Ready to expand your small business? Consider turning it into a franchise.
Credit: Franchise image via Shutterstock
If your small business is growing rapidly and you're thinking about expanding it, you may want to consider turning it into a franchise. While many entrepreneurs are interested in purchasing a franchise to capitalize on a successful existing brand, being the owner of a franchised business has its perks, too: You can open multiple locations without being responsible for each one's day-to-day operations. Selling the rights to your business model and product also means that you won't have to bankroll the entire new location yourself.
Modman Enterprises is a Los Angeles-based branding, design and construction firm that recently helped turn two local businesses, Go Greek Yogurt and Kreation Juicery, into thriving franchise companies. Go Greek, a carry-out Greek yogurt shop, is scheduled to have its first franchises open in early 2014, while Kreation, a fresh-pressed juice bar currently has seven locations in the Los Angeles area.
While Modman founders Andrew Modlin and Adam Bierman played a huge role in the franchises' success by brokering licensing deals, scouting locations and securing permits, it was each company's high-quality product that got them to where they are today.[Franchising: Definition and Opportunities]
"Franchising is definitely difficult because it depends on your product," Modlin told BusinessNewsDaily. "If your product isn't good, you may have some success on your own but won't have a successful franchise, even if the design is amazing."
Based on his experiences with Go Greek and Kreation, Modlin offered the following tips for business owners looking to turn their startup into a franchise:
Be consistent. Your logo, store design and existing branding tactics make your business what it is. When you start planning your franchise, it's important to keep these elements consistent so customers will recognize your brand. With their recent franchising projects, Modlin and Bierman strove to be as simple and consistent as possible, while making each store slightly different.
Adapt when necessary. While your logo and design should stay intact, you may find you need to change a few things to make your franchises work. Your business, said Modlin, needs to evolve to meet what customers want in different places.
"For Kreation, the major thing for us to consider was packaging that would act as marketing outside the store, since so many people were getting juices to go," he said. "The changes came more in the materials used, and the idea was to make it look interesting while sticking with the existing design."
Be realistic. Is it realistic to franchise your business? Modlin said that many prospective franchisers aren't prepared for the cost and effort of opening a franchise, especially when it comes to scalability. Ask yourself if your current vendor and supplier agreements will work on a larger scale, and work out exactly how long it will take to make back the extra money you'll have to pay to get the franchise started.
Originally published on BusinessNewsDaily.