• Aug 31, 2017
  • Marketing
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How to Use Franchising: 5 Steps to Grow and Scale Your Business


 It is the dream of many thousands of people to turn their idea into a business. However, the biggest challenge is of course turning the start up into a success. So, what does success look like and what are the phases to manage a successful franchising? 

 Phase 1: Start up 

For obvious reasons, the start-up phase is the one many enter into and it is where most fall. This is because the new business owner has to prove the idea, but in most cases, prove themselves A sceptical brand dependent world, awaits the start-up champion!

Phase 2: Proven concept 

For the small percentage that manages to cover the costs, repay their start up investment and move into profit, it may be said that the business and its operations move into the phase of being proven. This is not easy to achieve and takes a great deal of hard work, sacrifice and support from family and friends for our intrepid start-ups. The business owner that makes it to the proven stage is therefore to be congratulated! 

Phase 3: Growth to potential 

Once the business is proven, then it's time to invest again and grow. Growth that is organic, takes time and effort. Investing into staffing, training, telecoms, HR, marketing and sales, as well as hardware, software, offices, vehicles etc, takes time and is not without risk! The growth to potential phase is therefore a learning one at each stage.  

Phase 4: Scale the business 

Most businesses reach a point of diminished returns in their growth. This is because the cost of gaining and supporting new clients can increase, as the business has to travel further to reach new clients. To scale and keep the business growing, the owners must either invest again to set up operations in new locations or develop its operations through business format franchising. 

Phase 5: Exit 

There are a number of positive small business exit options: 

  1. Sell the business while it is still growing in the local area. 
  2. Invest in building out the business in new territories and create a management structure that the owner can chair. 
  3. The owner will keep his business and hand over operations to a management team. 
  4. The owner will invest into turning his business into a business format franchise and grow via the investment of third parties, known as franchisees.


Finally, as a first step, the new start-up may be best advised to invest in a business format franchise, as they will build a proven system with proven operations and ongoing support. Therefore, success is statistically much higher for franchisee start-ups.


For strategic advice and support on growing your business contact us on 023 8027 5710, email info@franchiseintelligence.co.uk or connect with the author of this blog Nick Strong via LinkedIn - https://www.linkedin.com/in/nickstrong/

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