The Rise of Franchising in Nigeria

Across the globe, franchising has emerged as a robust business model, offering aspiring entrepreneurs a tested blueprint for success while providing established brands with an avenue for expansion. In Nigeria, this model has gained popularity due to its potential to mitigate the risks associated with starting a business from scratch. However, the Nigerian franchise scene was not without its challenges, which include but are not limited to regulatory hurdles, amongst others.

FBDS Nigeria, an abbreviation of Franchise Business Development Services Nigeria, recognized the untapped potential of the franchise system in Nigeria and embarked on a mission to address the existing challenges. Spearheaded by Mr. Chiagozie Nwizu, FBDS has taken the helm in reshaping the franchise landscape within the nation.

1. Customized Approach to Franchising: FBDS Nigeria understands that a one-size-fits-all approach doesn’t work in a diverse market like Nigeria. Over the years we have pioneered a customized approach that takes into consideration local market conditions, cultural nuances, and economic factors. This approach not only enhances the chances of success for franchisees but also ensures that franchisors can adapt their business models to suit the Nigerian market.
2. Educational Initiatives: One of the significant barriers to entry in the franchise industry is the lack of understanding of the model’s intricacies. FBDS Nigeria has been ardently engaged in enlightening potential franchisors and franchisees about the merits and challenges of franchising through our diverse webinars, training programs, and our affiliated institution, the Africa Franchise Institute. At FBDS, one of our primary objectives is to demystify franchising and equip individuals with the insights they require to make judicious decisions.
3. Regulatory Advocacy: Navigating the regulatory landscape can be a daunting task for franchise businesses in Nigeria. FBDS has taken up the mantle of advocating for a more franchise-friendly regulatory environment. Through collaboration with governmental bodies and policymakers, we are diligently working to foster an ecosystem that champions franchising as a viable business model while safeguarding the interests of all stakeholders.
4. Local and International Networking: FBDS understands the power of networking in the business world. We have created platforms for local and international franchisors, franchisees, and service providers to connect, collaborate, and learn from each other. This networking approach not only fosters knowledge sharing but also opens up new avenues for partnerships and collaborations.

FBDS Nigeria undeniably stands at the forefront of redefining the franchise landscape in Nigeria by confronting challenges head-on and offering ingenious resolutions that empower both franchisors and franchisees. Our tailored approach, enlightening initiatives, advocacy for conducive regulations, and networking avenues are collectively shaping a robust and sustainable franchise ecosystem in Nigeria.

                                                 FBDS – Nigeria’s leading franchise experts

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Small Business In Nigeria: Am I Able to Franchise My Business?

FBDS welcomes the opportunity to meet successful business people keen to expand their companies through quality franchising. Contact us now to find out how our franchise management services could help you.

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.

1. Can you clearly define what your brand is?

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.

2. Can your business be replicated?

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.

3. Small business in Nigeria: Are you willing to consult franchise experts?

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.

4. What is the true cost of franchising?

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.)

5. Is your vision for expansion realistic?

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.

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Franchise Business Development Services (FBDS) is the pioneer franchise consulting company in Nigeria, a franchise services supplier member of International Franchise Association (IFA). FBDS goal is to “To be the leading Partner in the development and delivery of successful franchise service in our chosen markets which of the Profitable business ideas in Nigeria.” This can be achieved by building successful and scalable businesses through franchising – a proven business expansion model with 85% success rate globally, 95% success rate in South Africa.

Looking at Nigeria economy situations, SMEs have been facing with many challenges; most common of them is financing. Franchising(Profitable business ideas in Nigeria) helps here because; it has been proven in Nigeria, just as at other countries, that businesses operating the franchise model have the least failure rate because they are proven businesses. This makes them attractive to fund providers who cannot risk lending to start-ups.

Another way franchising helps with access to finance is that it helps a business seeking expansion to access funds at no interest from investors seeking opportunities to own a profitable and proven business, this why franchising is a Profitable business ideas in Nigeria.

These investors are called franchisees, who obtain a right or license under the franchisor whose proven and successful business model they leverage to own a replicated business set up 100% at their own cost. Through this licensing, the franchisor entrepreneur who could have been having difficulty sourcing expansion funds will have access to grants or bank loans to expand their brands.

So why are most Nigerian entrepreneurs yet to begin taking advantage of the franchise business model, a truly and proven Profitable business ideas in Nigeria to own and expand their businesses?

In spite of the evident successes of franchising, there have been low adoption of the franchise business model in Nigeria. Previous studies conducted in Nigeria by Franchise Business Development Services (FBDS) sadly point to the fact that many Nigerians either have no idea what franchising means, or they conclude it is an idea of working for another man to build his business.

Quite agreed that there are people who are entrepreneuring and are ready to meet up and deal with the challenges of building a successful brand, but most people are better off with managing their own business under an established brand with proven business system which is what franchising is about, because it is tough to build successful business in Nigeria today.

These misconceptions fueled by lack of education(Africa Franchise Institute AFI now educate people on franchising and business expansion)  and awareness resulted in the underdeveloped state of Nigeria franchise industry compared to other economies such as South Africa, where franchising contributes as much as 14% to the GDP. 

Our advice to entrepreneurs, especially considering the massive failure rate (over 80%) of SMEs in the Nigeria, is to take a closer look at franchising. First by paying attention to the numbers and fact that do not lie, about the new trends that franchising is creating in Nigeria.

These trends are how growing businesses are leveraging franchising to replicate their success and expand; how franchising is scaling and creating sustainable job opportunities; How by franchising, entrepreneurs can access single digit fund to start-up a new business; That there is ease of introduction of skills, knowledge transfer and standardization to new businesses;

How the culture of independence is now gradually giving way to collaborations, leading to increasing leverage of proven successful brands built by other entrepreneurs to own new businesses.

FBDS provides end-to-end franchise consulting services to companies seeking to expand or Profitable business ideas in Nigeria through the franchise business model, helping them do develop a franchise programme for investors and franchisees. FBDS services includes matching the franchise businesses with suitable investors who desire to own a business leveraging the proven and successful business models built by the franchise brands.

FBDS also supports the two categories of entrepreneurs with a range of advisory services and technology solutions. franchise a business, local/ international companies who are already franchising and want to expand to other territories, and entrepreneurs aspiring to buy a franchise.

Contact us today. We are the pioneer franchise consulting company in Nigeria, 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 and Profitable business ideas in Nigeria.

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One notable industry sector that perfectly fits in the franchise business model is the Finished Leather Goods (FLG) sector. Almost every home in Nigeria and the world at large make use of leather products. The aesthetic appeal of wallets, shoes, bags, clothing, furniture and other finished leather goods (FLG) remains a desire for most of us which is a great Franchise Opportunities for everyone. According to the International Trade Center, leather and leather products are among the most widely traded products worldwide. It has been estimated that the international trade exceeds US$ 80 billion annually, this is expected to continue growing alongside the increase in population and urbanization of developing and emerging countries.

Franchise Business Development Services (FBDS) in a recent study have explored the Franchise Opportunities in finished leather goods (FLG) sector in Nigeria, considering that recent studies have shown that over 80% of SME businesses shutting down in less than 3 years of doing business. Nigeria have a large market with a population of over 175 million people.

In the FLG sector, there are over 100,000 experienced artisans operating from the Aba cluster and a number of other clusters, which have been existing over the past three decades. Despite the lack of automated assembly line production processes, informal studies indicate that artisanal producers are still able to churn out significant numbers of finished leather goods, with an estimated minimum daily production value of NGN 45,000,000 from at least 75,000 finished leather product items and these goods are often traded through informal trade routes to domestic and neighbouring regional markets – over 60% of products are estimated to flow to the foreign markets.

A huger potential is however foreseen through interventions that would increase domestic consumption of locally produced items, by linking the outputs from the artisans to be marketed and retailed by high-end retail chain brands which had indicated vested interests, such as: Roban Stores, PEP Store, David Wej, School Kits and Mr. Price. These Franchise Opportunities would create the needed structure for the items to be accepted, marketed and sold competitively in the country. And the best proven sustainable method of rapidly expanding these businesses with almost 0% failure rate and with guaranteed revenue growth is through franchising.

Below are 7 key highlights of our findings while exploring franchise opportunities in the finished leather goods (FLG) sector;

1. There is a common understanding among all interviewed stakeholders that there is a major opportunity created in the FLG sector, especially with the foreign exchange rate which has made locally produced goods more price competitive; government increased support; and awareness of the need to patronise locally made products to strengthen the local economy.
2. It was widely observed that most MSME business owners in Nigeria have little value for building enterprise development and management capacity. Where there is knowledge transfer through some sort of franchise or technical partnership between such entrepreneurs and an established corporate brand or foreign technical partner, without further hand holding or on-going support, there are alarming cases of high rate of eventual business failure due to the failure of the new owners to apply discipline in diligently maintaining the set standards and procedures. This is the key reason why the franchising business model is probably the most ideal for actualizing sustainable change and growth in the sector.
3. Limited capacity to make finished leather goods that compete with the foreign ones in quality, finishing and packaging, limited access to suitable finance, lack of accessibility of the few good quality products, trust issues due to fear of watering down brand standards by franchisees, and limited awareness of the franchising concept were mentioned as key challenges to employing Franchise Opportunities in the FLG value chain. The actors in the value chain are mostly fragmented, consequently, there is much loss of opportunities that would have been secured if there were necessary collaborations and linkages.
4. The majority of operators in the sector being micro and small business owners, have difficulties meeting up the requirements for bank funding, most of these operators fund their ventures with own funds from personal savings. There is a wide expectation that franchising would widen the opportunities for funding interventions from local and international financial institutions, FDIs, and government special funding interventions.
5. Franchise business (Franchise Opportunities) model is barely known among the targeted artisans in the sector, however with illustrations, the respondents who could relate with the franchise concept from their knowledge of some common franchise brands across different industries, indicated excitement and willingness to benefit from the opportunities of knowledge transfer, and perhaps securing licenses to operate as franchisees of the franchisor. All franchisors and potential franchisors engaged during the study had either already initiated franchising arrangements or confirmed the idea would provide immense relief to their current management, growth and expansion challenges.
6. There are several aspiring entrepreneurs in Nigeria who currently work in the public and private sectors of the Nigerian economy. Most Nigerians with potential investment capacity are out looking for an opportunity to make more money in a sustainable manner and would rather buy a franchise than take the risk of venturing into an unfamiliar business terrain. There were also indications of significant interest in proven and well established local brands rather than the foreign ones.
7. The government of the host Aba shoe cluster indicated readiness to embrace initiatives to enable the growth of the FLG sector through promotion of relevant schemes, support for off-tacking of products through contract productions, and perhaps deployment of infrastructures. In addition to the ongoing Made-In-Aba campaign, the government agreed that the efforts invested in the initiative has produced less than expected results, as the direct interference with the value chain actors has been misunderstood by the artisans. Hence this study was welcomed as an intervention that would rightly engage the stakeholders, and deliver the desired results. Franchise Opportunities are everywhere and not just in FLG sector. 

Would you like to buy a finished leather goods franchise? Or do you have a thriving business in the FLG sector that you would like to franchise? 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(Franchise opportunities). You can also visit Africa Franchise Institute   to learn more about franchise business model. 

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It is common to find most retirees thinking of starting new ways to add to their income after enjoying freedom for a while. Sometimes, people are forced to retire before the expected date.

Retirees may find that franchising provides them the opportunity to start a business they may enjoy.

Every retiree may not be an entrepreneur, but franchising offers an opening to your entrepreneurial spirit. No new jobs are available on a platter, and many retirees may have dreamt of having their own business and working on their terms which is an excellent Retirement plan. A successful business means additional income during the retirement period.

Here are 8 Things That Make Franchising an Attractive Retirement plan

• You get the guidance and some backup system to help you learn the ropes during the start-up phase and find a firm footing in the business in a short period.
• If you follow the system, you have a higher chance of success.
• Brand recognition.
• A relatively low-cost business opportunity.
• A time-tested business model.
• Well laid out procedures and operational systems.
• Strong support from the franchisor to set up the business, market the products.
• You can also look for support and advice from the franchisee fraternity.

Franchising to Support You Financially During Retirement

When you near retirement age the implications of having no monthly paycheck coming in, stare you right in the face. As you look at your savings and other retirement benefits, anxiety begins to creep in. Your reluctance “to put out to pasture” begins to increase, and your urge to start a business that offers you independence(retirement plan) starts taking root.

Full-time work after retirement is not always good for health, and franchising is a great business option that helps you meet your financial needs and more. Many retirees may not be open to the idea of starting a new business from scratch but may welcome the concept of venturing into the franchising space, where they can get some support and backing.

Time to Give Up the Thought of Retiring

The idea of retirement is changing fast, as mortality rates have increased. People want to remain physically, mentally, and financially active in their post-retirement period. For all these people, a franchise is an excellent opportunity to have a good retirement plan. They can use their experience, time, and a part of savings to start a business that has higher chances of success. It is an opportunity to be a part of a broader community of franchisees and franchisors.

Some Aspects to Keep in View

• Before you jump into franchising, carry out research to make sure that franchising is something you want to get into.
• Consult a financial advisor as a sounding board before making a decision.
• A franchisee business requires some upfront investment, but it varies with the type of business. There are low-cost franchise businesses in areas such as cleaning services, accounting, childcare, and eldercare services as well as in printing and promotional products, etc. You don’t need to invest a large chunk of your savings in these businesses. AFI and FDBS can help you with all franchising FAQs
• You can search for suitable opportunities as franchisors can help you with their relationships with banks to sort out financial difficulties.
• Look for a credible franchisor who is willing to sell a running business instead of starting on a clean slate.

You can identify franchise opportunities that are in sync with your retirement lifestyles like fixed working hours, free weekends, and no disturbance to night sleep. If you want to know more, feel free to get in touch with us at Franchise Business Development Services (FBDS). You can call us on +234 (0)908 569 4509 or fill out our Franchisee Pre-Qualification form and we will matchmake you with a suitable and available franchise business to invest in.

The post Why Buying a Franchise Could be an Excellent Retirement plan first appeared on Franchise Business Development Services Nigeria.

How does Franchising work?

The typical franchise model is based on providing certain branded goods or services. The franchisor is the owner of the original business who holds the rights to the trademark and the business system. The franchisee obtains the right to operate under the franchise’s name, typically paying an initial fee, as well as royalties, to the franchisor. When you buy a franchise, you will be presented with a franchise agreement that will detail your rights and obligations.

Expect to be required to adhere to the franchisor’s business system. Franchises do differ in the amount and details of their rules for franchisees. If your franchise is based on selling goods or food, you may have to use ingredients, parts or ready-made product provided by the franchisor. If your business is service-oriented, you will likely have to follow your franchisor’s manuals and procedures.

If you have not decided on the type of franchise the you want, you can come in and consult with us for more information about the types of franchise that will be best suited to your needs, or if you are interest in a owing a franchise business but you don’t know what to do next Click here or Here

The post How does Franchising work? 13 Frequently Asked Franchise Questions that you need to know. first appeared on Franchise Business Development Services Nigeria.

Why you require expert Business-To-Franchise consultation support prior to launching a franchise program

Franchising Opportunities has been instrumental to optimizing and replicating successful business models into new businesses and providing support systems for them to grow and thrive under large successful brands.

Franchise model eases the barriers to market entry because prospective customers extend the parent company’s brand loyalty and consumer service expectations to the franchisee company.

Particularly for micro-franchising, it is expected that the franchisor has done the work in building a successful business with a proven model, such that all that is required from the franchisees is to simply follow existing guidelines.

The franchisor who is a successful entrepreneur is paired with prospective entrepreneurs who lack the skill and in some cases, sufficient capital to develop and start their own businesses by replicating the already proven successful model, thereby also expanding the customer reach and market share of the franchisor’s business.

Now, do you consider your business successful, scalable and operating with proven systems? Do you desire to build a business model you can leverage to expand beyond the current few locations and grow rapidly, yet maintaining your business standards?

Franchising opportunities offers you the required effective route into building a global network without requiring the management infrastructure, time and capital investment of a solely owned expansion.

Inadequate planning and development of a franchise business structure before offering a franchise to prospective buyers is why business expansion through franchising fails.

Here are some of the reasons why you need Business-To-franchise consultation services prior to your launching a franchise program;

• Determining a strategic direction by defining the vision, mission, core values, value proposition, systems, a SWOT analysis etc of the business prior to franchise development.
• Identifying a suitable franchise model that works for your brand and the targeted locations.
• Developing a clear franchise offering indicating the strategy, what markets, the growth rate, development costs, etc.
  
  Culled from the FBDS Nigerian Franchise Report. Contact us or AFI to get started with your franchising opportunities.

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