Would franchising be a good option to increase profits for a three-year-old privately owned restaurant with slow, but steady growth? Or would the initial costs of franchising outweigh current gains in profit since the business is already established?
Franchising your business & knowing when to take the step
We may not be crystal clear on the meaning of your second question, but here’s our take. The length of time that a business has been in operation is not as important as the proof available that the business is being run by well-defined systems. A sound and proven system that can be taught to others is a critical element of franchising your business. Obviously, the business upon which the operating system is based must also be profitable to the extent that the owners can make a living and pay off any debt at the same time.
If you are profitable and have systems, you might be a franchise candidate, but there are numerous other factors to consider when franchising your business. A quality feasibility study, sound strategic planning, and the establishment of sound franchise relationships at the outset are all key components to getting your franchise concept off on a good footing — should you decide to go that route.
We invite you to read over the materials for franchisors at this site for deeper information and insight about franchising your business, that may be of help in your particular situation.