Are you the owner of a resort and planning to expand it across the country? Instead of opening a lot of units for your brand, thinking of setting up a franchise unit will be ideal. Franchising is one of the best and most efficient ways to expand your resort business countrywide. It allows others to run their hospitality businesses under your resort name and offer your services. Thus, it helps you to expand your resort brand name across Australia. But before you think about how to expand your local resort across the country, you must consider a few things beforehand.
Wondering what are those essential things that you must consider before franchising your resort? Let’s dive into the following blog post to know more about that.
The top 7 things you must consider before thinking of franchising your local resort
Franchising may seem easy, but let us tell you that franchising is tougher than you think.
As per the latest data, the rate of franchise failure is as high as 50% and as low as 20%.
So, if you don’t consider a few things beforehand, it’d be tough to franchise your resort.
The following are some of them,
1. One of the most essential things you must consider before franchising your resort is the business’s popularity. Franchisees would love to invest in a business that’s already popular. Data shows that the Australian hotel and resort market has grown 5.2% per year over the last 5 years (2019 – 2024) and also is expected to grow at a CAGR of 4.07% during 2024 – 2029. Though this data is lucrative, you must consider the popularity of your resort within and outside of the local community before thinking of franchising it.
2. Another vital thing you must consider beforehand is capital. Though the franchisees would be the ones to make all sorts of investments, you still need funds to train your franchisees and draft the legal paperwork for franchising your resort across Australia.
3. Apart from that, you should also consider the revenue before franchising your resort. Data reveals that the hotel and resort market in Australia is projected the revenue of USD 7.03 billion in 2024 and is expected to reach up to USD 8.58 billion by 2029. Though the stat is enough to attract potential franchisees to hotel and resort franchise models, you should ensure that your brand revenue is lucrative enough to attract them towards your brand.
4. As per the latest rules and regulations, preparing legal paperwork like FDD (Franchise Disclosure Document) and FA (Franchise Agreement) is a must to sell your franchises to anyone. Thus, you must draft these documents by a professional franchise lawyer and be sure that they’re up-to-date, including every small to smallest vital detail about your resort business.
5. It’s a must for you to check if your business is scalable and replicable or not before thinking of franchising it. Consider checking your resort business and reviewing if your business model can run without your physical presence or not. If not, then it won’t be ideal to expand your brand yet.
6. Hiring the right franchisees is also essential before franchising your resort business. Most people tend to hire their friends and family members as the franchisees for their franchise models. Well, you can do that as well but if only they’ve got the potential to run franchises in the right way. Experts suggest hiring someone more interested in growing with you than getting rich fast.
7. Last but not least, consulting your franchising matter with a professional consultant would be helpful. Having years of skills and experience, they can review your business model and check if franchising would be ideal for your resort business or not. They can also help you with other vital tasks like franchisee recruitment and legal document preparation.
Bottom line,
Do you run a luxurious resort and want to expand your business across the country? Well, thinking of setting up a franchise unit for your resort business would be helpful. Yet, you need to consider some facts beforehand.
Author Bio: The Author is a proficient franchise consultant. For years, he’s helped many people to expand their businesses by setting up a franchise unit. Also, he’s written many articles and blogs on the same.
Thinking of Setting Up a Franchise Unit for Your Resort? Be Sure to Consider These
