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How to Franchise Your Business

Offering and selling franchises is an excellent growth strategy.  Execution requires proper planning and operational excellence.  Can you follow these 8 steps to franchise your business? 

Follow these 8 Steps to Franchise Your Business

The first step in how to franchise your business is evaluating your business

Evaluate your Business for Franchise Success

Franchise brands cover almost every category of products and services.  In 2022, it is estimated that there will be over 792,000 franchise establishments in the United States. You've demonstrated that your business is sustainable through company outlets, but is it scalable through franchising?  Is your model easy to replicate and can you train others to follow your systems and methods to be successful in business?  Consider reading the book Franchise Your Business by Mark Siebert for experienced based tips for evaluating your own business for franchising.  

The second step in how to franchise a business is to evaluate the team

Evaluate Yourself and Your Team

So, your business is a great candidate for franchising.  Are you ready to put in the sweat equity and financial capital it will take to be successful as a franchisor?  Franchising is not a get rich quick scheme.  


  • Eight out of ten franchisors have less than 100 locations.  
  • Many peak before they reach profitability.  


Are you committed to putting the right team in place and grinding it out to grow, mature, and solidify a franchise brand?  You will only be successful if the franchises you sell are successful. Understand the commitment and drive this will take.  

The third step in how to franchise your business is to protect your intellectual property

Protect your Intellectual Property

Is your business branding protected by a federally registered trademark?  If not, you need to evaluate the protectability of your marks. If you can't protect the brand, you may need to change your marks. As a franchisor, you will be licensing your marks to franchise buyers | franchisees. You should protect your brand before you invest in building the brand.  

The fourth step in how to franchise a business is preparing legal documents |  franchise attorney

Prepare the Legal Documents

The offer or sale of a franchise is unlawful unless it is made through disclosure of a legal document known as a franchise disclosure document ("FDD").  Franchisors are regulated by state and federal franchise law. Feel free to browse our site to gain an understanding of what goes into the FDD. The legal requirements will depend upon your state and the states where you would like to offer franchise opportunities. The FDD will include a contract establishing the franchisor | franchisee relationship, known as a franchise agreement.  Consider engaging a franchise lawyer | attorney to prepare and maintain the FDD.  Any franchise attorney can represent franchisors nationwide. 

The fifth step in how to franchise a business is documenting the business processes

Document Your Process

What does it take to replicate your business as a franchise buyer | franchisee? What elements of doing business are optional and what elements are essential?  You will need to organize all of your methods, systems, and process to create an operations manual (print, online, or both).  The manual will include your standards and specifications, along with any approved or designated vendors, and should guide franchise buyers | franchisees through the operation of their franchised business.  This is the franchise buyer | franchisee "how to guide" for operating a business just like yours.  You will also need to develop an initial training program to prepare buyers for the launch of their own franchised business. 

The sixth step in how to franchise a business requires a commitment to compliance

Commit to Compliance

Legal complications can be detrimental to any new business. Troubles for franchise sellers | franchisors can come from litigation or through regulatory action. There are two primary concerns:


  1. Costly litigation
  2. Disclosure requirements


If the franchise business | franchisor survives the litigation or regulatory action, unfortunately, thats not the end. Franchise law requires disclosure of all litigation, including state action, in the FDD. The sales team will have to overcome these details when trying to sell franchises to new buyers. 


Understand all legal requirements to comply with federal and state franchise law and create a culture of compliance. Train your team and help them understand the legal requirements for advertising, marketing, and offering franchises.  Document compliance. Consider having a franchise lawyer | attorney engaged for ongoing legal support as the law department for your business. 

The seventh step on how to franchise a business requires franchisors to develop a strategy.

Develop a Strategy

Success doesn't come by happenstance.   Franchisors need to plan for success.  Commit to operational excellence when developing your strategy for franchising.  


  • Develop your business plan. 
  • Find your target markets. 
  • Create a timeline. 
  • Start looking for prospective buyers | leads. 


The eight step in how to franchise a business requires execution of the strategy.

Execute the Strategy

Align your operational support with your growth and insure that your initial growth and development occurs at a healthy rate. Selling franchises is important to growth, but actually delivering results and supporting franchisees is essential to sustainability.  Proving the concept through a company owned outlets is great, but the franchise business must prove that the system can be replicated to grow. Franchised locations need to be validators.  Focus on selling franchises to the right people at the right time.  Happy and successful franchisees will be your biggest supporters. Make sure your opportunity is the right opportunity for each franchisee. 

Contact our Franchise Lawyers Today!

We Are Available to Answer your Franchise Law Questions

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