You want to franchise your restaurant: Now what?

May 1, 2012 | by Harold Kestenbaum
You want to franchise your restaurant: Now what?

In my last blog, we discussed why your restaurant should be franchised. I will assume that you have listened to what I said and you have now made the decision to become the next McDonalds or Dunkin Donuts. Great choice, and you will not regret it, but, now that you have made this decision, what comes next? This blog will discuss the next key steps in the life of a restaurant franchise company.

Presumably you have read my book, "So You Want To Franchise Your Business," and will take the advice I give in the book. But, for the sake of this blog, I will assume that you have not gone onto and spent the $20 to buy it.

The first key step is selecting the right professionals who will guide you down the franchise path. I implore you to do this, since most restaurant owners who choose to franchise their restaurants have never done it before and really have no idea what comes next.

If you ran a restaurant franchise before, you can skip down to the end of the blog. There are highly experienced franchise consultants out there who have been down this road before and who can provide you with the proper guidance and roadmap so you will have the right tools to make your restaurant franchise successful. But first, you need to keep this mantra in mind, you are no longer in the restaurant business, you are in the franchise business.

What does this mean, you ask? Well, let’s try to simplify this. You are a very successful restaurant operator, and now you want to grow your restaurant into the next Subway or Panera Bread. In order to do this you will need to remove your chef’s hat and become a true business person who will be running a chain of restaurants that will be owned and operated by someone else (your franchisee). I am not going to get into great detail here, because that will be my next blog. Suffice it to say that you need to have your trusted General Manager run your current restaurants while you focus your attention to growing this brand.

Now, back to the professionals. You need to hire an experienced franchise consultant who will guide down the franchise path. Make sure you select one that has lots of food clients and knows the restaurant business. I think that is key in determining which one to hire. Remember, this consultant is going to help you write that all important Operations Manual that your franchisees will live and die by. They also will help you strategize your growth path and offer some other very important advice.

Once you have selected the appropriate franchise consultant, you then need to hire the franchise attorney. This selection is just as important as the consultant. So choose wisely. Geography does not mater. You need an experienced franchisor attorney, not one who dabbles in franchising or one who represents both sides, the franchisee and the franchisor. That would be a huge mistake. Go on the Internet, ask the consultant, but make sure you find one who you are comfortable with since that attorney may be at your side for many years. I personally have clients who I have represented for decades. Your franchise counsel will help you navigate the regulatory aspects of the franchising process. More about this in my next blog. This franchise attorney will provide almost daily advice on what you can do and say and what you cannot. A very important and trusted advisor.

The last professional that you will need to have on your team is a good accountant and one who has represented franchisors before. There are no many who have, but I highly recommend finding one who has.

These next steps will go a long way in determining the success or failure of your restaurant franchise. Make wise choices, and make sure that you do your due diligence.

Topics: Business Strategy and Profitability, Franchising & Growth, Operations Management

Harold Kestenbaum
Harold L. Kestenbaum is an attorney who has specialized in franchise law and other matters relating to franchising since 1977. He is a partner with the national law firm, Gordon & Rees, LLP and is engaged exclusively in the practice of franchise distribution and licensing law, representing exclusively franchisors, both start-up and established. He is a member of the Gordon & Rees Franchise, Distribution and Hospitality Practice Group. www

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