You started a business and it has become a huge success.  People are coming from all over to get your product.  You have the system that works.  Everyone is telling you to expand.  Starting another outlet seems like a great idea but you know you that would take attention away from the home store.  Then someone mentions franchise.  The concept of franchising your business would be the perfect answer.

If you would like to franchise your business there are some things to consider.  The first step is to take an honest look at your business.  You may be making a killing at what you do. The profits may be through the roof.  Ask yourself why. Determine if it is a fad or if your business will always be in demand.  Once you can justify selling the idea and concept to an investor you can analyze whether you should franchise your business.

You must be able to address key issues any potential franchisee may ask about.  The first one will be your credibility.  You are selling an exact copy of your business.  The buyer will want to know that you know what you are doing.  They will look at how long you have been in business, and how much knowledge you have about business.  The prospective franchisee will see that you can run your business but will ask if you can support a chain of outlets.  In other words you will have to sell yourself first and the business second.

When you decide to franchise your business, look at the marketability.  You may have the best shrimp tiki hut on the island but it may not be a good business venture in the mountains of Colorado.  If the business is seasonal or limited in where it would be popular chances are you should not try to franchise your business.

In order to franchise your business another question you must be able to answer is why the prospective franchisee would want to buy from you.  The package must be more attractive than the other franchise opportunities on the market.  This could be because of pricing, the concept, or the market you are targeting.  The prospective franchisee will want to have a unique product or service that is marketable to a special interest group.  The franchise package that you are putting together may not contain all of these elements.  However, if you are able to include as many of them as possible at a fair market value you will have clients.

The only way that you will be able to franchise your business is to make it a smooth running operation that can be learned quickly.  Any prospective franchisee that would have been interested will quickly walk away from a business model that they can not understand or would take months of training to learn.  When you franchise your business you must look at how you do things and how you would train someone else to do it.  You must never neglect even the slightest duty.  You may take it for granted that the first thing you do in the morning is start the coffee pot.  The prospective franchisee does not know that a large portion of your income is based on the 6:30AM coffee rush.  You are selling a replica of your business. The most minute detail must be included in the business model.

One other thing that you will definitely need to look at when you franchise your business is the profit margin.  The prospective franchisee will want to know that the business will still make a substantial profit after royalty fees and other operating expenses.  There must be a good return on the investment for the franchise to be worth buying into.