How can I tell if my business is franchiseable?

Almost all businesses are franchiseable except for those that are likely to have a short shelf life because they are a fad or because they are of a highly technical nature which it would be difficult to teach franchisees. That of course is not to say that it would be a good idea to franchise your business.

Generally the most successful businesses are those that can be easily replicated subject, of course, to extensive guidance and help from the franchisor. Further franchisees – who usually have no knowledge of the particular business to be franchised – must be able to be taught how to operate their business without complex and lengthy training.

If you believe that your business may be franchiseable there are a number of steps that you must take:

  1. First your existing business must be profitable. Franchising cannot turn a failing business into a successful business.
  2. Secondly, you have to put all of your knowledge, expertise and systems into a document which is referred to as the operations manual and which will be made available to franchisees.
  3. You have to pilot your business. What this means is that you have to allow someone to operate your business as if it was a franchisee. In this way you can establish whether the success of your existing business is dependent on your “brilliance” and, if it is not, whether it can be replicated.

Written by: John Pratt

Partner, Hamilton Pratt