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Top 3 Mistakes When Franchising Your Business and How to Avoid Them


In February 2012, Michael S. Rosenthal has childhood problems that are related to franchising. Against what you might be thinking, he is not damaged by bad experiences; he is regretful of what would have been. During 1957, which is the same year he was born, his dad Harvey launched a hot dog joint in the northern side of Chicago. One day, a young man walked in and demanded Harvey go into business partnership with him, offering him a restaurant concept worth $5,000 for a store, which the man revealed will blanket the whole nation and will make him (Harvey) very wealthy.

“My Dad had told him to get lost from his store, that there is no way he will pony up $5,000, which was a whole lot of money in those days,” says Rosenthal. “The man was no one else but Ray Kroc, the owner and founder of McDonald’s. Had it been my dad had just said yes, I would not have been working currently.”

Maybe because of this story, Rosenthal has decided to make saving wannabe franchisors his life’s work. Today he is the head of the Atlanta, Georgia franchise law practice, and he shares some of the top easily committable mistakes he observes every day. If you also decide to join the chariot of many people now investing in restaurants today, you may want to consider purchasing franchises like that of Ben et Florentine franchise Quebec amongst others. However, you need to bear these 3 mistakes in mind as you invest in your future through restaurant franchise.

#1: Confusing A Business Owner Roles with That Of A Franchisor

Rosenthal makes use of a barbecue restaurant to set an example. As a business owner, it is your responsibility to have mouth-watering pulled pork delivered; you do a good job and own legions of faithful and loyal customers. Very soon a very potential business partner comes offering to open a franchise and you immediately jump at the opportunity. Is it kind of an ace in the hole? Not particularly.

“You have to know that being a business owner and a franchisor are totally two different sets of skills,” says Rosenthal. “You might be a good chef, but that does not mean you’ll be a good franchisor.”

Franchisors must have a focus tailored to recruiting and finding franchisees, says Rosenthal. Processes have to be in place, manuals should be written and the franchisors need to properly invest enough time into franchisees training as well as reduce level employees. These obligations or duties could take you away from anyone related to colonizing your basic business.

#2: Lack Of Planning

Planning is a major key to any successful franchised business. Prior to even thinking about the business model, ensure you have a comprehensive operations business manual which goes on a step by step basis throughout every single process in the company and you have communicated with a franchise consultant or an attorney Rosenthal recommends.

“Do not just assume that you can do it well on the cheap and then see how it goes,” he added. “Franchisees need a whole lot of pre-planning.”

#3: Franchising too early

Due to the fact that your Mexican restaurant which is 5-month-old is selling out very well every night does not really mean it is about time you started thinking about good franchising. Rosenthal recommends that you wait for about three years before you consider the business model.

“You should have everything well figured out,” he says. “Nobody is willing to purchase your franchise if you have not worked out the kinks yet.”