I read an excellent article from the Franchise King, Joel Libava, that he wrote for the SBA website on what it takes to franchise your business. His article highlights various points including:
- Validating the idea
- Creating a system
- Marketing and sales
We also had some Twitter discussion regarding the fees and royalties that are paid to franchises. It really goes without saying, for a franchise concept to work you need to have profit margins that are large enough for the franchisee to make a good living, pay employees AND pay royalties and fees to the franchisor. But I think sometimes this is missed with certain franchise concepts. When my clients start franchises I encourage them to turn franchisees into raving fans of the concept and the business model. Make franchisees profitable. Do everything you can to make franchisees successful and the franchise will in turn be successful.