Growing a business is a journey full of decisions, and choosing the right growth strategy can feel overwhelming. One of the most important pieces of advice I can share as a leading franchise and business consultant is to have your endgame in mind when you begin.
Where do you want your business to be in five years? Are you building a business that stays small and local, or do you envision a scalable enterprise? If expansion is part of your vision, franchising could be the pathway to achieving it, potentially sooner than you expect.
It should be said that not every entrepreneur I work with has ambitions of market domination. Many simply want to meet current demand or expand into new locations without the burden of managing remote teams. Franchising offers a way to grow while partnering with invested individuals who share your vision.
The real question isn’t whether franchising is a viable option; it’s whether your startup is ready for it.
For some business owners, success means adding a handful of franchised locations with minimal involvement from the head office. For others, it’s about building a recognized brand and stepping away from direct operations to focus on strategic growth.
As a franchise consultant specializing in small business growth models and startups, I’ve been lucky enough to work with many business owners across Australia and New Zealand to turn their early success into long-term sustainability.
With nearly three decades of experience in starting and running my own companies, both franchised and independent, as well as leadership roles in some of Australasia’s best-known brands, I’ve seen what works and what doesn’t when it comes to franchising for startups.
Perfect timing
One of the most common questions I hear is whether a business can franchise early on. In Australia and New Zealand, franchising is a well-established model, with both countries having some of the highest franchise penetration rates per capita. The real question isn’t whether franchising is a viable option; it’s whether your startup is ready for it.
The first key factor is demand. No matter where your business is based, a steady stream of customers is essential. A franchisee needs confidence that they’re investing in a business model with real market potential, not just an idea that works in one location.
A franchisee needs confidence that they’re investing in a business model with real market potential, not just an idea that works in one location.
Another crucial element is financial viability. Your business or financial modeling must demonstrate consistent profitability to be suitable for franchising. Strong profit margins ensure the model is sustainable for both you and your future franchisees. If your business is barely breaking even, franchising won’t solve the problem; it will only multiply inefficiencies.
Equally important is systemization. A startup is franchise-ready when it runs on repeatable systems that ensure consistency. Efficient processes simplify training, eliminate operational guesswork and allow the business to scale smoothly. If your business depends heavily on your personal involvement or lacks clear procedures, it may need further refinement before franchising.
Growing a community
A common misconception is that a brand needs to be well-known before it can be franchised.
In reality, franchisees are often more influenced by the franchisor’s leadership, passion and commitment to the business than by brand recognition alone, and this is because most franchisees are, to a certain extent, risk-averse, seeking a proven system for success, unlike true entrepreneurs who embrace uncertainty, take risks and learn from their mistakes.
They want to be part of something with real potential where their investment feels valued and they have direct access to mentorship and guidance.
This is where startups can hold a competitive advantage. Some larger franchise brands have evolved into purely ‘franchise businesses’ rather than companies focused on grooming dogs, serving great burgers, mowing lawns or building homes. At a certain scale, the primary business becomes selling franchises.
If your startup offers real opportunities for learning, growth and personal development, you’ll attract the right kind of franchisees: motivated individuals who want to contribute to and benefit from the brand’s success.
In contrast, smaller networks often provide hands-on support, fostering collaboration and stronger relationships between franchisors and franchisees. This close-knit approach is often more attractive to franchisees looking for meaningful engagement rather than just following a playbook.
There is a common saying in franchising: ‘In business for yourself, but not by yourself.’ The most successful franchisees aren’t just looking for a business to buy into; they’re looking for a community. If your startup offers real opportunities for learning, growth and personal development, you’ll attract the right kind of franchisees: motivated individuals who want to contribute to and benefit from the brand’s success.
Leading with vision
Franchising isn’t just about replicating a profitable business; it’s about creating a structure that attracts the right partners, fosters collaboration and sets the foundation for long-term growth. I’ve seen that startups committed to continuous improvement and innovation are better positioned for long-term success.
Actively seeking feedback from franchisees and customers helps identify opportunities for refinement. Embracing technology and adapting to market trends also keeps the business competitive and resilient.
Thriving as a franchisor isn’t just about running a profitable business; it’s about leading with vision. Franchisees are investing not just in your brand but in your ability to guide them toward success. Clear communication of your long-term goals fosters confidence and alignment across the network.
Strong leadership is the foundation of a successful franchise system. By demonstrating transparency, commitment and integrity, you create an environment where franchisees feel valued and motivated to perform at their best.
By focusing on the fundamentals such as profitability, systemization, brand quality and leadership, you can create a franchise that not only expands but thrives.
This starts with comprehensive initial training, equipping franchisees with the knowledge and tools to operate effectively. But training shouldn’t stop at onboarding. Ongoing support in areas like operations, marketing and business development keeps franchisees engaged and growing. Tailored coaching that addresses individual challenges fosters a culture of continuous improvement and innovation.
Equally important is maintaining open lines of communication. Franchisees need to feel heard, supported and part of a collaborative culture.
Regular network catch-ups that give franchisees the opportunity to share insights, challenges and successes within their businesses, along with providing meaningful guidance, answering questions and assisting with strategic planning, strengthen the relationship between franchisor and franchisee, ensuring long-term success for both parties.
Franchising isn’t the right fit for every business, but for startups with a scalable model, strong demand and a commitment to structured growth, it can be a game-changer. By focusing on the fundamentals such as profitability, systemization, brand quality and leadership, you can create a franchise that not only expands but thrives.
