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A Step-By –Step Program to Franchise Your Business

The Franchise Launch Program

Franchising is all about business development, growth and expansion. Franchising and the process of successfully franchising your business, requires a strategic plan and a proven step- by-step process. The goal is not just franchising your business or meeting the legal requirements to sell franchises, but to build a franchise system that, from the very start, takes advantage of the very best practices in the franchise industry, is strategically focused on enhancing the strengths of your business, minimizing its weaknesses and establishing a flexible but rock solid foundation that is designed to create, scale-up and grow your franchise system.

The franchising process needs to be about you, your business and your goals and it also needs to be realistic and grounded in the very best practices and strategies that are proven to work. After that, franchise success all comes down to execution and a process of learning and succeeding. Our process – the franchise launch process – is all about creating franchise systems that to their very core are designed to create strategic franchise success.

The Franchise Launch Program is a process driven franchise development program that takes real world experience and the very best franchise industry practices and strategies in the development of franchise systems that scale-up and grow. The Franchise Launch Program allows start-up and emerging franchisors to compete and grow at a national level.

Our Franchise Launch Process

1. The Franchise Assessment: Is Your Business Franchisable?

Since franchising starts with you, your business and your goals, the first step is to determine if franchising is even right for you and whether or not your business is franchisable. Before we get started on a new project and working with a new client we start with an initial franchise assessment to determine if we believe franchising is the right fit. To learn more about the franchisability of your business and the factors that we will evaluate, review our 5 Franchisability Factors.

2. Assessing Your Business and Brand

One of the biggest secrets to franchising is that, as a business and legal model, franchising is extremely flexible and when done correctly must be unique to your business and goals and must differentiate your new franchise system from competitors. To do this, we evaluate you business and brand – their strengths, weaknesses, competitive advantages, unique selling points, legal protections and future development goals – and throughout the franchise launch process we focus on developing a franchise system that best meets your development goals and that will maximize the scalability of your franchise system.

3. Competitive Franchise Study

As a franchisor you competitors will be other franchisors and franchise systems. Some of these competitors will be in the same industry as you and others may be in a different industry but nevertheless compete with your for prospective franchisees. To establish a baseline, we prepare a competitive franchise study to evaluate and compare the metrics associated with three comparable franchise systems. We don’t do this to copy these competing systems but, rather, to understand them and to create a baseline when considering who we can structure your system to stand out and offer better unit economics for franchisees. Our competitive study serves as a great baseline and point of reference throughout the franchise development process.

4. The Franchise Blueprint

Establishing and creating a franchise system is very much a process that evolves over time. Once we understand you, your goals, your business and your brand and after completing our competitive franchise study, we create a blue print mapping out the structure for your franchise system. Our franchise blueprint documents core development goals and development metrics, including:

  • Franchise fees and establishing a franchise fee structure that is competitive and encourages potential multi-unit development;
  • Royalty fees and establishing a royalty fee structure that rewards franchisees for success and one that achieves your growth and development goals;
  • Multi-Unit opportunities and whether or not your franchise system will be focused on single unit franchise opportunities or multi-unit franchise opportunities with development agreements;
  • Territory sizes, whether or not franchisees will be granted operating territories, how to manage franchisee operating territories and forms of protection that may or may not be granted to franchisees;
  • Proprietary products and sources of supply, including the identification of core products and services that must be purchased from your or your designees and whether or not you may generate additional revenue from your suppliers; and
  • Many other factors, including factors unique to you and your business and our strategic plan for differentiating your franchise system, attracting franchisees and attracting potential franchise broker interest in promoting your franchise offering.

5. Brand Protection

As a franchisor your brand and the legal protection of your trademarks are critical. We evaluate your core intellectual property including the protectability of your trademarks and we will file registration applications with the United States Patent and Trademark Office for the federal and nationwide registration of your trademarks. If your trademarks cannot be registered or protected we will have a candid conversation and work with you in assessing and evaluating alternative trademarks and branding. To learn more about your trademarks and franchising, click here.

6. Developing Your FDD

Your Franchise Disclosure Document (FDD) is and will always be the core legal document from which your franchise system will be created and your franchise sales activities will revolve around. Although a legal document, your FDD must be grounded in a strategic franchise development plan (our franchise blueprint) that creates and promotes the unique characteristic of your business and that advantages that franchisees will be afforded by your franchise system when compared to competitors. We prepare a FDD that reflects a flexible and competitive franchise system that is designed to grow and one that is prepared on a multi-state basis and capable of registration throughout the United States in the franchise registration states.

7. Developing Your Franchise Agreement

Your franchise agreement will be a part of your FDD. They must provide you with the very best protections and must be structured and focused on strategic growth. Depending on our strategic planning goals, your franchise agreement may not be just one agreement. Your franchise system may be structured with multiple development opportunities where a franchise may sign a franchise agreement giving them the right to establish one unit or they may be offered a franchise agreement where they are granted the opportunity to establish multiple units. Your franchise agreements need to reflect your franchise system and must be designed to facilitate franchise sales.

8. Corporate Structuring

When establishing a franchise system you will also be establishing a new corporate entity. That is, to protect your existing business operations and for a number of franchise development reasons, we will be working with you in establishing a new franchise company, i.e., Your Company Franchising, Inc. Through a number of discussions with you and your accounting and tax advisors we will select the right state of formation and the right type of corporate entity. Also from a development standpoint we may establish additional corporate entities including a entity to own and protect your trademarks and intellectual property, i.e., Your Company IP, Inc. The point is that the franchise development process must include a coherent corporate structuring process and working together we ensure that it is structured right and done right.

9. Advisor Consulting

Throughout the franchise development process we will be working with your other advisors. Whether your long-term accountant, new accountant, your current lawyer and even your estate planning professionals. Our services very much include working with your existing team of professionals and, if requested, educating them about the franchising process and working together.

10. Launch and State Regulations

Franchising involves both federal regulation and state specific regulation. When preparing your FDD we focus not only on the federal law but also the state specific laws and the 13 franchise registration states that will require us to register your FDD prior to offering or selling a franchise in those states. When we establish your franchise blueprint, together we will identify strategic franchise registration states and we will register your FDD within those states. We understand the franchise registration process very well, we understand the focus that state regulators place on certain strategic FDD disclosures and we are always focused on doing things the right way at both a state and federal level. Your system will be compliant and ready for registration. Learn more about the franchise laws and where to your FDD will be filed.

11. Post Launch Consultations

Although you know your business really well, franchising will be a very new business for you. The franchising process also includes a learning process and one of the greatest values that we provide to our clients is sharing our real world experiences with you and working to leverage our industry know-how to your competitive advantage. So, after we launch we include a number of scheduled post-launch conference and education calls.

Afterward and for those who may not of initially launched there franchise with us, we offer our Franchise Counsel Program which is an on-going franchise representation and franchise development program. The Franchise Counsel Program is all about providing on-going support and best of all it is offered on a monthly fixed fee basis and puts our clients in full control about the services they need without obligating them to a contract. The point is that we are always there for you.

If you are already a franchisor or have had your FDD prepared but it is not what you expected and is not working for you, you can learn more about our Franchise Counsel Program.

Charles Internicola

by Charles Internicola
National Business and Franchise Lawyer

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