How to Start a Franchise in 4 Steps

The process for opening a franchise is one of the most common questions interested entrepreneurs seek out when they’re considering how to start a franchise for themselves.

Whether you’re a new franchisee opening your very first location, or a successful multi-unit operator building your business model into a franchise brand to sell to future franchise owners, there are plenty of questions involved.

How much money do I need to start a franchise? Do franchise owners get paid? Is a franchise easy to start?

These are all valid questions, but they come with varied answers dependent on each franchise’s unique structure. While yes, franchise owners get paid, how much is determined by profit, which is driven by sales volume, which then depends a lot on the franchise’s industry, location, product, marketing reach, target audience demographics, timing, and a lot more.

Let’s back up a bit and answer some general questions about how to start a franchise from the perspective of a new potential franchisee in one of the most popular franchise industries, the fast-casual restaurant (since, at Café Mexicali, that’s the industry we know). These steps, however, can be applied to most franchise systems.

How to Start a Franchise in 4 Steps

Step 1: Choosing Your Industry & Brand

The franchising world is a creative place, full of innovative thinkers who have created franchise models that serve all kinds of customer needs. Investors can find a franchise brand to fit almost any industry that speaks to them, from construction, hospitality, financial, home services, fitness, entertainment, retail, healthcare, and so much more.

If you’ve got a passion for an industry, there’s a good chance there’s a franchise out there that does exactly what you’re looking for.

At Café Mexicali, we found our passion in creating flavorful foods that hit the human palate just so and speak to our love of salt and sugar. We put our efforts into creating a menu that’s bold but nuanced without being overpowering, and every ingredient is as fresh as it gets.

We also love interacting with our customers, so our concept for a fast-casual restaurant experience where our guests become regulars with whom we build a community works for us. Feeding people food they crave is our passion, and that was a key concept for us in how to start a franchise.

You may find a brand that works for you the same, or you may do what we did and learn how to create a franchise model yourself. Either way, that’s step 1.

Step 2: Signing Up

Let’s say you pick a brand. What’s next for how to start a franchise?

You need to see if you’re a good match for each other. While this does mean if you’re financially qualified to invest with them, it also includes whether or not you and the brand match well philosophically, and if you have the same entrepreneurial mindsets.

Typically, this process is a series of steps called the Discovery. It begins with completing an inquiry form (such as the one you’ll find on every page of our website), which is where you provide the brand with your contact information.

Next, you and the franchise development team have an introductory call to determine if you and the brand make a good match. If the answer is yes, you’ll undergo candidate qualification, where you’ll answer a series of questions about your financial history and background.

Congrats! You’ve passed candidate qualifications! Next, you get to put the brand you’ve chosen under scrutiny. If you’re wondering how to start a franchise, The Franchise Disclosure Document (FDD) is where you go over the brand’s every detail with a magnifying glass. The FTC requires investors have all questions answered up front so you can make an informed decision about becoming a franchisee.

But even then, that’s not enough. With Café Mexicali, we want our potential franchisees to understand thoroughly how our franchise model works, so our candidates also meet with our current franchisees to ask all the questions they can think of for how to run a franchise and specifically, our franchise.

After that, candidates should be ready to meet in person with the Management Team involved with their brand for what’s called Discovery Day. This is often a fun experience, made better when it’s capped off by the signing of the franchise agreement.

It’s an incredible feeling! Now you’re a new franchise owner with the brand you’ve chosen! Congratulations! You’re well through the beginning of how to start a franchise!

Step 3: Pre-Opening Phase

This is the part of how to start a franchise where new franchisees really get to dig in and learn the business model for their new investment. It’s exciting!

Your brand’s franchise development team won’t let you flounder by yourself to open your new franchise location. They’ll begin advising you right away on site selection. Now, they can’t tell you where to choose to open, but it’s wise to listen to their advice, because they’ve likely opened previous franchise locations and they know the target audience. The brand will have demographics data and real estate experience, not to mention, they can offer tips on lease negotiations that make selecting your location easier and more affordable.

Once your site is selected, the build-out and equipment selection process starts. It’s incredible to watch the franchise location take shape and see your investment come to life. You’ll really feel the moments here when you truly become part of the crew that makes up your brand’s family.

You’ll also begin training on how to start a franchise right away. Each brand is different in how extensively they train new franchisees on how to start a franchise, and where that training takes place. For Café Mexicali, we invite our franchisees to one of our flagship Colorado locations for an intensive training experience for 3 weeks, where they learn everything they need to know about our brand, our menu, and how we take care of our guests.

Franchise brands will also provide their franchisees with training on technology tools, such as Point of Sale software, inventory tracking, accounting, and security software needed to run the franchise, as well as guidance on how to start a franchise and other technology needed to keep the franchise running smoothly.

Step 4: Grand Opening & Beyond

One of the biggest milestones for how to start a franchise is grand opening day. Your franchise development team will likely have support staff on-site with you to see you through the biggest day of your franchise so far. They’ll show you how to run your franchise and help you through any speed bumps that may come up.

Once they leave and it’s business as usual, you’ll likely have access to the brand’s confidential operations manual, an important resource that provides information on daily operations and everything necessary to maintain the brand’s standard of operations.

Additionally, the brand should continue providing ongoing support and most franchises have dedicated people available to answer questions and be there for their franchisees to help with how to start a franchise and keep it running smoothly. They’ll also give franchise owners access to marketing support and promotional materials to help with local and national marketing campaigns.

How to Start a Franchise with Café Mexicali

With Café Mexicali, our franchise owners get all of the above and so much more, because the timing of our franchise model investment couldn’t be better.

Not only that, our founders Rick Krammer and David Hoffman are a top-notch leadership team that have an unparalleled record of restaurant management to draw upon. With Café Mexicali, we’ve found that magical combination of the right people, the right concept, and the right timing to create something special.

We have the “how to start a franchise” part down. Now, we just need the passionate and qualified investors to join us.

We’re interested in expanding first across Colorado and into Utah, Arizona, and Texas, but our ambition doesn’t stop there, nor are we limited to those locations. If you believe your area would be well-served by a Café Mexicali franchise, we’d love to hear from you!

Then, we just need to follow the steps above for how to start a franchise, and we’re ready to begin!

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