Franchising a Business: Learn From Existing Franchisors
Learn from Those Who Have Already Expanded Through Franchising
In a recent franchise article on Business News Daily‚ Pierre Panos‚ the founder and CEO of Fresh to Order‚ explains what he learned about “franchising his business.” So here is what Mr. Panos has to say about the do’s and don’ts based on his own experience:
Ensure your unit economics work for you before franchising;
- Ensure you get a well respected business and franchise attorney familiar with franchising to prepare your Franchise Disclosure Document (FDD) and related paperwork – if not one unhappy franchisee could ruin the entire system;
- Start a franchise association early – franchisees are your partners‚ not your employees.
Don’t grow too quickly from a small base of stores to avoid losing control of your brand standards;
- Be very selective when accepting franchisees into your system;
- Don’t run out of cash – be fully capitalized when your business is in growth mode.
Evaluating Your Business
As a franchise lawyer and franchise business owner myself I am a big proponent of establishing a franchise system focused on “controlled growth” and Mr. Panos’ advice to treat franchisees as “partners.” There is a lot to be evaluated in Mr. Panos’ advice and many questions that you should be evaluating. So‚ what will your unit economics look like? What do you need to do to insure that your FDD and Franchise Agreement are developed to support future growth? What is your plan to turn franchisees into partners and raving fans?
How to Expand and Protect Your Business Through Franchising
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By Charles Internicola February 24, 2014
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