How to Start Franchising

Selling Franchises

Written by Ed Teixeira for Gaebler Ventures

Selling franchises is the final but most important step in setting up a franchising opportunity that you will offer to entrepreneurs. If you fail on this step, all your prior efforts will be for naught.

In this last article in our five-part series on the steps to franchise a business, we offer a few tips on selling franchise opportunities to aspiring entrepreneurs.

Selling Franchises

Selling New Franchises

All of the work that you’ve done and the initial capital you’ve invested is to bring you to the point where you can start to sell franchises.

When clients ask my advice for selling franchises from a start-up operation, my response is always the same: “It’s a function of the capital that you have available for the franchise sales process.”

You’ll need to have a franchise response packet which is an information packet that can be mailed to franchise prospects. Be sure you have a web-site that can present your franchise opportunity in an attractive and effective way.

Your franchise attorney will guide you in the legalities of using a web-site to offer a franchise opportunity. If you have a limited amount of working capital to devote to the sale of new franchises, my advice is to consider existing employees or even a family member who may wish to be one of your new franchisees.

Many clients with an existing business tell me that they have an unsolicited network of several people who would like to own a franchise. This can help you start your franchise program without expending a great deal of your capital advertising for leads.

If you have the capital to devote to generating leads for franchise prospects consider the following:

  1. Your existing web-site can be used by increasing traffic on your site
  2. Franchise internet sites
  3. Seminars
  4. Franchise handbooks or directories

You’ll need to have a franchise sales process which will include recording leads, qualifying prospects and working with candidates right up to the franchise agreement being executed.

There are a number of details that need to be completed before a company can start selling a franchise. The items discussed above provide the more important steps which need to be taken before becoming a franchisor.

The total amount of capital to start up a new franchise operation including the proper staffing and advertising is approximately $150,000-$200,000. However, keep in mind that you’ll be expecting your new franchisees to invest anywhere from $75,000-$150,000+ so the amount for your investment is reasonable.

Ed Teixeira is President of FranchiseKnowHow, LLC, a franchise consulting firm; and a managing principal in the Bridge Business Broker Franchise Company. He may be reached at (631) 246-5782 or at

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