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eCommerce Franchising: Is This Possible?

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eCommerce Franchising: Is This Possible?

With retail entrepreneurship, whether that be online or offline, there are several ways you can start, grown and franchise your own business. You have so many options available, especially thanks to the internet, and so long as you are willing to put in the initial effort, there’s no reason why you can’t enjoy unparalleled success if you have a very good product or service.

Launching an eCommerce store is a journey which many more wannabe business entrepreneurs are embarking upon day by day. It is now easier than ever thanks to the likes of Shopify and the many third-party integrations which can be used for this growth, and it has created lots of opportunities where there once weren’t many.

 

Retail Franchising and eCommerce

The viability of franchising your retail or eCommerce brand largely comes down to where you are with it in terms of growth and development. After all, nobody is going to be interested in eCommerce franchising a new company or brand which hasn’t proven itself as being profitable and strong.

Many people go into the eCommerce business with the goal of one day franchising their brand to other people, however, this is very much a long-term goal and it’s not something which comes very easily.

That being said, it is very possible.

eCommerce franchising is the act of opening a single online store based on your name, branding, products, and trademark, and then allowing other people to “franchise out” your brand and operate as a seller of your products and services.

The franchisee – i.e. the other person selling your product or services – will pay you a fee so that they can do this.

 

Is eCommerce Franchising Difficult?

That really depends on what kind of business you are running and which industry you operate in. Compared to starting up a regular eCommerce store, launching a franchise comes with its own set of challenges, rules, skill requirements and expectations.

Strictly speaking, it is possible to launch an eCommerce franchise as a franchise, however, it’s always a better idea to establish yourself within your industry before attempting this. It’s also a good idea to weigh up the pros and cons of whether you should pursue franchising as an option for your eCommerce business.

 

The Benefits and Drawbacks of eCommerce Franchising

If launching a business is tough, then attempting to franchise one is even harder.

From securing investment, sourcing product, hiring employees, creating a business plan for your potential franchise and lots of other considerations, there’s a lot involved.

Some of the benefits associated with franchising an eCommerce business include:

1. Much faster growth potential

eCommerce franchising provides the opportunity for faster growth. If you have five people interested in your company and want to run their own franchises of it, then that’s five extra points of sale. Your company and franchise already has a business model in place, so people who are looking to open a business quickly often turn to franchises.

2. Training and development

Because you’ve already got a business and, likely, a team of staff in place, you have already been through the vetting, hiring and training process which makes it much easier for you and any potential franchisees. This means that they can get the ground running and contribute to your profits.

3. Your brand recognition will improve

If there are more points of sale for your product or service then more people are going to see and become familiar with it, leading to heightened brand recognition.

 

Whilst all this sounds good, there are also some drawbacks:

1. Franchising remove some control from you

You can’t be in more than one place at once, and by franchising your business you are placing a great degree of trust into your franchisee(s) to follow your rules and regulations. In practice, this doesn’t always happen.

2. It can have a negative impact on reputation

This, of course, ties into the above point about control. You need to be very careful about who you take on as franchisees and ensure that you only allow people to represent your business if they can uphold your standards and expectations. It only takes one wrong move of a franchisee to create a negative image for a company.