Want to spread your network at a rapid pace? The only way to achieve this feat is by franchising your business model. Once you agree to the franchise system, you can easily open new outlets at different locations. However, it is imperative to understand the roles of the franchisors and the franchisees before agreeing to sign the contract.
Before discussing the roles and responsibilities, let’s understand the franchise system-
Introduction to the Franchise System
When you’ve decided to franchise your business, you have to find out whether your business model is ready to franchise. If your model provides you with profitable returns and generates lucrative revenues every fiscal year, you can franchise it now. Otherwise, you have to work on your existing firm and make it ready before entering into the said system.
Some entrepreneurs hire franchising consultants to put the right foot forward. As they are experienced enough, they will help you understand the franchising agreement. In general, it consists of three main elements that include the details of the contract fee, royalty payment, and the tenure of the contract. So, both franchisors and franchisees must read it thoroughly.
Role and Responsibilities of a Franchisor
Once you signed the agreement, you will be responsible for providing necessary training to the team of franchisees. It is also imperative to provide them with ongoing support in the business. To make things effective, you have to promote your brand using adequate tools and resources for reaching the targeted audience. Also, you have to respond to the queries of the franchisees related to the business model and technical difficulties with products/services.
Do remember that your brand reputation is linked to every outlet whether it is franchised or not. So, you have the overall responsibility for managing things.
Role and Responsibilities of a Franchisee
After agreeing with the franchisors, you have to follow the business model strictly to replicate the same. It is imperative to work according to the business model to ensure that customers get the required products/services. In this process, it is the sole responsibility of the franchisee to hire talented staff for running the firms. Here a collective effort of the dedicated team members is going to meet the business goals as a whole.
Although you could have ideas for advancing the products/services, you can’t implement them directly. So, you have to share the same with the franchisor and act jointly.
Final Thoughts
When you prefer franchising your business, do your homework. First of all, you need to make yourself familiar with the franchise system. In this context, this information might have solved many of your queries associated with franchising a business model.
Did you know? Reputed franchisees only make agreements by evaluating the profitability of running a business model. So, you are advised to experiment with your business before you franchise. Or else, you can hire a professional consultant to understand the said system. It might take a little time to find a reliable advisor; however, it helps eliminate any errors.
This is how you could replicate your business model successfully.
James Corne is a reputed market analyst. She has been providing advisory services to business owners for the last 18+ years. She is also a blogger. In her posts, she prefers writing on the need for franchising your business, the importance of hiring franchising consultants, and many more.