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How to turn your business into a franchise

Use our quick guide and learn how to make your franchise a success.

Franchising is a billion-dollar sector in Australia, with brands like Subway, Bakers Delight, The Coffee Club and Gloria Jean’s in countless locations around the country. So there’s plenty of inspiration for small business owners to see franchising as an expansion opportunity.

Will your business model appeal to franchisees?

Potential franchisees won’t be interested if you can’t demonstrate that your business is successful and your brand is marketable. You should have a proven track record of success and profitability over a significant period of time, and be able to back it up with hard data.

In addition to being financially successful, you need a reason for potential franchisees to use your brand. Your brand must be unique, highly credible or widely recognised – and ideally a combination of all three. If you can prove that your business’s success can’t be easily replicated, and will generate a positive return on investment, you may be ready to franchise.

Take a good look at market conditions. Is the demand for your product or service growing or slowing? Establishing a franchise in a growing industry is far easier than in a shrinking market dominated by established players.

Can your franchisees be as successful as you?

If you can tick off successful, credible and marketable, consider how your franchisees will replicate your popularity. You may only have a few weeks or months to teach the operator everything they need to know about your business. As such, verify that your success isn’t due to non-transferrable assets like your special location or your unique personal skill set.

If your procedures and operating systems are clearly documented, and you’re available to provide ongoing support, chances are an intelligent, capable franchisee will meet expectations and add value to – rather than depreciate – your brand.

Need some help?

If you believe your business meets the mark, it’s time to consider how you can establish a successful franchise. While you may be an expert in your industry, you’re about to start a business in an entirely new space: the business of marketing, selling and supporting franchises.

You’ll need a lawyer to assist with drafting franchise agreements, applying for trademarks, registering your franchise and general advice regarding your legal obligations as a franchisor.

You may also require the advice of franchise consultants. These people can help startups access all the information they need to succeed. It’s best to enlist them straight away, as they can analyse your business’s viability, help you understand the franchising process and establish a strategic plan to meet your goals.

Recruiters or HR consultants can help with putting your franchise team in place. PR and marketing consultants are useful for exposing your brand to potential franchisees, and expanding brand awareness among potential customers.

There are some initial startup costs when franchising, so talk to Prospa about a small business loan to fund your dream franchise operation.


The information in this post is provided for general information only and does not take into account your personal situation. You should consider whether the information is appropriate to your needs, and where appropriate, seek professional advice from financial, legal and taxation advisors. Although every effort has been made to verify the accuracy of the information as at the date of publication, Prospa, its officers, employees and agents disclaim all liability (except for any liability which by law cannot be excluded), for any error, inaccuracy, or omission from the information for any reason, including due to the passage of time, or any loss or damage suffered by any person directly or indirectly through relying on this information.

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