How to Franchise
Your Business
Speaker:
Tony Fitzpatrick
Managing Partner
www.franchiseyourbusiness.ie
What is a franchise?
A franchise is a licence to use a proven
business system, its brand identity, its
operating procedures, marketing procedures,
advertising procedures, training programmes
and its support framework.
What is a franchise?
The franchisee’s own personal flair, their
unique entrepreneurial skill, energy and
commitment are added to reap the full benefits
of the franchise.
Studies show at more than 90% of franchised
businesses are successful compared to 55%
of non-franchised business set ups.
Terminology

A Franchisor is the original developer of the
business

The Franchisee is the investor who buys the
right to trade under the brand using the
Franchisor’s concept
Franchising
Some of the world’s most successful
companies are franchises. The owners
realised that franchising offered key benefits
such as;

Unlimited growth potential, attracting
franchisees instead of hiring employees

Expansion without huge bank borrowings, or
having to share equity

Long term stability and predictability of the
business model

Rocketing revenues

Boosts the value of the business
Franchising

The USA has 3,000 Franchisors. A new
franchise opens every 8 minutes of every
business day

1 in 12 retail outlets is a Franchise,
generating 18 million jobs and an annual
payroll of $500 billion

It accounts for 40% of all retail sales in the
USA
Franchising

The number of Franchisors in the UK
exceeds 700 with 35,000 Franchisees
employing 333,0000 people and generating
annual sales of £12.2 billion.

The Lebanon has 150 Franchisors
Franchising
Franchising provides an opportunity to work
for yourself, but not by yourself.
By owning an operating a franchise you are
investing in a proven method of doing
business where all the problems associated
with start up business have already been
ironed out.
Franchising
Franchising provides a proven system to
follow.
That’s S.Y.S.T.E.M as in
“Save Yourself Time, Energy and Money.”
It gives a structure to follow. Franchisors can
only be successful if their franchisees are
successful.
This makes for a win-win relationship that is
unique in the business world.
The Market for Franchisees
Thousands of people are looking to start their
business, be their own boss, and pay
themselves what they’re worth. They include:
People who have been made redundant
 Current employees
 Second incomes

Redundancies
Dramatic effect of recession. Large numbers
of people losing their jobs. They can:



Stay unemployed
Start a business, or
Buy a franchise
Many of these people lack the skills or
confidence to start their own business.
Only alternative is to look at franchising.
Second incomes
Big increase in the number of people unable
to work full-time but need additional income
because partner lost job or family income
has been reduced.
Franchising can solve their financial
problems.
Current employees
Job security is history. Wages and bonuses
are reduced. Any job is at risk.
People look to control their own destiny and
franchising can be the answer.
They can be their own boss, work what hours
suits them, and benefit directly the more
successful they become.
How you make money from
Franchising



Mark up on product you sell to franchisee
Percentage of franchisee’s gross sales
Flat monthly fee
Is your business suitable
for franchising?
Ask yourself these questions:




Have you run a successful business for at
least one year and preferably two or
three?
Have you proven your concept?
Will it survive in the long term?
Is it profitable?

Can you produce audited accounts?

Do you operate in a niche market or offer
something different in an established field?

Can your business be replicated and easily
taught?

Can you offer leadership, strong
management, motivation and support?
And …
Can you offer a franchise at a cost that is good
value for money and can make a decent return
on investment in the short to medium term and
a good living for its owner?
Benefits of Franchising
As a franchisor you can expand your business
- and your income - more rapidly and at less
risk using other people’s money.
When you award a franchise you are creating
an income stream from royalties or
management fees for the foreseeable future.
Benefits of Franchising
Profits are higher because your costs are
lower.
You’re working with motivated business
people who will bring creative, innovative
ideas to the franchise.
The psychological element…
You are helping others to achieve their
dream of achieving financial independence
by showing them how to establish and
operate the business you created.
The 10 key questions to ask yourself
before you go into franchising
1. Do you work well with
others?
One of the greatest skills you will need to
succeed in franchising is the ability to work
effectively with other people.
2. Can you accept and manage
risk?
To franchise, you invest time and money in an
endeavour which has an element of risk. You
must be able to understand the nature of the
risk and to manage it.
3. Are you single minded?
The ability to stay the course and commit to
the long term is a big advantage in franchising,
which is a long and involved process.
The determined and focused franchisor is
often the successful one.
4. Do you have a strong ego?
You must believe in your dream and have a
confident personality in order to build
enthusiasm and interest in others.
Franchising is a high profile undertaking.
5. Are you a good salesman?
Salesmanship is critical to franchise success.
Growth depends on finding suitable prospects
and then selling them on the benefits of your
business.
6. Are you a good
communicator?
So much of franchising involves
communication that a system that does not
facilitate the free exchange of information is
doomed to failure.
7. Are you an entrepreneur?
An entrepreneur sees potential where others
see problems, and opportunity where others
see only obstacles.
The entrepreneur identifies real needs in the
market and commits the necessary effort to fill
these openings.
8. Are you hard working?
Getting a franchise off the ground is a
significant undertaking.
It takes time and effort, which translates into
work.
9. Are you adaptable?
The ability to adapt to constantly changing
circumstances is a necessity in a multi-faceted
industry such as franchising.
10. Can you afford it?
You need to be in franchising for the long haul.
So prepare for it. Franchising is not easy, and
it’s not cheap. Building your new business
takes time and patience.
How to Franchise
Your Business
Speaker
Tony Fitzpatrick
Managing Partner
ww.franchiseyourbusiness.ie