How to... set up your franchise

Looking at owning your own business? But scared that it may not take off? Not sure how to set up your franchise? Fortunately, the franchising route offers you the opportunity to receive backing from a successful and reputable franchise brand, offering a great platform to becoming your own boss! 

There are however stepping stones that need to be hopped onto before you can eventually gain the keys to your new shiny franchise business….

Franchise Supermarket on how to set up your own franchise

Franchise research

We would strongly advise that you communicate with as many different franchisees from within the franchise network that interests you. This will help you better understand whether this is the right move for you. A great way to both communicate with existing franchisees, franchisors, franchise consultants and franchise lawyers is by attending an organised franchise event. The franchise experience you can gain from exhibitors can be vital in helping you decide whether this is a route you wish to proceed with. Franchising is on the up and the UK hosts many Franchise Seminars and Exhibitions. Natwest help organise regular seminar slots in London and we also have The International Franchise Show at ExCel in February and The National Franchise Exhibition at the NEC in Birmingham during October. These are two large franchise events that you will benefit from. Franchise finance advisors and large banks such as Lloyds and Natwest are usually in attendance and can help assess how much capital can be borrowed if this is a route you need to visit.

Franchise discovery days

These are usually half day events that take place at either the franchisors head office (franchise training centre) or a nominated location. Some brands like to make it as easy as possible for you to attend, so will hire locations around the UK to ensure you don’t have to travel as far! These events give you as the prospective franchisee the opportunity to see how the franchise really functions, to quiz the franchisor and witness first hand demonstrations of how the franchise service operates. Never sign an intent to proceed after just one visit! We know some of you are rather impulsive… but it’s vital you digest all of the information you’ve obtained and go away and discuss with your loved ones and friends, they may have spotted something that you haven’t seen. When attending franchise discovery days, it’s crucial that you prepare in advance, have questions ready to ask both the franchisor and franchisee, and discover how much support really is on offer from the franchisor and how long the franchise training will take.

Obtaining your Franchise Territory

If you like what you see and it’s ticking all the right boxes, then it’s time to look at your very own franchise territory. If it’s a sales business that focuses on chimney pots and/or commercial buildings, then territory is crucial and will have an impact on performance. Most franchises would’ve invested in franchise territorial mapping prior to choosing a location, to ensure you have an area that includes the sufficient selling potential. It’s important to note that some franchisors are flexible and may allow you to alter the boundaries within reason. If you don’t ask you don’t get!

Obtaining franchise funding

You’ve chosen your dream franchise and you’re ready to go, that’s great news! But there’s just one little problem…. You’re lacking the full required franchise investment and franchise working capital. This shouldn’t be an issue, if your credit history is of good standing and the franchise brand is credible then they should be able to provide you with a franchise business plan. This is what the big high street banks will request when seeking funding to purchase your franchise. Most high street banks will have specialised franchise sections. There are other franchise lending streams such as Franchise Finance and Transmit who also assist with franchise funding, the latter offer up to £25,000 unsecured at just 6% to secure your dream franchise. 

Speak to franchise professionals

It’s vitally important that you get the advice of either a credible franchise lawyer or franchise consultant to look over the franchise agreement prior to you signing. They may be able to spot something that you’ve missed. A Franchise Agreement can be quite lengthy, and you may be inclined to hastily go through content so that you can set up your franchise as quickly as possible.
As with any consultation, fees will be applicable when seeking the advice of franchise professionals.