Choosing The Right Franchise
Updated: Mar 19, 2020
The following is an article “Choosing The Right Franchise” by Marc Primo.
You have finally saved up enough capital to finance your business venture. Upon studying your options, you decide on turning to franchising but don’t know the first thing about the industry.
Becoming a franchisee certainly has its own benefits. Aside from sparing yourself of the long process of establishing a product or service, you already have an effective business model in place and most of the work has already been done for you. Usually, the support systems are great and you have the luxury to choose which suits you the best.
When planning on which franchise fits your business plan the most, consider these three tips that could help you in the long-term.
Pick an interest and brand. The chances for success in any franchising venture become bigger if you have great passion for your product. Being well versed in what your product or service, and having the right skill set to sell it is a major factor. Make sure you now everything there is to know about what you are selling by heart. However, this does not mean that you have to relax. Put in the effort to learn more on improvements, and keep tab of the public’s perception of your brand. Keeping yourself interested in your product ensures that you are on top of everything and are committed when it comes to moving your business forward.
Review the benefits offered. Most franchisors also have benefits to franchisees in place. Reliable support systems from corporate are usually in place for franchisees in order to preserve the franchise’s business model and standards. Review what benefits are worthy of your investment and always wear your entrepreneur’s hat so you could keep pace with the growth of the brand. Each franchisor will present you a Franchise Disclosure Document (FDD) so consult your legal and financial advisers first before signing up. This document is your bible that contains the most vital information on your responsibilities as franchisee, and that of the franchisor.
Calculate for capital, ROI, and sustaining profits. Every investor places profit as the most important aspect of doing business. More profit equals more leverage to perform better. So in each franchising venture, it is important to calculate your payments for the franchisor as per the franchisor’s FDD, the projected term on the return of investment, and profitability. Talk to your fellow franchisees about experiences, challenges, and opportunities instead of depending on the reputation of your product. Enroll in training programs that could help you manage your business, and seek technical support when you need it.
Pay special attention to instances of bulk discounts from franchisors and other promotional initiatives, and keep tab of their advertising and marketing trends. Should you wish to sell your franchise just in case you may want to pursue a different venture, you may seek assistance from your franchisor as most perform routine market research for new buyers. Another good thing in opting to invest in franchising is the support system you get so you don’t have to study and execute each process on your own.