“Should I franchise my business overseas?” It’s a question every major business owner has asked at one point or another.
Franchising overseas can be immensely rewarding. But, it’s a decision that could make or break your business. It requires extensive research as well as financial and human resources. It should therefore never be a step into the dark.
Here are the factors to consider when deciding whether to franchise overseas, and how location intelligence can become a critical resource in the decision-making process.
What factors do I need to consider?
Before you even think about overseas expansion, you’ll need a strong foundation at home.
Deploy location intelligence to:
· Check performance of existing businesses and decide where potential efficiency savings can be made
· Analyse logistics/distribution models and whether they can stay operational with minimal input
· Establish a financial plan to sustain your business in your absence and overcome initial turbulence overseas
You and a number of your senior employees are likely to be fully engaged in a start-up-like environment for a number of months while establishing overseas operations. Factor in the cost of losing or replacing these skills temporarily.
Many countries lack specialist skills in specific areas, making it difficult to find the requisite number of capable staff. You need assurance that there will be enough staff to conduct operations effectively.
Use location intelligence to estimate:
· How many staff are currently employed in a specific role
· Where these people are based in the highest concentrations
· What typical educational experience is within a given area
· How many staff established businesses in your industry are likely to employ already
Cultivating a business partnership with a local resident or commercial entity is another effective option to use in tandem, helping to provide market understanding and facilitate sales from the earliest possible stage.
You need a comprehensive market understanding to work out whether franchising overseas would be financially advantageous.
Location intelligence enables you to:
· Scour social media to establish how frequently your product/service is discussed, and in what terms
· Establish where competitors are based and whether the market is already fully served
· Use competitor data to find out whether your product/service is already purchased regularly in the region
Research local laws and business incentives to establish how much red tape you’re likely to face, what kinds of quality assurance documentation you’ll require and what the situation is with import/export duty.
Aside from the market, you’ll also need an in-depth understanding of both localised and national cultures. This can establish whether you’ll need to invest in adapting your product, service and/or sales model in order to optimise it for this region.
Location intelligence software provides insight faster
Only once you’ve gathered and analysed data relating to all these factors can you truly determine whether now is the right time to franchise your business overseas.
But, this process can be time-consuming without the right tools in place.
Advanced location intelligence software can help you make sense of this faster and take strategic action based on in-depth map-based visualisations.
Gain the insight you need to answer that timeless question of CEOs: “Should I franchise my business overseas?” by setting up with Periscope®.