10 Steps to Opening a Franchise

[Music] hey guys this is Tiffany with franchise frankness calm and in this video we're going to go over the 10 steps to opening your own franchise now these steps are important to say that you know what to expect as you start your journey into opening your own unit I've personally walked many franchisees through this process and it's helped them understand the entire roadmap so what's coming up next what can I be working on etc so it's very beneficial to understand the whole process so that you don't get overwhelmed and so that you can also see what's coming up next so with that let's get started step 1 find a franchise now that sounds easy enough but it entails more than you think so task number 1 self-evaluation now you want to think about your personal financial statement your experience your current lifestyle and your why you know why do you want to get into a franchise that leads right into our next task which is choose your franchise type a lot of different franchise types out there there's restaurant franchises there are entertainment franchises there are franchises in healthcare franchises in retail you know choosing that franchise type based on that self-evaluation is really going to set you up for success and that leads us into task 3 concept search now we have a whole video on how to search for a concept so I'm gonna link that below and I'm gonna go to the next task which is to call around call the different franchises whose franchises you're interested in do a little mini interview get a feel for the culture and while you're on the phone with them find out if they have any requirements such as financial requirements all franchises all health franchises are going to have financial requirements so go ahead and find those out why are on the phone with them that leads me to the next task which is review the FTD now while you were on the phone with the franchisor their main goal with that conversation if they vetted you to a point is to send you their FDD their franchise disclosure document so I'm going to cover the details of franchise disclosure document in another video and I'm going to go ahead to task number six which is call the franchisees the franchisor is probably going to give you a list and that may be within FDD franchisees that they think are similar to your situation okay step number two is financing analysis now this involves things like your profit and loss statement so when you're on the phone with the franchisor ask him if he can send you a copy of a P&L now usually they will give you that and expressed in terms of percentage so you may not have exact numbers but using the FTD and a P&L template that's provided by the franchisor will get you far enough to understand big picture now another task within financing analysis that I would recommend would be going sit down with the bank understand your financing options before you get too far invested in the thought of this franchise alright step 3 buying a franchise so what does that entail right at this point you've done yourself evaluation you found a franchise that you liked you've reviewed their documents their FTD you've talked to them etc they're likely going to invite you to attend a discovery day so discovery days are usually day-long events where the franchisor will invite you to their home office and they will explain the concept and detail to you so you'll hear from all the major departments you'll hear from real estate marketing development construction operations you'll hear from all of those folks and they'll tell you what owning and operating this franchise looks like now after Discovery Day and the franchisor is evaluation of you and your evaluation of them the next logical step is the franchise agreement and the franchise agreement is a contract between you and the franchisor that details out all the requirements all the obligations all the monetary implications of you owning and operating that franchise okay step number four site selection so I've done a whole video on site selection now I'm going to link that below it talks about the four buckets of real estate and it kind of hones in on the basic principles of site selection so I'll link that down below and we'll go on to step number five which is real estate transactions so there's a lot to take in in terms of real estate transactions the first thing is are you going to lease or are you going to buy or acquire the property now in most cases people lease and with leasing goes along letters of intent intense project scheduling because you want to make sure that you hit those deadlines and the lease agreement itself so we're going to go into more depth on the lease agreement in another video and I'm going to go on to step number six which is plans generation so you've signed your lease and now you're ready to hire an architect and get going on the plans so at this stage of the game you want to be in heavy contact with the franchisor because they're going to give you design requirements and your architect is going to be responsible for implementing those design requirements into your plans now generally speaking plans generation takes anywhere from 30 to 45 days depending on the complexity of the concept now understand that within the plans generation phase you may also be working with a civil engineer you may also be working with an attorney you may also be working with community boards such as Planning and Zoning so be prepared to deal with all of those individuals the franchisor also gets the opportunity to review your plans make comments just to make sure that your plans and how it's how the unit is going to be built lines up with their brand standard now after plans generation come step number seven which is permitting now you enter into permitting as soon as the architect submits your plans for review to the agency having jurisdiction so that could be County that could be city could be Health Department could be Building Department it just depends on the municipality now simultaneously with submission to the agency having jurisdiction the architect is also going to submit your plans for bid and what that means is the architect is going to produce either a CD set or a hardcopy set of the plans for general contractors that you've pre-chosen pre-screened to review and place a bid on now this is very important you want to make sure that you at least get three bids from three different contractors now that's important because you want to make sure that the price that you're getting is a fair price and that its market value and the last task within permitting is actually pulling that per so pulling that permit has some implications on its own that could be a hinge pin for your rent commits we'll cover that in a separate video okay after permitting come step number eight which is construction now as you can imagine construction has a lot of moving parts and it's your GCSE responsibility to manage all of those moving parts now one thing that I would recommend for you to do is before you get too far into the construction you want to make sure that you get a construction schedule from the GC that will help you manage that timeline so that you are meeting your commitments per your lease agreement and you're also meeting those commitments that you made to the franchisor now at the end of construction you're going to be issued a CEO or a TCO now a CEO is their certificate of occupancy which means that the building department or the municipality in charge has said you're good to go you've fulfilled all the requirements of the permit and you're ready for opening day a TCO is a temporary certificate of occupancy and may allow you to start your training or initial inventory unloading but please keep in mind with the TCO you are still responsible for obtaining the permanent CEO now at this time you're also doing a punch list so the contractor is going to do a walk-through with you and make sure that everything is done per your lease agreement and per your contract with them all right after construction comes step number nine your grand opening so this is where a lot of the franchise or coordination comes into play so you've got marketing involved you've got operations involved you've got the training team involved all of those different departments at the franchise doors office are coming to help you and make sure that you get open in the correct way and per the brand standard now an event that usually goes on with grand opening is a friends-and-family event some people call this different things the standard industry term is friends and family that's where you have a soft opening for a scheduled day and it's by invite only you get to showcase your franchise unit to your friends and family so that's not only limited to your you know immediate friends and family but all people that helped you along the way so it could be you had a really great broker invite them to the friends and family you had a really great GC invite them make sure that this is a community and vent if you do it the right way this can be a lot of positive exposure for you now step number 10 is ongoing it's called facilities maintenance when you open the doors to your franchisee you're gonna be responsible for how the facility operates you know be sure to keep those warranties on your equipment on your roof all of those things that you paid for make sure that you keep those organized because as your unit ages there's gonna be things that break there's gonna be things that need replacement and you would be remiss if you didn't cash in on those warranties that are available to you now during the operating life of your franchise unit you're gonna have inspections you're gonna have inspections by the Health Department you're gonna have inspections by the franchisor now they're gonna come in and make sure you're operating per their brand standards with that that wraps up the 10 steps to opening your own franchise if you like this video please give it a thumbs up if you have any questions feel free to write those in the comments below and we look forward to seeing you in the next video thank you

Channel: Franchise Frankness

Views: 107,337

Keywords: Franchise, Franchising, Entreprenuership, Entreprenuerlife, business, entreprenuer, investment, smallbiz, franchisefrankness, startup, startuplife, growth, smallbusiness, success, leadership, motivation, biz, successful, businessowner, realestate, tips, advice, money, research, why, businesswoman, work

Id: VUCGnSylhyo

Length: 10min 1sec (601 seconds)

Published: Sun Mar 19 2017