Opening a franchise must be a well-considered and thoughtful project for it to be beneficial. All the Franchise explains you the guide to follow step by step.
To open a franchise, generally, there are 10 successive stages that take as a whole an average of 18 months to be completed.
10 key steps for franchising
Step 1: Understand the Franchise and take stock of your application
Before launching a franchise, it is important to know the definition and principles. Franchising is a network development model based on a collaboration contract between two companies: a franchisor and its franchisee.
It is essential in a second step to take stock of your project. The idea is to identify as close to reality as possible the obstacles to the project. These obstacles can be personal (family, finances, etc.), but also professional (gaps in certain areas). Faced with these obstacles, the balance sheet highlights your motivations, which must be solid, in particular to consider training yourself, spending less time with your family, committing your personal funds…
Step 2: Choose your Future Industry
There are numerous activities to be opened under Franchise, in fact franchising extends to all areas: catering, housing, food, etc. Knowing that if certain trades require a specific diploma, most do not require special technical skills. The field is, therefore, free to think about retraining. That said, this retraining can be envisaged in a known and controlled sector, or on the contrary in a sector which is attractive to the creator for personal or financial reasons. The available budget is also decisive in choosing the sector of activity.
Step 3: Market Research
Each geographical area has its own particularities. To give yourself the maximum chance of success, you need to know what’s missing in your city, your region before going any further. Unless you do know what the business would be like, it’s important to learn what the pressure on the spot is. If you are not especially attached to your zone, you may need to contact the franchisees who come within the boundaries of your range to help pick your potential establishment.
Step 4: Choose your Franchisor for the Opening of their Franchise
The choice of franchisor follows from the previous steps. Depending on the chosen activity sector (Food, Catering, Store, Real Estate, Personal services, Automobile), the available budget, the opportunities that arise in your geographic sector, etc., your choice will be oriented to some selected franchisors. For each of them, you must know if the concept is relevant, sufficiently original, sufficiently profitable, and be sure that the franchisee is well trained and supported. You must compare the official discourse of the franchisor by field visits to the franchisees of the brand. To do this, go to specialized salons where you can directly meet the managers of the franchises that interest you.
The entire Franchise helps you find the right franchisor in just a few clicks. If one or more networks interest you, you will be able to make a request for documentation online to obtain detailed information on these and then be contacted by the network developer of each brand
Step 5: The Forecast
The forecast includes all the elements of the market study and the accounting elements provided by the franchisor. Several assumptions are made to better anticipate potential difficulties. The high hypothesis is one that remains realistic if everything goes well. It is asked when viewing the figures made available by the franchisor. The median hypothesis uses the same figures with 20% less. The low assumption subtracts 50% from the high assumption. Ideally, the low assumption should remain if not profitable at least balanced, that is to say cover the expenses for the year (this is the break-even point).
Step 6: Complete your Financial Plan
Based on the estimated budget, you must know the minimum amount necessary to open your Franchise. This amount is partly covered by your contribution, the rest is to be sought from banking organizations, but also from assistance devices for creators (honor loans, deposit, exemptions from charges).
To have all the chances on your side when searching for financial projections, develop a business plan. You will thus determine the return on investment and your break-even point.
Step 7: Find your Local
Finding a location is a crucial time for opening your Franchise. It begins at the earliest in parallel with the previous stages but can only really be contractualized after the stage of the provisional budget and the setting up of the financing plan. In most cases, the research is personal. It can, however, be supported by the network. When an address is found, it must receive the consent of the franchisor. It is indeed the franchisor who will assess the qualities and constraints of the chosen location. An establishment survey confirms or not, the final choice.
Step 8: Choose your Legal Status
Depending on whether you launch your business alone or with partners, depending on the amount of investment made, you will have to choose a company status. Certain lighter activities can also be envisaged in the form of individual companies. Knowing that the level of protection of your wealth depends on your choice, it is better to get help from a legal expert who will advise you usefully on the different possible options and their consequences on your heritage.
Step 9: Open your Franchise
Last step, the opening of your Franchise is preceded by the initial training before opening. The franchisor is often very present upstream and downstream of the opening to allow the new franchisee to be able to calmly consider his first steps in franchising. Thus, the franchisee will be more confident in his new activity because the franchisor will be there to guide him, give him relevant advice thanks to his experience, and make his concept respected.