Why Every Business Needs To Operate Like a Franchise


By Brad Semp

One of the most popular and enduring business models is the franchise business model. More and more people are buying franchises these days. At the same time there's a growing awareness that the franchise business model is innately helpful to any business. Just as franchise systems are based on clearly established and documented operational procedures, so too would most businesses benefit from approaching their businesses as if they too were franchise systems.

The reality is that every large organization is based on harnessing effective systems. If it wasn't, it wouldn't have grown to its current size. That's not to say that every single large organization is an "optimal" system - just that systems were the key determinant of its ongoing growth and profitability. Having said that, it's often hard for entrepreneurs and small business owners to model themselves on large organizations. What they really need to guide them in business development is an "entrepreneur system" to model, which they can then capture and document in a process map, such as a Cashmap.

Well, the good news is that there is a readily available entrepreneur system that small businesses can model: the franchise system. A franchise system is essentially a network of small businesses that all apply the same operational model. Typically, the franchisor creates and perfects a system for operating a specific type of enterprise. In order to grow the business, the franchisor raises capital by selling to others the rights to replicate this business system. Consequently, franchisees buy the right to be trained in, and apply, the tried and true system developed by the franchisor. As such, the franchisee can produce the same products and services as any other franchisee.

The power of the franchise model for an entrepreneur - who may or may not ever want to grow their business into a huge company nor, indeed, franchise their business - lies in the idea that systems produce predictable results. It logically follows that if you have methods of producing highly desirable results - for example, great quality products and services, not to mention high sales and profits - these should be systemized in your business. In fact EVERY element of your business can be perfected and systemized in order to produce the results you want.

By using a Cashmap, a business owner can document each process or system in their business, whether it's how to perform certain tasks... create new products... greet customers... or literally anything that has a direct or indirect impact on business performance. This effectively gives you a "blueprint" for ongoing business development, with the end result being a business that operates in a predictable fashion, yielding predictable results. Meanwhile, by continuing to actively improve these business systems, you can ensure that the business continues to grow and improve too.

Whether it's a Fortune 500 company, or a highly successful franchise network, a successful enterprise relies on systemizing every organizational and operational element that affects business performance. So too, as an entrepreneur or small business owner, it's wise to develop and implement systems in your business.



 
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