How to Franchise a Startup: 4 Tips for Success


If you run a successful company that offers valuable products or services to consumers, you might want to open other locations to reach a larger audience. Not only will you earn a higher profit, you’ll also help countless new customers while you build your brand from a distance.

Instead of owning and operating all the locations yourself, you can offer your business model as a franchise opportunity, and allow other hardworking entrepreneurs to run each establishment under your brand name. Here are four expert tips for turning your startup into a franchise.

While you likely researched your target consumers and location before opening your business, you’ll need to investigate further to familiarize yourself with the world of franchising.

“A company that is franchised is built and operated entirely differently than most businesses,” said Brian Tollefson, CEO and founder of Tikiz Shaved Ice & Ice Cream. “Before making the decision to franchise a concept, it’s crucial to … fully understand the franchise business model. Many don’t realize the time commitment and effort it takes to franchise a company, in addition to the costs associated to properly do it.”

Franchise fees can be overwhelming, but they’re crucial to developing your brand and a network of owners, said David Busker, franchise consultant in the FranChoice national network.

“They must be competitive with other brands in your industry and category as well as other franchises with similar total investments,” he said. “Qualified franchisees will be comparing brands not only among categories but even different industries, and the fees can be a meaningful part of total costs.”

Busker added that most fees range from $25,000 to $50,000 per unit, with discounts for multiple-unit owners or regional developers.

Before hiring any franchisees or even considering opening an additional location, ensure that you also have the right documents and agreements in place:

The franchise agreement exists so you and your franchisees are on the same page. Busker noted that it should be legally sound and not dependent on the franchise location

“You might allow things specific to a franchisee to be negotiated, like territory, credit or other items normally handled in an addendum,” he said. “But to maintain a brand, all of your franchisees need to be signing the same agreement.”

Αποτέλεσμα εικόνας για franchise

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