In a previous post, we shared food franchise businesses you can try to jumpstart your entrepreneurial dreams. This is a good idea especially if it is your first time in the business world. You want to gain experience first in running a business with minimal risk because you simply have to follow a time-and-tested business model. At this point, you already did your research and decided to go for this particular franchise.
What’s next?
You start your franchise business application. Although the process depends per franchisor, here are major steps you need to do to make this happen:
Step 1: Reach Out to Your Chosen Franchisor
This is exactly what you need to do to get into franchising. Keep in mind that each franchisor require different sets of documents, charge certain fees, and follow a particular arrangement. Even if some details are listed on their website, there are other information that are not disclosed (especially the fees) and talking to your target franchisor directly will keep you informed.
Give them a call or send them an email regarding your intention to franchise. Set up a meeting for further concerns. You can also attend Franchise Expo where you can talk to company representatives directly. The expo usually happens during the first half of the year so if you are in the country, do check out their schedules as well.
Just make sure your chosen franchise is a legitimate business. You may check the list of companies that are open for franchising here.
Step 2: Prepare the Requirements
This is an important step. The requirements you will be asked to submit could dictate whether or not the franchisor will approve your franchise application, so you need to wow them at this stage.
Franchisors have their own set of requirements. Nonetheless, below are the most commonly-requested documents:
- Completed franchise application form, which is commonly found in the company’s website
- Letter of Intent or LOI, which states your reasons for applying for a franchise. There are also franchisors whose LOI sample is available in their website, so do check it out.
- Vicinity map of your proposed site, with the help of Google Maps. It is best to attach pictures of the actual site as well.
- Resume of the franchise applicant
- At least two valid government-issued IDs.
Aside from these documents, some franchisors will ask you to submit any of the following:
- Lease Contract or Written Agreement with the Lessor, if you will be renting a space for the site
- Latest bank statements (to check the availability of funds as business capital)
- Proof of billing under your name
- Business registration documents like Mayor’s Permit and DTI Certificate (if sole proprietor)
- Taxpayer’s Identification Number
Step 3: Meet the Franchisor
This is another crucial step. Meeting with the franchisor is where they will assess your franchise application and inform you if it is a go. Franchisors need to assess whether you are a good fit to be their business partner, which is why you need to impress them as well.
Here are some of the things that happen during this stage:
- Discussion of the franchise details, including the qualifications needed as a franchisee
- Inspection of the proposed site
- Next steps you need to undergo such as trainings
Step 4: Signing of the Franchise Agreement
Finally, you passed and you are on your way towards becoming a franchisee. Don’t get too excited yet. You need to review the Franchise Agreement first before you sign the document. Consequently, you need to pay attention to the following details:
- Franchise term, including renewal term and costs
- Fees and costs such as franchise fee, bond, and royalty fee among others
- Inclusions in the franchise package
- Grounds for termination of the Franchise Agreement
- Franchisor-approved suppliers and products
“I don’t have sufficient funds to even get a franchise. What’s my next option?”
Well, Balikbayad is here to help. Fill out our online application form for pre-processing and we will get back to you as soon as we can regarding the status of your loan application. We can lend as much as P500,000 and allow us to be your partner in making this entrepreneurial dream happen.