A franchise business model refers to an arrangement in which one company (the franchisor) grants another individual (known as a franchisee) the right to market and operate their name and methods within an identified territory or region. They must follow a plan established by their franchisor when conducting their operations.
When selecting a franchise, it’s essential that it fits both your goals and personal values. Here are some helpful suggestions to ensure you find your ideal fit:
1. Determine Your Goals
Your choice of franchise should reflect both personal and professional goals, which can be determined through thorough self-evaluation and market insights.
An individual looking to work from home might not invest in a franchise that requires storefront space, so it is wise to conduct thorough research and speak to other franchisees before deciding.
Effective goals must be specific, measurable, attainable, relevant and time-bound (SMART). For instance, a new franchise owner might set themselves the goal of acquiring certain number of clients or reaching certain revenue milestones within their first few months of operations.
2. Identify Your Skills
When purchasing a franchise, you are making a long-term commitment that requires careful thought. A franchise may provide opportunities to grow while simultaneously supporting success for years.
Conducting a self-assessment and reviewing your professional strengths is an excellent place to begin. For example, if precision and attention to detail are your forte, perhaps a franchise that requires this work might be suitable.
Your franchise’s rules and guidelines, which can be found in their Franchise Disclosure Document (FDD), must also be observed.
3. Consider Your Personal Values
Finding the appropriate franchise requires considering your personal goals and values. A well-established brand may offer a culture that aligns with your own, giving you greater professional and personal success.
Financial readiness and objectives play a major role in decision making. Conducting a detailed financial self-assessment will allow you to create an appropriate budget plan and understand any startup costs which may derail your plans.
Consider your long-term financial goals before selecting a franchise business. A franchise that provides scalability and retirement and succession planning solutions may better fit with your needs.
4. Think About Your Lifestyle
Franchisees looking for their ideal franchise should focus on more than the financial aspects when making their decision, but also consider how well their new business fits with their lifestyle and work/life balance – the right franchise can increase success odds exponentially!
Love what you do and never have to work again! That’s why selecting a franchise that meets your lifestyle requirements will bring joy – for example if morning is your time of day, perhaps exploring breakfast franchise opportunities could make an excellent career choice.
5. Look at the Competition
Successful franchise investments can be highly rewarding; however, it’s essential that you thoroughly research and assess all available options, which includes consulting with financial advisors, business consultants and franchise experts.
As part of your research, take into account competitors’ sales records and market potential in your territory. Select a franchise with proven success that offers products or services with strong demand from potential clients.
Make sure that the current and future trends of the industry align with your goals and personal values. If your desired location has already become saturated with similar franchises, it might be worthwhile to explore alternative areas.
6. Ask Questions
If you are serious about becoming a franchisee, make sure that you ask questions of the franchisor about training provided and support offered afterward.
Your main priority should be learning what typical daily tasks look like for a franchisee and, if required to contribute towards advertising campaigns locally, regionally or nationally, what the marketing strategy of your chosen franchise would be and if any decisions would fall within your purview.
Large franchises generally employ a multistep, structured process that begins with a phone call and progresses to presentations and visits to their physical headquarters (or virtual one due to Covid-19). Smaller companies might employ an informal or more laid back process.
7. Read the Contract
Once you’ve identified an appealing franchise opportunity, review its contract carefully before signing. Focus particularly on the training and franchisor support sections as a good franchise will make this information clear and concise. Look out for sections which describe its history or predecessor companies; this will help you better comprehend their business while also giving insight into any legal requirements unique to franchised businesses such as needing permits or licenses. Also try gathering details on its executives as they might manage this franchise system effectively.