How would a smaller, lesser-known concept know if they should franchise?It depends on the person’s experience, but for us, what a franchisor brings to the table is his experience. One of the things a franchisee is buying, in a very soft way, is that the franchisor has made mistakes and survived it.
The franchisor understands seasonality. Companies come to us and say, “We just started and we spoke to this company in Chicago that thinks our concept is the next McDonald’s,” and we’ll say to them, “What happens in the fall when it’s back to school?” and they’ll say, “We don’t know.” If you don’t what you’re doing, if you don’t have experience, you’re guessing. But if you open a location where you’re at, open a location the next market over, two, three, four locations in different markets, run them for a year or two, and then franchise, that franchisor can answer franchisees’ questions based on experience rather than guessing. If you’re not quite certain, run your business a bit longer, because when the immature franchisor comes up against the multiunit, experienced franchisee, that franchisor can’t answer questions and is going to lose an opportunity that will never, ever present itself again.
domain on November 13th, 2005 at 3:23 am
hi,
i think:
How would a smaller, BETTER!-known concept know if they should franchise?
is the correct question
HTPC on August 7th, 2006 at 10:12 pm
Hello,
Befor you start to francise 2 years of exerience in the targeted market wouldn´t be enough. Mc Donalds started 1977 in Austria with one lokal. They had a very hard start and it took them 3 years to open their 2nd lokal in 1980. After heavy modifikations in their concept they get the market and MC Donalds Austria got the most succesfull depandance in Europe.
Nick on March 24th, 2007 at 7:28 pm
The problem sometimes is that people think everything can be franchiseable… Most of the time, these persons will think you can become a franchise in a matter of days, for a simple fee. NO! Franchising a business is a very long process and is very expensive!! (the average cost is about $100,000!!)