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How to start a franchise business


So. You want to know how to start a franchise business. Suppose you have already weighed all the pros and cons. Therefore, we will tell you how to approach the basis of such a case. And avoid mistakes that can spoil the result of all the efforts spent.

What you need to know about franchising

Statistics show that in recent years more than 80% of enterprises are closed during the first five years of their existence. In this regard, most businessmen quite reasonably try to protect themselves. Especially at an early stage. And signing an agreement with a well-known brand to work on its behalf is an ideal way.

By itself, a franchise is an agreement that is concluded between the entrepreneur and the owner of the trademark.

Thanks to the franchise, even inexperienced businessmen can take advantage of the name of a popular brand. And do not worry about the possible risks of opening a new business.

Although it is useful for many to open their own franchise business, not only in order to minimize risks. But also to enlist the support of experienced businessmen. Because almost any company that works according to this scheme provides entrepreneurs with consultants. And already they help them to develop their business in the chosen territory.

Because it benefits everyone. The better each individual institution works, the better its image. And, of course, the total profit.

Franchise types


The best solution for beginners.

Collaboration in this vein provides full support from the brand. The right holder provides the franchisee with assistance at every stage of opening a business. But at the same time requires full compliance with the rules of the company.

This approach helps to save yourself from all sorts of risks and mistakes. Because the entrepreneur, in fact, becomes part of the company. But he occupies a leadership position with great managerial potential.


This option is often preferred by more experienced investors. Especially if they have extensive experience and know how to quickly promote their own business. There are only conditional rules here. And the franchisee fully manages all affairs.

With substitution

This option will be the best solution for those people who managed to acquire their own supplier base. Or limited in the choice of materials and equipment.

For example, if a person has his own enterprise, which is located in some remote region, you can use the technologies of a large brand. But at the same time choose your own suppliers.

Ready-made enterprise

The easiest way to make money.

But it requires a significant investment. A full-fledged business is transferred into the hands of a novice entrepreneur, which has a promoted name and well-established work. And, of course, all the necessary documentation.

In order not to make a mistake, be sure to study the contract as carefully as possible. To understand what kind of cooperation option is offered by the chosen franchise.

And when you decide what type of cooperation suits you, instructions on how to open a franchise business will come in handy.

Choose direction

Decide in which direction you are going to work. If you already have an idea for franchising, feel free to implement it. If your goal is not to do business in any particular area, but simply to ensure a stable income, then domestic experience shows that the most successful in the market are various catering enterprises, as well as the service and retail sectors. Over time, the popularity of well-known gyms, educational institutions and real estate organizations is also growing.

Carefully study the franchisor

If you are interested in the business of a really famous and large company that values ​​its reputation, it is unlikely that it will hide any information. Be sure to talk to other franchisees and do not be embarrassed by the negative experience of some subsidiaries, since today, in principle, there are no completely successful franchises. At the same time, if you see that the subsidiaries of the brand are working very successfully, this is already a pretty strong argument in favor of cooperation.

Communicating with other franchisees, you can ask what kind of support they were provided at each stage, and what difficulties arose in the process of developing their business. At this stage, it will be possible to note for yourself a positive moment if the franchisor has its own department for working with entrepreneurs.

Write a business plan

All companies that value their own reputation carefully approach the choice of entrepreneurs for the role of franchisees. In this regard, it is difficult for newcomers to open a business in reputable companies, as they may consider their intentions not serious enough. In this regard, it is important to correctly draw up your business plan, indicating in it:

  • introduction, where the attitude to the chosen type of business will be disclosed;
  • contact information;
  • own experience in running such a business, highlighting the most profitable moments of their activities;
  • a plan for promoting products, taking into account the characteristics of demand in the selected area, numbers, ratings and other useful information;
  • location, if there is already a property in which the business will develop;
  • base of suppliers, if the franchise does not provide for the provision of such entrepreneurs;
  • a financial strategy indicating the amount already invested in the business and planned investments, taking into account possible force majeure and reserve funds to respond to them.

A competent business plan should always be with you during a conversation with the franchisor.

Draw up a contract

In the current legislation, the concept of "franchise" is absent as such, and such a business operates under a commercial concession agreement. In this regard, the contract should always be drawn up with the support of a qualified lawyer who will help eliminate all pitfalls, as well as protect the entrepreneur from fraudsters.

how to start a franchise business – get started

When the contract is signed, the entrepreneur can enjoy any privileges that the brand provides for business owners in its network. The franchisor can provide a whole team of professionals providing advice on various issues. Franchisees often receive all the strategic and marketing plans of the company at their disposal, as well as support in promoting their business and recruiting qualified employees. In some cases, entrepreneurs even receive the necessary equipment from the franchisor.

If support from the company was not provided (which is often found in the current market), then you will need to act as follows:

  1. Transfer all necessary papers for branding to the franchisor.
  2. Finalize the paperwork for running your own business.
  3. Rent a room, if this has not been done before.
  4. Set up an office. Many franchisors issue a design project, but you can often develop it yourself.
  5. Draw up contracts for the supply of necessary equipment, its installation and maintenance.
  6. Recruit and train employees.
  7. Check and sign contracts with suppliers of all necessary goods and raw materials.
  8. Finally open the business by starting production and officially starting the operation of the enterprise.
  9. Promote your own business in accordance with the marketing plan.

If you correctly approach the design of a franchise business, you can easily and without serious effort start working in the market, providing yourself with a stable profit. The most important thing is to pay attention to all the details at every stage. Do not think that some aspects of your business are petty, because in the future they can turn into serious expenses.

Post source: kakzarabotat.net

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