Franchise Asia APRIL 2015

International Focus
The Fifteen Steps to Franchising:
1Undertake a feasibility study (or just your own due diligence
to prove the concept you have can work). I become very
concerned when I hear from potential Franchisors that they
have not opened or company run the business they are planning
to Franchise – and I even have said to major international
companies intending to open in Australia, why not open a couple
of stores yourselves to prove that it works. Unfortunately many
American Franchisors say that is up to the Master Franchisor –
and do I know anyone with $5M to invest? Most of those are still
kicking tyres looking for their dream investor.
5Site selection policy – decide what type of stores you are
seeking in terms of size, where they sit in terms of Impulse
or Destination, and how you can instruct other people in
what you are looking for. Issues need to be considered include
size, traffic (vehicle or pedestrian), visibility, parking, access,
local generators (or neighbours) and many other issues.
6If you are a service franchise, you probably need to
grant territories especially if you have a central ordering
concept where leads come in by phone or computer.
What is the policy for Territories in terms of what makes up a
sufficient size territory and how many should we be looking for in
each main market? You may start with a “beer and pizza map”,
however this develops an inconsistent Franchise System.
2Understand that the costs to develop a workable
franchise system is probably $50K - $100K, and
thinking you will do it cheaper is a false economy. I am
often asked to postpone payment for my companies’ service,
and I remind the client that we are Consultants and that Banks
are Banks – and go and speak to them if you plan to make an
investment into Franchising.
7Sort out your marketing and make the necessary
decisions on who is your potential customer and how
are we going to find them? If it is a walk up customer,
then image and signs. If it is a phone in customer or web based
customer, how do we attract them, inform them and entice
them to make the call to purchase form us? Do we advertise
in magazines, websites, bus shelters or many many other
opportunities that will be thrown at you?
3Arrange the writing
of your Operations
Manuals. Your choice if
you do it yourself or work with
a Professional company who
will have templates and ways
to construct these manuals.
Ideally they may start as paper
manual, however the modern
companies are setting this up
in a digital environment – thru
the web.
4Strategic Network Planning is thinking in terms of what
the network may look like in 5 or 10 years. It is about what
type of areas you should be physically looking for sites
in. This investment may save you huge amounts in mistakes, as
there is no cheap reversal in leaving or closing a store – and less
if you lose a legal case if the store you approved turns out to be a
disaster – and you have no process you can demonstrate in how
you made the decision.
8Find your first few stores. This can be undertaken
internally, or you may want to appoint a professional
site finding company who are expert in negotiating with
Leasing agents and Real Estate agents.
Franchise Asia • 2015 Vol 27
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