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Franchising can be a fast, low cost and effective method
of expansion if it is undertaken in a professional, structured
manner. However, if you quickly "leap" into franchising
on a trial and error basis, your do-it-yourself approach will
likely end in disaster.
Developing a profitable franchise program requires knowledge,
skill, talent, and experience.
| Some of your concerns should be: |
- What package of services should you offer your franchisees?
- To what extent do these services need to be developed?
- What operational structure is most appropriate
for your franchise expansion?
- What organizational requirements are needed to
implement this structure?
- What controls, methods, reporting systems, supervision
and assistance are needed?
- Who is the type of franchisee best suited for your
method of growth?
- How do you best recruit, qualify, select, train,
and motivate your franchisees?
- In what market areas do you intend to franchise
and why? What amount of market penetration is needed?
- What should you charge for a franchise fee, royalty
and advertising assessment? What is the justification
for these charges?
- What are the various state and federal requirements
regarding franchise agreements, disclosure documents,
registrations and filings? Are there concerns about
anti-trust laws, SEC requirements, and various other
federal and state laws?
- How do you develop your operations manual and design
your training programs?
- What marketing and advertising program is needed
for you and your franchisees?
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By addressing these and other concerns and planning carefully,
you can eliminate many costly mistakes, blind alleys, legal
pitfalls, and incorrect assumptions.
If you do not have the experience, knowledge, and skills
necessary to develop your own franchise program, what are
your options?
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