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Chuks who is an entrepreneur always believed in his small business In Nigeria. for a frozen yogurt outlet, but in 2014 he actually quit his job, put his family’s savings on the line and opened Chuks Yogurt. Three years of hard work, late nights and seven-day workweeks taught Chuks a lot about running a startup, but the investment paid off. Today, business is booming, and last year Chuks opened a second outlet in a strategic location. Lately, Chuks and his wife have been talking more and more about whether it is time to take the leap into franchising.
They know that starting a franchise involves risk, but so did creating the first Chuks Yogurt outlet, and look how well that turned out. It is hard to put away the idea of franchising — there is so much money to be made! They’d be crazy not to take a profitable business to the next level and make Chuks Yogurt a global name, right?
If running a lucrative startup is the equivalent to crossing an uncharted ocean and finding Treasure Island, then turning that business into a successful franchise is the equivalent to launching a rocket into deep space and landing on Jupiter. It is very possible, but with limited supplies and no sure bets, entrepreneurs have to understand and accept the serious risks, enlist the help of experts and prepare for a long-haul journey. Here are five questions they should be asking themselves along the way.
Initiating a franchise requires a lot more than a great business concept. Entrepreneurs need to understand exactly what their brand is and does, and articulate the concept and plan. Franchises are about systemization, so entrepreneurs need solid, organized outlines for operations, communications and methods for franchisees to attract new customers. Entrepreneurs must clearly describe every facet of branding and mode of operations to everyone, from investors to potential franchisees.
Chuks is involved with parent organizations, his church and school sports teams, and both of his stores are within walking distance of two major high schools. Before Chuks jumps into franchising, he has to examine whether his company could be a homerun anywhere, whether it is easy for entrepreneurs to underestimate how much value they personally add to the business. But, for a company to translate into a thriving franchise, it has to be able to survive the day-to-day challenges and do so without the entrepreneur’s personal touch.
Even though Chuks is a fantastic salesperson and balanced business owner with plenty of skills, but a franchisor has to delegate. Building a successful franchise brand means keeping every franchisee on the same page, with unified business systems; and not one person can do that alone. Chuks Yogurt will need experts who specialize in a range of industries, including public relations, advertising, graphic design, equipment and support, training and legal issues. Chuks has to partner with the right players and empower others to take on tasks, while managing the process alongside a core corporate leadership team.
Before he even thinks about getting started, Chuks needs adequate funds. Franchises cannot get off the ground without abundant cash flow, and if the franchise flops, it could all vanish. People often look too hard at the potential earnings without considering the potential loss.
Entrepreneurs should expect to have investing partners as well as a personal financial stake in the venture. Costs will quickly multiply for brand development, courting potential franchisees, compensating experts and especially covering legal fees. (NEVER EVER underestimate the legal fees.)
Big dreams are the foundation of every triumph story, but they can sometimes cause financial ruin. In order to franchise, entrepreneurs have to be visionaries who believe in their product, but they also need to seriously examine whether their vision is possible in the real world. Franchising requires commitments on every imaginable level over the long haul. Before Chuks takes the plunge, he should gear up for months of preparation, implementation and late hours. In the end, if he partners with franchise experts, he will succeed in scaling and expanding his business globally.
Contact Franchise Business Development Services (FBDS) today. We are the pioneer franchise consulting company in Nigeria, the country representative of World Franchise Associates (WFA) and a supplier member of International Franchise Association (IFA). We are on a mission to making franchising the preferred business venture model in Nigeria, as a strategic means of building sustainable businesses that operate best practices.
FBDS is the pioneer franchise consulting company in Nigeria, the country representative of World Franchise Associates (WFA) and a supplier member of International Franchise Association (IFA).
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