Converting an Existing Business to a Franchise

Running your own business is a challenge -- and taking your business idea from dream to reality is an accomplishment to be proud of. But sometimes, your business grows to a certain point, then stalls -- and you don’t know what to do to take it to the next level. Converting your business to a franchise can be the solution that gets your company’s engine going again.

That’s what led Jared Dean to the franchise system 3 1/2 years ago. “We got to a point that where we were hitting the ceiling of not being able to grow,” says Dean, who bought a heating, air conditioning and plumbing business from his father-in-law in 1999. “I was familiar with the One Hour brand, [so] we decided to join forces with them to have better [business] tools and a company model we could follow.”

The conversion was practically seamless. “It went off without a hitch,” says Dean. And they attracted attention: “We made a big deal about it in our local news and press releases,” Dean remembers. “It was amazing.” After having just one van repainted with the new brand, the community noticed immediately. “The brand is really recognizable,” says Dean. “We knew within a week the brand was really working.”

The advantages of conversion were apparent from the start, starting with the buying power of being part of a larger system. “We get some phenomenal vendor rebates -- quarterly checks ranging anywhere from $20,000 to $25,000,” says Dean. “Plus, the business systems themselves -- most people can’t put [these] together over a lifetime of running a company.”

As far as disadvantages, Dean is hard-pressed to come up with any. “If you’re a severe Type-A entrepreneur who can’t follow a system, then [a franchise] is not for you,” explains Dean. “But for someone who wants to make money and is tired of not knowing where to turn [to grow their business], it’s perfect.”

Dean sees two types of entrepreneurs that do well in the franchise system. “First there’s the [people] who are really good followers.” That’s where Dean sees himself. “I consider myself a good leader for my people, but I grew up as a helper, trying to do exactly what needs to get done for customers.” The next type is the entrepreneur who is looking for help in improving their business, because what they’re trying to do isn’t working.

If you’re considering converting your business to a franchise, Dean recommends not hesitating too long before taking the plunge. “Some people just want to be a guy, one helper and a pickup truck,” says Dean. “But if they want to grow their business, take the hard work that they do now, and actually make money at it, then they need to just do it.”

Does Dean still consider himself an entrepreneur, even after joining a franchise system? “I do -- except now I’m successful!” he laughs. Franchisees are still entrepreneurial in his eyes: “You’re still in touch with your community and you’re still a family-owned and operated business. It’s just that you’ve got one up on 99 percent of the companies around you. It makes a big difference.”