What are the steps to becoming a franchise

Franchise system: the 10 most important steps to your own company

The dream of your own franchise system: With a multipliable and innovative business idea, you as an entrepreneur can become a franchisor yourself. The German Franchise Association outlines the ten most important steps to your own franchise company:

Step 1: develop a business idea

Check whether your business idea can survive in the market. Define your unique selling points and create one detailed concept with system services, structures and work processes. Also formulate your company philosophy.

Step 2: Analyze franchise suitability

Your concept is franchiseable if it includes these conditions Fulfills:

  • It can be put into practice without any problems.
  • The costs pay off for you and the franchisee.
  • You are offering a really attractive existence.

Step 3: Create a franchisee profile

Get a clear picture of your ideal franchisee in advance. Then you have later when choosing your partner more security and less costs.

Step 4: Analyze the market and prospects for success

Before starting, analyze the market and your target group. This includes intensive market research, the observation of price developments and information about target groups and competitors.

From this, derive concrete measures for the distribution of tasks, organization, communication and scheduling.

The market should at least 50 to 120 franchisees in order to exploit synergy potential.

Step 5: Define the marketing concept

The marketing concept is the core of your franchise package. In it you create the system as defining brandby describing in detail your procurement, range, marketing and location policy. This includes all the details such as rental agreements, advertising, distribution and so on.

Step 6: determine the type of business

Determine the individual elements of your business concept, for example operational management, criteria for franchisees, advertising and sales measures.

Step 7: Draw up a system plan

Draw up the budget for your system and develop a liquidity and investment plan. Define the elements of system organization and system security.

EXTRA: 10 success tips for starting your franchise

Step 8: test the system

Try out in a pilot operation whether your business concept implement in the market leaves. Then the future franchisee will know whether the system is working.

Step 9: Formulate the franchise agreement

With the franchise agreement, you create the legal basis for your future contractual business relationships. Develop the document together with a a specialized lawyer.

Step 10: carry out cooperation tests

In the final phase, test your system with four to five franchisees.

This shows, for example, whether the support from the system headquarters works optimally, whether you have selected the right franchisees and whether the franchise contract covers all important points.

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