image2-2
  • Sep 11, 2015
  • nick.strong
  • No Comments
  • 1+ Likes

Business Today NTV – Nick Strong on Franchising

Nick Strong, MD of Franchise Intelligence recently appeared on NTV's Business Today programme. Nick was joined by other experts of their respective fields to help unriddle some of the questions that frequently come up around franchising. How did you get into the business of franchising? What is your background? I started off as a foreign language teacher and from there built a business teaching languages, mainly French, to primary school children. In the UK children generally begin learning a different language at age 11 even though many parents will aspire for their children to learn before that. The language company was taken over by a franchising company which is how I got into franchising. I joined the team and worked both domestically and internationally to help people go into business for themselves, but not by themselves. Essentially, franchising is all about working for yourself but not by yourself. What is franchising and how does it work in practise? Franchising is a way of growing and scaling a business. A business owner may have found they have reached the potential of growth for their business geographically which in turn will stop them from being able to expand further. An option for legitimately expanding is taking on franchisees that will take on the brand as a franchise, will follow the system built by the business owner and will replicate what is proven. This will help to build their own success and the success of the business. How can business owners grow through franchising? There are fundamentals to franchising. Firstly, the business must be proven, profitable and replicable. The brand must also be protected through trademark. No not think that franchising is a way of getting out of a problem the business may have such as if the business is struggling. When you are taking someone’s investment in franchising, you are taking on a big responsibility to help train them to replicate the business you have built. They will be taking on the trademark and the business system you have developed to become successful in business themselves. This responsibility does not end at the branding as the way they handle customers and business affairs all comes back to the way they have been trained and supported. money-767778_640What are the requirements of franchising a business? In the UK there is no legislation so potentially anyone could say they are a franchise business. For that reason, the British Franchise Association (BFA) exists. The BFA is a standards based organisation in which franchisors must meet certain standards before becoming a full member. If you are thinking about franchising, as a franchisor you want to meet those standards the BFA outline. Potential franchisees will want to see that the business owners have gone through those systems to proven the business is proven, profitable, replicable and ethical. What are the costs involved with franchising a business? If you are a business owner, franchising is not a cheap thing to do. The BFA Natwest Survey on the franchise industry suggests anything between £75,000 - £150,000 to franchise a business. This is because there is a lot of advice required and a lot of time. Before franchising you must set up a pilot and ensure that everything is proven, profitable and replicable. This will take time, consultative advice and legal advice. Most franchise businesses will only break even after around 3 years of trading so it is a long journey to build the business through franchising. However, once you get to that point you move into bottom-line profit and the business becomes profitable very quickly. How does someone thinking of investing in a franchise benefit? If you are thinking of investing in a franchise, particularly if you’re going into business for the first time, franchising can be beneficial to you in a number of ways. It is a way of following what is already proven, a way of getting training, a way of not being isolated because there is someone you can speak to on hand all the time. It is a way of running the business for yourself but having that proven model, the training and support from the franchisor to help you on your way to success. When considering the cost investing, there are various types of franchises and each one will have its own individual costs. Depending on the franchise, you could be investing anything from £10,000 - £1,000,000. If you have any questions about franchising contact Nick Strong through the links below.

Connect with Nick Strong

Franchise Intelligence Managing Director

linkedin sociocons-1024x748 twitter email

Most Popular