Mention the word franchising and most enterprise owners looking to grow their business would probably tell you they have, or still are, thinking of it as an expansion tactic. And why would they not, as franchising seems to guarantee a steady and proven way of making money. Last year, franchising expert Armando Bartolome of GMB Franchise Developers expected the industry would grow by as much as 45 percent, as more companies turn to franchising to grow their business.
The fact that it's a buzzword among entrepreneurs doesn't make the franchising route easy. For one, not all kinds of businesses are franchisable. Aside from that, franchising requires a special kind of partnership between the franchiser and his franchisees, therefore, those who shun the idea of sharing their trade secrets are better off thinking of a different way to grow their business. As Bartolome says, "The success of any franchise business lies in creating a harmonious relationship between the two parties involved."
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How do you know you're ready? In an article published in Entrepreneur magazine (July 2009, by Marie Anne Fajardo), Samie Lim, chairman of Francorp Philippines, says, "If the economy is good, all franchised stores do well, and when the economy is bad, franchisers do better." Lim clarified that franchising essentially involves transferring a successful business formula to another person or company. 'Successful,' then, is the operative word in franchising. "In contrast, a 'fake' franchiser doesn't know how to be successful; he or she just thinks of how to make money," Lim said.