Franchisor Advisory Services
Franchisor Advisory Services
- Strategic planning for franchising
- Franchise development (sales) and ongoing support
- Identification of strategic partners
Franchisor Advisory Services: Franchising your business is a great way to rapidly expand your company’s footprint with minimal investment. Rockford Advisors works with clients who are or want to become a franchisor. We can assist with all aspects of franchising from exploring various growth options to conducting initial research and strategic planning to franchise development (sales) and ongoing support. We can make recommendations on strategic partners to engage in the process and benchmark ways to enhance franchise offerings. We provide advice and ongoing resources to meet your business needs.
Our Approach
It is important to understand that getting your franchise system in place takes some time, effort and requires a certain expertise. Franchising is a type of contract law governed by the Federal Trade Commission and some state laws. Franchising is not the best approach for every business, so it is important to gain a true understanding of your business goals, your expectations, your appetite for initial investment, your culture, and discuss different types of possible models to ensure your success.
The following is a high-level synopsis of a typical franchise program.
Initial meeting with key stakeholders to brainstorm your organization’s challenges and obstacles as well as discuss ways that franchising might provide you an opportunity for rapid expansion. This includes companies who have never franchised operations as well as current franchisors whose franchise development system has stalled.
Based on the initial brainstorming meeting outcomes, begin to map out a “strawman” plan to move forward. This might include building a financial model with key assumptions to understand investment and potential rewards. A formal Strategic Planning session might be a helpful part of this process.
A follow-up discussion to ensure all relevant parties in this initial phase agree and on an approach, then begin to conduct initial research into what competitors might offer, for benchmark purposes, and take inventory of items you may already have or what needs to be built for the Franchise Development Document (“FDD”). You will be providing your franchisee a “Business in a Box” so that they can be extremely successful.
Now that you have conducted your initial research and decided on a plan it is time to finalize the franchise strategy and begin to assemble your franchise development (sales) team. Part of this process includes aligning your organizational policies and procedures to the franchise offering. You will need to begin mapping your Designated Market Areas (“DMAs”), or geographies, that you wish to franchise, and determine the related fees a franchisee will pay to the franchisor. You will need to engage a franchise attorney (as with everything, we can make recommendations) to draft your FDD.
The FDD is a legally required document that is provided to the franchisee candidate. Among other things, the FDD discloses pre-sale information about the franchisor, its officers, the franchise offering, financial performance statements, training and support offered, copies of any required forms that the franchisee will need to sign, and a generic version of the Franchise Agreement itself. The Franchise Agreement is the actual contract that the franchisee and the franchisor sign. There are rules surrounding the timelines of certain events and several U.S. states require that the FDD be registered prior to any sale of a franchise in their state.
With your program ready to go and your FDD completed (and registered where needed), you can begin to sell franchises to prospective candidates a franchise following the Franchise Development process we help you define. This includes working with our network of experts to build a suitable website, develop a marketing and advertising plan by targeted DMA, and planning regarding “road shows”, etc. All of these activities lead to Discovery Day, where the prospective franchisee meets key executives in the company in order for both parties to make a decision about moving forward.
