If you are considering expanding your business by using a franchise system it’s hard to know where to start.
You may have a strong brand, tried and tested services and a great product but if you want to expand by franchising your business, there are a number of things to consider first. We have compiled a step by step guide with resources to help you on your journey.*
*Please note that content in external links is not the responsibility of Horner Downey & Co and professional advice should be obtained before acting on any information contained.
Do your research.
Franchising your business is a big step and will require planning, budgeting and, for the best results, bringing in expert help.
You can start by looking into case studies and companies similar to your own who have set up franchises. Or attend a seminar or webinar to get you up to speed. Here are some seminars and key websites to get you started:
Thoroughly document your processes and procedures.
You need to make sure that all aspects of your business and recorded and documented; from your processes, branding and the systems used. This may be easy to do if your business has simple processes, but for more complex structures you may need to complete business process mapping to show how all the moving parts and processes in your business connect.
The ideal way to do this is to compile an operations manual. This will act as a how-to guide for franchisees of your business. Take a look at these great guides to setting up an operations manual:
Trade Mark as much as possible.
Name, logo, colours or intellectual property should all be protected. This may require tweaking some of your existing branding to enable it to be trademarked/patented/ copyrighted or have a design right. Not sure what counts as Intellectual Property? Read more here:
Test your model
Running a pilot model will help iron out any issues. A pilot model will help tweak your franchise offer so you know that any subsequent franchisors will have success. Experts recommend running a pilot model for at least a year, particularly if there are seasonal fluctuations in business:
Check the regulations.
While there is no formal regulation, the British Franchise Association has a set of self-regulation guidelines. They ensure that all members sign up to a code of conduct and in return provide training and guidance.
Find an accountant with specialist franchise accounting services.
There are specific franchise fees and taxes when running a franchise operation, as well as reporting requirements.
Partnering with a chartered accountant with experience in Franchise Accounting is the most sensible approach to ensure your business is compliant and above board, particularly when it comes to HMRC and tax. Horner Downey are both Chartered Accountants and British Franchise Association accredited, meaning we have the expertise and authority to always act in your best interest.
Want to know more about franchising your business and our expert franchise accounting services? Contact our friendly, expert team today.
Whether you’re looking to take on a franchise or want to replicate your business, we’re the experts in franchise accountancy.