Festive franchising - 12 days of Christmas...
As Christmas approaches and the year draws to a close, it’s both a time for reflection and looking to the future. If...
The popularity of franchising has grown rapidly in recent years, and there are now opportunities available across a diverse and ever-expanding range of industries. With so many options to choose from, deciding which franchise is right for you can be challenging. We feel that making the right choice means asking yourself the right questions. And with that in mind, we’ve put together a list of some of the most important considerations to help you find a franchise opportunity that suits not only your financial means and business goals, but also your personality and preferences.
Arguably the most fundamental question to ask yourself is what do you actually want out of the business? People are attracted to franchise opportunities for a wide variety of reasons and having come from all sort of different backgrounds. You need to be clear on whether you’re motivated by making more money, having more time on your hands, or simply taking on a new type of challenge. I
t’s also vitally important to consider whether you want to be involved in day-to-day operations, or take more of a backseat managerial approach as this will also help inform your choice of franchise opportunity. Once you’re clear on exactly what motivates you, and your preferred way of working, you can begin to address some of the other important questions in our list.
Now that you have a better idea of what you want from the business, it’s time to ask yourself what you can bring to the table. Franchising affords people the opportunity to reinvent their careers, so you may not necessarily want to stick to an industry you’ve worked in previously. However, it makes good sense to select a franchise that reflects your core skills in some way. For example, if you have a great track record for building relationships and winning new business, a more hands on franchise opportunity with a good amount of customer interaction would obviously be a good fit regardless of the industry. I
t’s sensible of course to find a balance between what you’re good at, and what you’re most attracted to, especially as passion is one of the major components to success. There is no point taking on a new franchise opportunity that will bore you to tears simply because it reflects your previous experience. So find those skills that are inherent to your personality and then try to align them with your interests.
It goes without saying that the amount you have to invest will dictate which opportunities you can even consider when looking at the different franchises for sale. Upfront costs vary enormously based both on the industry and the specific franchisee. For example, a home-based franchise is obviously going to require much less investment than say a food franchise, which will naturally require more equipment and other resources. I
t’s essential that you properly evaluate not only the upfront costs, but the amount of capital necessary to sustain the business until it becomes profitable. Even with all of the support and resources provided by a typical franchisor, this can take months so it’s best to try and allow more than you think you’ll need.
While one of the most attractive features of the franchise model is the lower risk it represents when compared to starting a business from the ground up, every new business opportunity represents some degree of risk. It’s therefore crucial to consider not only the amount of risk you’re willing to take from a financial perspective, but also what you’re comfortable with on a personal level.
If you have excellent financial resources as well as the characteristics necessary to stay determined and handle stress should difficulties or slow progress be a factor during the early stages, your options can remain broad. If, on the other hand, you have only limited capital, and are very concerned and conscious of risk, you’ll obviously want to look for a franchise opportunity from a very well-established brand or at least an organisation with a transparent and exemplary track record of using the franchising model.
Establishing and maintaining a good relationship with the franchisor is essential to the long-term success of your new venture. It’s important to ask the right questions, and get a feel for who they really are and what they value, rather than simply evaluating the opportunity on paper. It’s a good idea not only to speak to them on the phone, but to arrange to meet face-to-face as well.
Be sure to use this as an opportunity to get as much detail as possible on things like the level of support offered, brand guidelines, and their sales and marketing tactics, as well as what they expect from you as the franchisee. The level of interest in your ideas and goals will often give a far more accurate picture of what it would actually be like to work with them than any amount of historic facts and figures. Ask for a list of other franchisees you can meet with as well, but be sure they allow you to choose who to talk to and don’t simply direct you to one or two they’ve preselected.
Another very important question that often gets forgotten by potential franchisees is whether a given franchise opportunity fits with their exit strategy, not to mention what that might be if it hasn’t already been considered.
Ask yourself if this is something you will still want to be doing in 5 or 10 years time, and whether you intend to pass on the opportunity to somebody else when you do decide to move on. Franchise agreements typically last five years or ten years, with some being considerably longer, and they many come with restrictions in terms of selling the business on. Being clear on your long-term plans and doing your homework in terms of the specific franchise can avoid real difficulties later down the line. Answering all of the key questions detailed above should help narrow your criteria so that you can feel more confident that you’re choosing the right franchise for your circumstances. T
ake a look at some of the fantastic opportunities available here at Start Your New Franchise today.