Today we hone in on the franchise business model. To help us do that, we brought back Martin Lo Surdo of Amplify Business to walk us through the sorts of questions that both potential franchisors and franchisees might be thinking about.
- Getting into Franchising
- The Franchise Business Model
- 3 Reasons for becoming a franchisor
- To be a franchisor, your business must be
- 3 Tips for potential franchisors
- 4 Reasons for becoming a franchisee
- Limitations of franchising
- 2 Tips for potential franchisees
- Franchising in media
- How to contact Martin
Getting into Franchising
This friend of mine said, “I think I might have something for you.” He was working for a prominent franchisor at the time and a national marketing manager. He thought I was really well positioned to interview new franchisee applicants coming through, wanting to take on a franchise.
So my initial foray was interviewing people as a selection manager for people wanting to join into a franchise business.
– Martin Lo Surdo
The Franchise Business Model
There are many franchise businesses that sell franchises and the better businesses grant franchises. That is a real distinct difference.
Business buyers want to know what they’re getting themselves into so what’s really important is actually presenting the facts of the business, presenting the systems.
If I look back at my career, one common thread is small business and my enjoyment in being involved in small business and the role that small business plays in the local community. I really enjoy what small businesses can do it really. They obviously start small but they don’t envision to always be small.
The franchise business is a good way of getting people into business and fulfilling their career goals by business ownership.
– Martin Lo Surdo
Reasons for becoming a franchisor:
- Reach a wider audience – using franchising as a distribution model
- Have access to funding – where the franchisee acts like a commercial partner
- Change in interest – for the business owner who wants a change in his role in the business
To be a franchisor, your business must be:
- Able to be replicated
- Have well-established systems
Tips for potential franchisors:
- Get a good lawyer because there’s a whole lot of legal compliance around franchising.
- Talk to an experienced franchise consultant to get some guidance and advice.
- Have your brand protection in place because failing to do so can have all sorts of connected potential issues.
Talking Law – A sister podcast!
If you’re interested in hearing smart legal tips for business, The Deal Room sister podcast – Talking Law is perfect for you! These two podcasts are now among the top legal podcasts in Australia.
In our Talking Law podcast, I dissect a different topic each week that I have seen impact businesses and then provide actionable tips for you to avoid that risk or to use that legal area to your advantage. We release new episodes every 10 days and you can listen to our episodes through www.talkinglaw.com.au or subscribe to our Talking Law podcast on iTunes to be the first to know when a new episode is out.
Now back to the show!
Reasons for becoming a franchisee:
- It’s a proven business model.
- Training comes with the package.
- You get ongoing support.
- It’s a business that continues to exist.
Limitations of franchising
If you want be a bit more independent as an entrepreneur, franchising is not for you. You’ll feel like you’ve been handcuffed. – Martin Lo Surdo
Tips for potential franchisees:
- Conduct your own due diligence
- Get educated about the industry
Franchising in media
I do believe that there are certain practices in different business or franchisors that aren’t up to scratch and I think that needs to be addressed. But it shouldn’t taint all of franchising because I know first-hand franchise owners and franchisees operating really well and really successfully. It’s a shame for them that franchising is getting dragged through the media in a negative way at this moment, because there’s a lot of successful stories as well.
Ultimately, when any negativity is brought to the surface, it’s a real opportunity for the industry to improve itself.
– Martin Lo Surdo
If you have more questions about franchising, contact Martin through:
- Website www.amplifybusiness.com.au
- Direct Number 1300 267 287
- Facebook https://www.facebook.com/amplifybusinesssales
- Twitter https://twitter.com/amplifybusiness
- Linkedin https://www.linkedin.com/company/amplify-business-strategy
Disclaimer: The material contained on this website is provided for general information purposes only and does not constitute legal advice. You should not depend upon any information appearing on this website without seeking legal advice. We do not guarantee that the contents of this website will be accurate, complete or up-to-date. Liability limited by a scheme approved under Professional Standards Legislation