If you are considering launching your own business, franchising is a popular way to help you get there. There are literally thousands of franchise opportunities available ranging from the well known — such as McDonald’s — to the more obscure. The chief advantage of operating a franchise is clear: you get a proven business model to tap into to. Nevertheless, you need to do your homework before choosing a franchise. Moreover, there are several important points to consider when establishing your own business.
1. Location, location, location — What is true for residential real estate holds true for commercial real estate. And that would be the importance of its location. Certainly, the franchisor will have some say where you establish shop, but there are other points to consider as well. Potential traffic is critical: if you are located in a mall, you want a location that is well-trafficked and can yield the greatest potential customer base out there. It is important for you to know your chief demographic and how best to reach these people.
2. Your people matter — You can have the best franchising opportunity and a great location, but those advantages can fade in the face of how well your staff treats your customers. Truly, you want to hire a general manager who knows how to run the business and has the passion to make your business thrive. Further, your GM must hire and train his managers who will then train your workers. If your staff is strong from top to bottom, then you are in good shape. If there are weak links, then you are in trouble. If your GM is incompetent, you must fire him.
3. Rules are made to be followed — You may have the best business head on your shoulders and the ability to thrive wherever you are placed, but if you ignore the franchise blueprint, then you will run into trouble. There is a reason why franchisors establish detailed guidelines on how to run your business as they have worked through many different scenarios down through the years and have refined the playbook. If there is something you believe should change, do not do it on your own. Rather, go through the usual chain of command to move your suggestion forward through the company’s ranks.
4. Do what you want to do — Simply because a franchise is a raging success does not mean that you should pursue it. There may be a foodie franchise that has potential great profits, but if your passion is personal care, it will not synch well with you. Instead, find out what you’re really interested in doing and follow that. You will be happier for it and your passion will enable your business to not just survive, but thrive.
5. Take the next step — It is common for successful franchisees to open successive locations once they feel at home with their single unit. Indeed, you should know that some franchisors want franchisees who are committed to opening multiple locations, taking their business model to people and places not considered earlier. Do you have the stamina and the interest to grow your business? If not, look for a business model where one store franchisees are the norm.
Operating a franchise is a big deal. It can also lead to big profits if you are willing to take some risks and make sacrifices. Franchising is not for everyone, including the individual who prefers to the end the day by turning off the phone and shutting the door.
Understand your temperament when it comes to choosing a franchise or for any small business option for that matter. Examine everything very carefully before you make a decision that can have widespread ramifications.
See Also — How to Help Your Franchise Succeed