Growth & Strategy Conversations
Franchising copies a business that works. It cannot rescue one that does not.
Many owners are asked, “Why don’t you franchise?” Others are approached by franchisors with confident promises. Both deserve a careful look. This session sets out what a business needs before it can be franchised, how the money works for each side, what to ask before buying into one, and the alternatives that may suit better.
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A franchise sells a system. If the system is you, there is nothing to sell.
In franchising, one business lets others use its name and way of working in return for fees. It can let a good business reach many towns without the owner raising the money for every outlet. For the person who buys in, it can offer a tested method and a recognised name.
It also asks a lot. The method must work without the founder standing beside it. The brand must mean something to customers. The franchisee must be able to earn a living after fees. Many owners find that one or more of these is not yet true. This session helps you find out before you spend money, and helps you ask the right questions if you are on the buying side.
What the session covers
33 topics across 7 areas. Seven parts, for owners who might franchise and for those who might buy.
What Franchising Is, and What It Is NotGetting the terms straight.4
- Franchisor and franchisee: who does and owns what
- How it differs from a dealership, a distributor or a licence
- How it differs from opening your own branches
- Why the name and the method are what is being licensed
Is Your Business Ready?A frank checklist.5
- Does it make a healthy profit in more than one location, run by someone other than you?
- Can the way of working be written down and taught?
- Is the name registered, and do customers recognise it?
- Is the quality of what is delivered consistent?
- Do you have people who could train and support franchisees?
If the honest answer to most of these is no, running two or three of your own outlets first is usually the better step.
The Money, Both SidesFranchisor and franchisee each need to earn.5
Participants work through a hypothetical example with round, made-up numbers, then repeat it with their own figures.
- The usual kinds of fee: upfront, ongoing, and for marketing
- What a franchisee must invest before earning anything
- How long it takes a franchisee to recover that investment
- What you, as franchisor, must spend on support
- Why a fee model that leaves the franchisee struggling will damage the brand
Building the SystemWhat a franchisee needs from you.5
- An operating manual in plain language
- Training before opening, and help after it
- Standards for supplies, quality and customer handling
- How you will check standards without being heavy-handed
- What happens when a franchisee underperforms
Choosing FranchiseesYour reputation is in their hands.4
- What kind of person succeeds in this business
- Finance, time and commitment they need
- Meeting them in person, and in the operation
- Saying no to a person who can pay but will not follow the method
The Legal Position in India, in OutlineNo single franchise law. Several laws apply.5
- India does not have one dedicated franchise statute; the agreement and general laws do most of the work
- Contract law, trade mark law, competition law, tax and, for foreign parties, foreign exchange rules can all be relevant
- Why the written agreement matters so much
- Why the trade mark should be registered and the licence in writing
- Points to check: territory, exclusivity, pricing, renewal, termination and what happens to the premises and stock afterwards
This is orientation, not legal advice. Rules change, so take advice from a qualified lawyer before signing or offering any franchise.
If You Are Thinking of Buying a FranchiseQuestions for the seller.5
- How many outlets are operating, and how many have closed?
- Can you speak to existing franchisees without the franchisor present?
- What exactly do you get for the fees, in writing?
- Any income figure quoted: on what basis, and for which outlets?
- What can you do if it does not work out, and what does leaving cost?
Treat any promise of assured returns with great caution, and ask for it in writing.
Exercises owners do in the session
- Score their business against the readiness checklist
- Build a one-outlet model: sales, costs, fees, profit and payback
- Write the first page of an operating manual for one task
- Prepare the ten questions they would ask any franchisor
What participants leave with
- The readiness score and the model they built
- A checklist of what to prove before franchising
- A buyer’s question list
- A list of points to raise with a lawyer
What this session is not
- Legal, tax or financial advice
- A franchise sales event or a list of franchises to buy
- A promise that any business can be franchised successfully
How the session runs
A facilitated conversation of two to three hours, in a small group. A practitioner who has built or worked with multi-outlet businesses explains each stage and the common mistakes. Owners then work through the readiness checklist and the one-outlet model with their own numbers, and discuss what they found. Participants who are considering buying rather than selling work on the buyer’s questions instead.
What your students leave with
- An honest self-assessment of whether their business is ready to be copied
- A simple model of the money for the owner and for one franchisee, with their own numbers
- A list of what a franchisee would need to be given in the way of training and support
- A set of questions to ask before buying into any franchise
- Awareness of the legal position in India and when to take advice
- Alternatives to franchising, and when each fits better
Scheduled sessions
Nothing scheduled yet
Sessions are arranged with a college once a date is agreed. Ask us and we will find the right person for it.
A student rather than a college? See what is coming up, or ask your placement team to host this.
Prove it works without you, make the numbers work for both sides, and take legal advice before you sign.
Tell us who your students are and what stage they are at. Sessions are free for participants.