I'm thinking of franchising my business and I'd like to know more..


Are there any long term costs associated with running a franchise operation?

  • Essentially no.
  • You may choose to join the Franchising Council of Australia, for which there is an initial joining fee and annual membership.
  • Incoming franchisees pay their legal costs to you. This covers the prospect's lawyer speaking to your lawyer on legal points, and the preparation of the specific documentation.
  • Typical ongoing expenses are documented in the expenses spreadsheet. We recommend that annual conferences are at the franchisees' expense. (At least part of).
  • You may choose to provide training days or sessions at a cost to the franchisee or at no cost. This does not need to be pre determined at this point. It is advisable that general support and personal visits to franchisees are at no cost.


How will I recoup my initial investment in the franchise process?

  • The franchise process presents an ideal opportunity to analyse all aspects of the business to be franchised. The franchising process examines the business systems and strategies are developed. This is worthwhile in itself.
  • In many regards undertaking the franchising process is similar to having business coaching and it is certainly similar from a costing perspective.
  • The main difference is that there is a tangible outcome at the end of the franchising process which is a documented franchise system.
  • It is quite usual for the first one or two franchise sales to cover the costs of the initial franchise process.


I am frightened of losing control over the business system if I franchise.

  • Franchising offers the ultimate in control over the system and can and should incorporate extensive reporting measures.
  • A franchise agreement clearly states the franchisee's obligations and if the obligations are not met the franchisee is in breach of the agreement.
  • Expansive reporting structures and software applications can assist the franchisee and the Franchisor with achieving compliance to the system.
  • Best franchising practice ensures that franchisees understand the benefits of compliance and are encouraged to comply with the system.


What are the main benefits of franchising my business? Is it worth the cost and effort?

  • Franchising provides a growing business with a low cost expansion method.
  • Franchising contractual obligations provide an enforceable method of quality control.
  • Franchising provides ongoing income.
  • Franchising accelerates market dominance and brand recognition.
  • Franchising provides bulk buying opportunities.
  • Franchisees are self motivated independent business owners with a desire to succeed.

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