Publisher's Comment

Professor Roy Seaman Managing Director and Founder of Franchise Development Services

If you own a business which could replicate its success on a national scale, developing a franchise could offer the most effective route to capturing the UK market. Here are 10 great reasons to franchise your business in 2010!

1. Faster national expansion - Having established your business as a franchise, your network can grow quickly because franchise owners' capital will fund new outlets.

2. Better motivated operators - By choosing franchising as a means of business expansion, you can take benefit from owner operators' ambition, energy and commitment to the business and its standards.

3. Get the edge on competition - By quickly expanding into new geographical areas, you are well placed - as long as your product or service is good enough - to take your competitors' customers, and keep them.

4. Effective quality controls - As all your franchise owners are following the same system, customers throughout the network should receive the same high quality service, irrespective of location.

5. Rationalised management - Running a franchise system requires less management than a company owned chain of outlets, since hiring, training, motivating and retaining competent staff are all functions handled by the franchise owner, not the franchisor.

6. Local knowledge from franchise owners
Expansion through franchising passes the main responsibility for evaluating a new territory on to the franchise owner, who probably already possesses a great deal of valuable local knowledge.

7. Group purchasing strength - Centralised buying allows your entire network to benefit from volume discounts that an independent trader would be unable to obtain.

8. Dedicated distribution network - If you are a manufacturer or service provider, establishing the sales function of your business as a franchise operation provides you with a distribution network entirely focused on the supply of your product or service to customers.

9. Marketing power - As your network develops, all your outlets can benefit from the group's marketing initiatives, both at a national and regional level. A positive network spirit will encourage franchise owners to help one another through referrals as your customers become increasingly familiar with your brand, expanding on a national level.

10. Improved profitability - The return on investment can be higher for a business that expands through franchising. Because there is less capital employed, the franchisor's profits are generated on a much lower capital investment. Although the revenue received from franchised units is logically less than that from 100% company-owned outlets, a higher percentage of the revenue is actual profit.