When Is The Right Time To Franchise Your Business?

Sneha Santra
Sneha Santra Apr 04 2019 - 3 min read
When Is The Right Time To Franchise Your Business?
There are a few essential conditions that any business hoping to jump into franchising needs to have covered.

Franchising a business has a whole host of benefits. Though franchising is the best option for expanding a business, not all businesses make good franchises. There are a few essential conditions that any business hoping to jump into franchising needs to have covered.

If you have customers lining up at your store clamouring to avail your products/services and you are making huge profits, it is natural to think that your business is successful. However, the business which is successful in one location may fail to prove it in another or nationwide. Thus, there are few things you need to contemplate about, before franchising your business. Patience is the key here; wait for the perfect time to replicate your business model. How to know if it’s the right time? Here are some points to consider.

Demand for Your Business

One of the good signs which will indicate the right time for franchising your business is when potential franchisees start reaching out to you. People will start asking if you are accepting franchise applications, whether you could offer them a franchise, or if you’ll be franchising in the future. When there will be interest from third parties to invest in your business, is one of the green flags to consider replicating your business model. Having potential franchisees already in the pipeline can help justify the outlay of cash required to set up a franchise operation.

Sales Are Steady

If you thinking of dipping your feet into franchising waters make sure your sales are steady. Introspect into your business growth; how the sales have been for the past few years. If there’s any dip in the profit share, your business model is not ready for franchising.

A franchise isn’t a means to turn your business around. If you are still struggling with keeping your profits steady, franchising it will not head towards a positive direction.

Can you Clone it

Franchising is all about replicating a successful business model. Make sure your business structure has a strong system and processes, which can be replicated easily.  

For instance, if you own a fast food business, once you decide to start franchising, you’re no longer preparing then yourself. Instead, you are now running a joint which will serve fast-food. You will be required to teach your prospective franchise on how to prepare the food, which locations are preferable. So make sure that your business model is easily understandable and can be cloned.


If you are thinking that franchising is a “no-cost” expansion strategy, then it’s time to burst that bubble. Franchising is definitely a low-cost means of expansion; it is not a “no cost” strategy. This is because you will need capital to develop legal documents, manuals, training programs and marketing materials, not to mention a marketing budget for franchise lead generation. If you do not have the budget for executing all these tasks, then it’s definitely not the right time for you to franchise your business.

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