Forums: Discussions for entrepreneurs and small business.

Hi Everyone,

I created a brand name health club called Vanity Health Clubs and I want to start my research to begin franchising it. Vanity is the first Designer Health Club Specializing in Cosmetic Fitness.  Vanity is a themed health club designed to be visually inspirational, and fuses  elements of the hospitality, entertainment, and fitness industry into the health club creating our unique brand of services.  We are much more service oriented than most other health clubs, and are current ventures have had huge success!

So how do I franchise my business?  I know there are a lot of different companies, which ones are good?  What are the different ways to approach this? What are the costs and fees associated with franchising a business?  Can I just use a lawyer? Should I consider franchising before I explore Angel Investing? Or Vise Versa? 

Thank you so much for your time,

Alan Forte
Owner, Vanity Health Clubs
www.vanityhealthclubs.com

Alan --

I see that your post was nearly 3 years ago, so this response may be well past being useful, but here it goes ...

There are a number of ways to franchise your business, most of which can be a good idea, given the right circumstances.  There are several franchise consulting firms that will help you identify a structure, organize logistics and identify management and operational issues that you'll need to put in place.  Some are very good.  Others are not.  I would be happy to provide the names of some people that are well-respected in the industry.  Do you HAVE to use a consultant?  No, but if you don't you need to be confident that you have the necessary abilities to fill that role already available in house.

As far as lawyers go ... I am a franchise lawyer ... feel free to be skeptical of my views on this.  It is absolutely indeispensible to have a franchise lawyer involved early on.  And, yes, they really do need to have a substantial background in franchising.  Personally, I would make sure that the lawyer you are working with has written franchise agreements and disclosure documents before and worked with each of the states that require registration. 

Doing franchising right is not cheap.  I think you can count on at least $20,000 in legal fees alone.  If you use a consultant, you can probably plan on at least that again and up to $100,000 for the consultant.  I usually tell people at this point to beware of the so-called "packagers" who say that tehy will do everything for you for a low-low-low price ... possibly combined with a commitment on your part to pay a portion of the royalties in perpetuity.  I would be happy to explain my aversion to these arrangments, if you like, more directly.

If you are interested, I have a list of 5 Commandments for New Franchisors on my website ... http://www.maslynlaw.com/5-commandments-for-new-franchisors/ .

Good luck!

Patrick Maslyn

Maslyn Law PLC

www.maslynlaw.com

 

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I find there are many consultants who are "experts" at their piece of franchising (legal, marketing, etc) - but don't have a good grasp on the wide variety of skills required to package a franchise.  I found a company call Signature Franchising that all they do is franchises - they have boilerplated much of the process and can therefore provide you more service for less money.

 

Good luck.

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Ed
Business Optimization - www.businessoptimization.biz