Twenty years ago in my country, the Dominican Republic, franchising concept was known by very few. There were no lawyers or consulting firms to help you to structure a successful plan. So I learned by trial and error! This is the worst way to learn, if you can avoid it. Save time and money, and most of all, do not risk your concept to go out of business before you learned the right way to develop your dream. You also have to have in mind your responsibility to ensure your business model meets the criteria to be successful, as you have franchisees trusting your brand.
One scenario is to have 2-5 stores selling well, and another is to embrace a race to expand the model without the proper business plan to support a rapid expansion. Believe me on this one. Don’t do it without hiring first a consulting firm to help you to structure your business platform and review the legal aspect.
Below are some of the main points a consulting firm will prepare for you to secure a proper Franchising Platform.
1- First, select the consultant’s firm and discuss in detail issues related to your strategy for franchising. When selecting the firm, ask for clients references.
2- The firm will prepare a Concept research and Review of your business.
3- A senior Consultant should visit your operation, review the operational characteristics, and provide the recommendation on different topics.
4- The Franchise Business Plan will include:
-Determined Initial Franchise Fees taking consideration several aspects such as initial investment, training, advertising, commissions, site and start up assistance.
-Royalties. Based on what you need to maintain sufficient corporate cash flow.
-Advertising Fees.
-Evaluation on Territory program to determine on whether or not franchisee needs an exclusive area or territory.
-Franchisee support program.
5- The firm will draft and give to the attorney (choose one specialized in franchising) to review an Individual Franchise Agreement.
6- Disclosure Document. This document will have information, prepared in the format according by UFDD.
7- Franchise Registration and Filings. The firm will submit the application required by each state’s regulatory agencies.
8- Prepare a Franchisee Operational Manual.
9- Develop The Franchise Marketing Plan.
10- Franchise Sales Training
11- Franchise Management Training. This will include a list of critical information such as procedure on Franchise Relations, Franchisor Compliance, Training your Franchisees, Providing Effective Field Support.
12- For further information on franchising, finding a consulting firm or business opportunities in Networking, feel free to contact me at my email listed below.
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