Is franchising a good way to scale a small manufacturing business?

searcher profile

September 17, 2024

by a searcher from Columbia University - Columbia Business School in London, UK

Looking at acquiring small manufacturer of high quality product that has never used sales or marketing to grow - and completely lacks any customer service offerings. All obvious ways to grow the business, capture more customers as well as value per customer. Wondering if using a franchising approach might offer quicker route to scaling and bringing online additional customer service offerings etc. As opposed to building resource and capability in-house? Any thoughts on pros/cons and things to look out for would be really appreciated. Thanks.

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commentor profile
Reply by a searcher
in Portugal
Lack of GTM (Sales, Marketing, CS, Product) investment and team is always the issue with manufacturing - the mindset is usually just deliver vs create value/position/expand! It also happens because of thin margins that don't accommodate space for investment. I see huge opportunities though to change this. Have been working with a player of the HVAC industry and tried to turnaround the business - however it is a lot of work because it is a mindset shift. Good luck and all the best!
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Reply by an intermediary
from Arizona State University in Houston, TX, USA
Luke thanks for the tag. Manufacturers use multiple forms to distribute their products: manufacturer reps, distributors, franchising, etc.

To consider franchising, you need to develop, implement and prove the model. (I suggest in multiple markets). The question is best presented to an attorney who has a specialty in franchising and a consultant with experience in helping with the strategic planning and implementation. Open to discussing more, if you would like.
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