When Is The Right Time To Franchise Your Business?

"To Franchise Or Not to Franchise - That is the Question." Shakespeare? Not exactly, but it underscores a question that many business owners ponder. Should you wait until you have four or five units open and operating profitably, "Slick" as a Whistle? Or should you move "Quick as a Wink" and aggressively attack the market, start selling and franchise now?

"Quick" versus "Slick"? That is the real question. Wait too long and the window of opportunity may close. Blunder into the market too soon before you are ready, and you could self-destruct. What to do?

Our 27 years as franchise consultants, observing the successes and failures in the franchise industry have driven home some points, which may provide the answer for you based on your individual situation.

SLICK
1. If you have a concept that is going to compete with large, well developed companies with significant market share, who have significant buying power and advertising dominance, then you need to be very "Slick" before you venture into franchising. You need to "have your act together" with all systems, procedures, unit designs, products and services clearly delineated and competitively poised to survive and hopefully prevail against "the big guys".

QUICK
2. Everyone remembers that Charles Lindberg was the first person to fly across the Atlantic. CAN YOU NAME THE SECOND? CAN ANYONE? If you have a new and different concept or a major point of difference between what everyone else is doing, and especially if you are in a fragmented industry with no major competitors that have large market share, then it is more important to be "Quick" than "Slick". Being first with a new idea is really important.

Subway, McDonald's, Midas, Holiday Inn, KFC and Ace Hardware paved the way in their industries to aggressively franchise. There were other companies like them, but no one aggressively franchised as they did. Yet, none of those companies were highly sophisticated when they rolled out, and they used the cash flow from franchise fees and royalties to continue to upgrade and improve their concepts.

Is your business ready for Franchising? Take the Franchise Quiz!