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The label of professional services encompasses various businesses, including coaching, consulting, accounting, IT, and advisory services. The UK professional services market is fiercely competitive and worth billions. Franchising is a business model that offers business owners a pathway to brand growth. Franchisees would independently run their businesses under your franchised brand. This model enables professional service providers to expand their brands without increasing their workload. This article will explain how professional services business owners can grow their brands using the franchising model.
1. Assess Franchisability
The first step is to consider whether your business has a successful track record. Consider whether your customers are satisfied with your services and whether your business has a history of profitability. Franchisees will look to invest in franchise opportunities that are most likely to be successful, and profitability is a good indicator of this.
The next step is to assess whether your business model is franchisable. Franchising is a specific business model suitable only for some businesses. Your assessment will involve determining whether your business model is simple enough for others to copy.
You must then consider whether sufficient demand for your brand’s services exists elsewhere. For example, if your professional services business works well in one region, this does not mean it will work well in another. Your services may be relevant to a specific market in a particular area, and franchisees in new locations may not be able to generate a sufficient market in a new location. However, if you determine there is plenty of demand for your business model elsewhere, your business may be fit for franchising.
2. Prepare Legal Documents
Your legal documents, including the franchise agreement and franchise operations manual, form the basis of your relationships with franchisees.
The franchise agreement is the contract you will share with each franchisee. Once a candidate signs the agreement, they are a franchisee within your brand, and you are bound by the terms of this agreement. Within it, you will set out aspects such as:
- your rights and responsibilities and those of the franchisee;
- the duration of the agreement;
- training and support provisions; and
- termination and renewal terms.
Within your operations manual, you should detail all policies, operating procedures and processes franchisees must follow. Using this comprehensive document, franchisees will run a business offering your brand’s range of professional services, meeting the standards you set.
Discover the key legal and commercial issues to consider when buying a franchise.
Seeking legal advice early on can protect your business from risk. The best way to mitigate risk is to prepare these crucial documents alongside a lawyer. A lawyer can draft these documents for you, ensuring clarity and compliance.
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3. Further Preparation
Beyond preparing the relevant legal documents, you should take further steps to prepare your business for franchising. These additional steps involve organising training and support provisions.
You are responsible for training and preparing your franchisees to perform their roles. You will need to create a comprehensive initial training programme. Training can take many forms, including classroom-based and practical learning. When planning training provisions, consider teaching aspects such as:
- your brand’s values;
- the professional service provisions;
- specific processes franchisees will need to know;
- customer service standards; and
- employment and recruitment procedures.
Beyond formal training, you are also responsible for supporting your franchisees in their roles. Support can take many forms, such as operational and marketing assistance and additional training sessions. You should detail the training and support provisions in the franchise agreement and operations manual.
4. Recruitment
Recruitment is the final consideration before you formally begin franchising. You need to find prospective franchisees who want to run independent professional services businesses under your brand.
You will market and advertise your franchise opportunities to find potential candidates. Once you find somebody suitable, invite them to complete a formal application and interview them. Remember that a vital consideration at the recruitment stage is whether you can share a long-term working relationship with this individual.
Key Takeaways
Growing a professional services business can result in an expanding workload. However, the franchising framework means that franchisees are responsible for the daily operations of their new locations and for providing services in their area. Franchising a professional services business will involve:
- considering whether franchising will suit your business model;
- seeking legal advice;
- drafting legal documents;
- preparing training and support mechanisms;
- advertising franchise opportunities; and
- recruiting franchisees.
If you plan to franchise your professional services business, LegalVision’s experienced franchise lawyers can assist as part of our LegalVision membership. For a low monthly fee, you will have unlimited access to lawyers to answer your questions and draft and review your documents. Call us today on 0808 196 8584 or visit our membership page.
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