To effectively start a new home security business, you'll need to do plenty of research and planning to be sure you'll be positioned for long-term success in the industry. One of your first decisions will be to choose a business model. Will you operate a franchise, a dealership or will you start out completely on your own?
Fortunately, if you decide to buy the rights to a franchise business, you'll get plenty of help and expertise from the franchisor. In this post, we explain 11 steps in the start-up process, specifically in the context of a franchise business model.
11-Step Process to Start a Home Security Business
Let's look at some of the basics necessary to set up your own franchise home security business. We'll go into more detail for each of these steps below:
- Research and contact franchisors
- Understand your competition
- Apply for licensing and secure certifications
- Obtain insurance, join associations
- Create a business plan and marketing plan
- Plan and secure your start-up funding
- Become fully trained in the business
- Choose your location. Physical shop? Online business only?
- Hire your employees
- Launch your sales and marketing initiatives
- Begin operations
1) Research and Contact Franchisors
After deciding on the home security services industry for your business, you'll need to contact the franchisor(s) you're considering to discuss whether the business will be a good fit. Discuss the business terms and fees. Once you choose a franchisor and agree on the fees, you should be supplied with detailed instructions and recommendations about training, insurance, marketing and employees.
2) Understand Your Competition
You should know who your competition is and where they are located. By understanding how they operate and market their services, you can more easily develop your plan for business. This helps you to learn if your business could be profitable and where the most logical locations might be to open the business.
3) Apply for Licensing and Secure Certifications
All new businesses must register with the state to obtain a state tax identification number. In addition, you must get an employee identification number from the IRS. Check with the state where you'll be operating to learn about licensing requirements. Because the business is centered around security, you and your employees may be expected to complete background checks and certification tests. These extra steps can add to the professionalism and reputation of your business.
4) Obtain Insurance and Join Associations
Some franchising companies may provide insurance, or it may be up to you to secure suitable insurance coverage. It's best to meet with an insurance agent and discuss general business liability coverage in addition to other types of coverage that may be recommended for a security business.
Joining associations affiliated with home security and networking can often provide advantages. In addition, your local Chamber of Commerce is a wonderful place to advertise and get business recommendations. Involvement can also help you to become viewed as an active community member.
5) Create a Business Plan and Marketing Plan
With all the groundwork laid, now, you're ready to develop your business plan. Essentially, this is your plan on how you'll get the business started and keep the operation going. The plan should include what security features you're offering, where funding will be obtained, associated costs of running the business, daily operations, marketing and advertising efforts, equipment and employee requirements.
6) Plan and Secure Start-up Funding
Once you're advised of the start-up franchising fees, you'll need to evaluate your funding situation. Will you need to borrow? What are your funding options? Small business loans and 401k rollovers are two common sources of start-up funding. Presenting a detailed business plan to your lender, whether it is a bank or an investor, will increase your credibility and your chances of obtaining funding for your new franchising operation.
Some franchise companies may offer in-house financing or referrals for financing, and you may get excellent repayment terms and competitive rates with them rather than going through a bank.
7) Become Fully Trained in the Business
Even if you're a seasoned business person, you'll want to go through the franchise training that is offered to you when entering into a new franchise operation. You should become an expert on the products and/or services you'll provide and understand all the systems and processes in place that you'll be using. You'll also want to make sure all employees are trained on the business structure as well once they are hired.
8) Choose Your Location
If your franchising company has location requirements, you must adhere to their rules and work within their guidelines. If there are no set rules, it is up to you to locate the best location for the business. Will you set up a physical shop for the business? Or will you operate online only? Depending on the situation, you should consider both purchase and rental options, costs and customer accessibility.
9) Hire Your Employees
If you need employees, find qualified employees to fill positions in sales, operations and administration, at a minimum. You can network in order to find these individuals and also place hiring ads online and in various publications. Have a documented hiring process, training program and employee guidelines in place so your new hires know exactly what to expect when working for you.
10) Launch your Sales and Marketing Initiatives
Your franchisor should provide a basic marketing plan and even provide local and national advertising opportunities. Depending on the agreement, you'll need to carry out this marketing plan, or you may have some freedom to develop your own plans, specific to your local area.
Implementing some level of digital marketing and website optimization strategy is a smart idea to the many attract visitors and customers who are increasingly searching for products and services online.
11) Begin Operations
With smart planning and preparation using the steps outlined above, you'll be ready to 'open your doors' for business before you know it. As you work on your business growth, be sure to maintain good relations with clients and be committed to continuous improvement in all areas, including products, customer service, employee satisfaction and, of course, sales.
Opening the Business of Your Dreams
Planning and hard work are the keys to your success. Utilize recommendations and resources from the franchisor, and you'll have an excellent start on your home security business. To help you on your way to franchise success, download our e-book below, Grow Your Business Using the Franchise Model, for a smart business growth strategy.
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