The Business Concept and its Marketability
When you are considering using franchising as your means of growth, it critical to know what qualities are necessary in proceeding.
We looked at the importance of structure recently in the potential to franchise, now we are going to investigate the marketability of a business and if it is franchiseable: Business Concept and Marketability.
Business Concept and Marketability is part two of a three-part series on franchising business concept. Did you miss part one? Read through Business Concept and Structure in Franchising here.
The Business Concept and Marketability
It is not vital to be in business for a long time nor is it needed to be big. Of course it would be nice to be operating for a number of years and have a large stable of units humming along, but most companies that start to sell franchises have only one working unit.
Often this is actually a selling point to potential franchisees because it suggests that the business is in an emerging new industry or that it is catering to an unserved or underserved sector in the market.
If the business is a one-unit operation, you will want to stress the hands-on assistance available and the personal accessibility.
When a business is just at the concept stage, ensure that there is a market for the exciting, new, or unique product or service. This is even more the case if you need to educate the consumer on what you are offering.
When a concept or product is not critical with an existing business it is helpful to be able to show a difference between you and your competition through your distinctive store design, special marketing program, or the effective way of delivering your product or service. Sometimes only one aspect is needed to be different to gain success.
Other vital aspects of business marketability include:
- Facilities and Personnel: Keys to solid franchising is the ability to assist franchisees in finding locations for their franchises. The right location can mean the difference in making it or not. It is also important that franchisees know how to find the right personnel to operate within the business.
- Teachability: In order to be franchiseable the business must be marketable not only to customers but also to franchisees. One of the most important factors in the readiness to franchise is teachability. You should be able to train a new franchise owner how to run the business in about four to eight weeks.
- Credibility: Something invaluable to marketability is reputation. Prospects are human, they respond to success stories. All good publicity be it news stories, letters, and customer comments will enhance the process.
- Cost: More important than the overall cost of a franchise business is the amount of up-front cash necessary as is the ratio of investment to total expenditure. A valuable point in the marketability of a business is leverage. The higher the percentage that can be financed the easier it may be to sell the franchise.
Is your business or concept marketable to franchising? If you would like to find out contact a Senior Consultant at 1-800-FRANCHISE (1-800-372-6244) or fill out this form.