To help you determine whether you can franchise your business, Einbinder & Dunn suggests that you think about the following:
Question #1: Do you have a proven business concept?
Potential franchisees want to know that your franchise business concept has proven to be successful. Success can be measured in many different ways, including the profitability of your business, the number of years you have operated your business, the number of units you have operated, the size of your operation, and the strength and awareness of your brand.
Question #2: Do you have a strong brand?
Franchising is a method of expanding your business by granting a franchisee the license to operate a franchise using your trade name, trademark and trade dress. Other than the value of the knowledge of how to operate your business, much of the value associated with purchasing a franchise is attributed to the strength of the brand. Einbinder & Dunn can register your trademark and help develop the legal framework to protect and strengthen your brand.
Question #3: Is your business concept different from current businesses in the marketplace?
You can differentiate your business in many ways, including offering unique products and/or services, offering products and services at reduced prices, offering higher quality products or services, targeting different markets, or implementing a distinctive marketing strategy.
Question #4: Can you teach others how to operate your business?
One of the keys to franchising is teaching franchisees how to duplicate the way you operate your business. The easier it is to teach your proven business methods to a franchisee, the quicker it is for that franchisee to be up and running, and the likelier that franchisee will be able to duplicate the success of your business.
Question #5: Does your business have regional, national and/or international appeal?
The more marketable your franchise system is across various geographic areas, the greater the chance of success for your franchise system. Some franchise concepts do not work in certain geographic areas as well as in others. It is important to understand how marketable your franchise concept is and what geographic areas your franchise concept would appeal to. This market analysis would help you maximize the potential of your franchise system in those geographic areas that your franchise would operate in.
Question #6: Do you have a strong management team in place?
Running a franchise system involves a different skill set than operating your current business. To develop a successful franchise system, you will need, for example, personnel who can conduct the training program, employees who are knowledgeable in marketing and building brand awareness, and a sales staff to generate leads for potential franchisees as well as potential customers for the franchise system.
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For questions or additional information about Einbinder & Dunn's franchise law services, please contact Einbinder & Dunn by clicking here to fill out a contact form or by calling 866-490-4909 or 212-391-9500 to speak with one of the firm's partners.