how you the business owner understand and adapt to your new role as a teacher and mentor and your success in supporting your franchisees to name a few.

Part of the magic of franchising, which interestingly enough is also one of the challenges of franchising, is the infinite potential that can achieved by people sharing common goals and interests i.e. the franchisor and franchisees. Just have a look at some of the biggest companies in Australia; you might be surprised that most of them have embraced franchising in one way or another. When an actor says “what’s my motivation?” a director might give him some background so that he can give a good performance. Franchisor don’t have to motivate their franchisees to achieve the same thing, the franchisee should be on with the program 200%.

As I mentioned, the challenge for the Franchisor is harnessing what might be a large number of people’s motivation under the same umbrella and channelling it to achieve the best results for all. Therein lies the skill. I have yet to find the franchisee that did something to deliberately harm their business. I have encountered a great many who, with the best intentions however, have achieved just that, not only for their business but also for their fellow franchisees.

A good franchisor needs to be a good leader, much like a good business owner. You lead your charges through the unchartered business world and make sure that everyone stays on board for the ride and doesn’t take the wrong direction. Ask yourself the question “if you have done this in your current business with your staff, might you be ideally suited to doing this with franchisees?”

In a nutshell, if you have a good business and want to expand it, you have got some runs on the board and survived the business world for several years, the next question you have to ask yourself is “can I show someone else how to run this business as well as I have?” If the answer is yes and you are prepared to invest some time in developing the framework, you should consider franchising. Oh by the way, did I mention that successful franchise networks make money, lots of money!

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For more information about franchising contact Kathie Heyman and Geoff Ingram from the Hunter Franchise Centre – www.hunterfranchise.com.au

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