You need to be realistic about the number of steps there are along the way to opening a franchise and the time the whole process will take.
“The typical franchisee recruitment process can take anything from a month to six months,” says David Lindsay, chief executive officer at BDC Partners.
“There are a few variables to consider, starting with how much due diligence you do. Getting pre-approval for your finance can happen quickly or take as long as 10 weeks. You might need to find a commercial property, and negotiations in this environment can take months. The shortest time I’ve seen from enquiry to opening in the current environment has been six months.”
Working through the steps
- Calculate how much you can afford to borrow.
- Decide on the right franchise for you and submit your application.
- Identify a location that gives you the potential to succeed.
- Carry out thorough due diligence, including talking to other franchisees.
- Apply for pre-approved funding. You’ll need a complete list of your personal outgoings and details of the security available to support your loan. Your lender will want to see a business plan – your franchisor should be able to help.
- Go over the legal documents with a specialist franchise lawyer.
- Finalise the legal agreement. You and your franchisor will be bound by the agreement as soon as you have both signed and you have handed over the agreed payment.
- Obtain any necessary permits, licences and insurance cover.
- Recruit and train your staff.
- Open your new business.